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Private Education or Alternative Education Loans are used by families to help pay the cost to attend college when other financial aid is not enough or when they want different loan terms than what is offered by the government loan programs. We recommend that you consider private loans only after you have borrowed the maximum amounts allowed through the federal student loan programs. Parents should carefully consider whether the PLUS Loan program (which is usually less expensive over the long term) is a better option than a private education loan or a home equity loan. Then if you still feel you need to borrow one of these loans, you’ll need to look beyond the lender’s marketing materials to research your private loan options. Here are a few pointers to keep in mind:

Most private loans offer a variable interest rate tied to either the LIBOR or PRIME financial rates. For now, a rate of LIBOR + 2.8% is roughly the same as PRIME + 0.0%. Generally, it is better to have an interest rate pegged to the LIBOR index, as such a rate will increase more slowly than a rate pegged to the PRIME index. The interest rates and fees you pay on a private student loan are based on your credit score and the credit score of your cosigner, if any.

Usually, you will get a better interest rate if you have a cosigner even if you could apply for the loan on your own. The best private student loans will have interest rates of LIBOR + 1.8% or PRIME – 0.50% with no fees. Unfortunately, these rates often will be available only to borrowers with great credit who also have a creditworthy cosigner. It is unclear how many borrowers qualify for the best rates.

Private student loans are counted in the financial aid calculation and must be reported to our office. You can use a private loan to replace unmet need or the calculated family contribution on your award letter without lowering your other aid. If your private loan is more than your cost of attendance minus your other aid, then either we will reduce your UW financial aid, or you will need to return some or all of the private loan.

The fees charged by some lenders can significantly increase the cost of the loan. A loan with a relatively low interest rate but high fees can ultimately cost more than a loan with a somewhat higher interest rate and no fees. (The lenders that do not charge fees often roll the difference into the interest rate.) A good rule of thumb is that 3% in fees is about the same as a 1% higher interest rate.

It is important to ask the lender how often the interest is capitalized on the loan (capitalization occurs when deferred interest is added to the principal so you will end up paying interest on the interest that had accrued on your loan). The frequency of capitalization can affect the overall cost of the loan and can vary among the different loan programs.

For most private loans, you apply on-line directly to the lender, the lender asks us to certify your costs and enrollment information and then if the lender approves your loan the funds are sent to the school to disburse to you. If you borrow a loan that does not go through the school, then you’ll need to report the amount you borrow to our office.

Self-certification

Federal regulations now require most private educational loan borrowers to complete a self-certification form prior to the loan being finalized. The self-certification form is intended to promote “informed borrowing” by educating borrowers about financial aid availability and encouraging them to seek advice from the financial aid office about other forms of aid before taking out a private education loan.

You may obtain the self-certification form from your lender. This form requires you to obtain information regarding your cost of attendance and the amounts of financial aid assistance that you are receiving from other sources (such as grants, federal loans, and scholarships). Information necessary to complete this form is available on your MyUW account in the “Financial Aid Status” section. You will be asked to provide the following financial aid information from MyUW: “Total Budget”, “Resources” (do NOT include Expected Student and/or Parent Contribution) and “Total Aid Offered”.

If you have not completed a FAFSA, or have any questions regarding the self-certification form, please contact our office.

Private loan disbursement

Federal regulations require a three business day “right to cancel” period, beginning after you receive your final loan disclosure from your lender. Lenders cannot release your first loan disbursement until after this time period has passed. This waiting period applies to most private education loans. We encourage students who are applying for a private education loan to do so several weeks in advance to ensure funds are received to pay tuition, housing, etc by their respective due dates.

Repayment

For repayment information, please contact your private loan lender directly.

Alaska Resident Loans

The Alaska Commission on Postsecondary Education (ACPE), a government agency and nonprofit education lender, offers a variety of low-cost financial aid programs for Alaskan students and families. For more details, please review their website.

Lenders

The University of Washington cannot recommend a lender or lenders to you to use for your private loan. We don’t know the absolute best deal for you – the lenders and the terms of the loans change frequently and your credit score is unknown to us. We are happy to help you understand the private loan process, especially how it relates to your other financial aid, so please contact us if you have questions.

Finaid.org provides information (they provided many of the tips above) about student loan borrowing and a comparison chart of many of the private loans available.

RESOURCES

Applying for Financial Aid
Parent Plus Loan
New Borrowers of Federal Student Loans

CONTACT US

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Visit Contact us for office location, directions and mailing address.

FEDERAL SCHOOL CODE

Our Title IV federal school code is 003798. This code is used for Seattle, Bothell and Tacoma campuses.

Private Educational Loans

Private student loans are offered through a variety of banks and other lenders. Students wanting  private loans must apply separately from their financial aid application through an individual lender. The best rates on these loans are generally offered to borrowers with good credit and/or who have a cosigner with good credit.

When shopping for a private loan, look for a loan you can live with in both the short term and the long term. You may be repaying it for multiple years after graduation. Many loan providers will lend up to the amount of the student’s cost of attendance minus any financial aid received. Often there is a yearly and/or cumulative cap on the amount the student may borrow; sometimes this cap is set by the student’s school. Note that it takes two to four weeks to process private loans through our office.

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Borrower Requirements and Cosigners

Private Loan Eligibility, Loan Terms, and Requirements

How to Find and Apply for a Private Loan

Typical Loan Payments

Borrower Requirements and Cosigners

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Most lenders require half-time student enrollment. Our staff checks enrollment status when a loan is disbursed, not when the loan is certified. Many private education lenders also require student borrowers to have a loan cosigner.

In addition to increasing your chances of getting your loan approved, having a cosigner sometimes helps you get a lower interest rate and may reduce the approval time. Your cosigner need not be a relative, but should be someone with a steady income and a good credit history. Some lenders will release the cosigner from the loan if the student borrower has met certain requirements, such as making payments on time.

Private Loan Eligibility, Loan Terms, and Requirements

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Eligibility Criteria

Non-need-based

Most lenders require at least half-time enrollment, although some lenders offer borrowing options for students with less than half-time enrollment. If you need assistance, contact the Office of Financial Aid

Borrower must be a U.S. citizen or eligible noncitizen

Borrow may be required to have a cosigner

Loan Terms

Fees from 0-12%, depending on borrower's credit. Some have origination fees.

Loan amounts often are cost of attendance minus financial aid offered. Sometimes set by school. Often include a yearly and/or cumulative cap (as high as $250,000 for undergraduates).

Interest rates generally PRIME -1% to +7.75% or LIBOR +1% to +8%

Repayment term ranges from 0-25 years, depending upon amount of loan

Interest rates, fees, and loan limits depend upon borrow/cosigner credit history, loan options, and repayment schedule. Having a cosigner may reduce interest rate and loan fees

Additional Information and Requirements

Students do not need to submit a FAFSA if they are not applying for other aid.

The federal Truth in Lending Act requires students to submit a Private Education Loan Self-Certification Form to their lender.

Lender Requirements

Under provisions of the Truth in Lending Act, private education loan lenders (including long-term U-loans and Health Professions Loans) must:

Provide three separate loan disclosures to borrowers: one at the point of application, one when the loan is approved, and one before the loan is disbursed.

Have a waiting period of three to seven business days between the time the borrower receives the final loan disclosure and the time the loan is disbursed.

Receive a signed self-certification form from the student before disbursing the loan.

Your lender should provide you with these requirements. If you have questions, contact our office.

The Self-Certification Process

You must submit a completed Private Education Loan Applicant Self-Certification form to your lender. Your loan will not disburse until your lender receives it.

Your lender should provide you with a copy of the required Private Education Loan Applicant Self-Certification Form. Complete and return it to your lender as soon as possible. If you do not receive the form from your lender, you may download it from our Forms page. Contact your lender for your application ID or other identifier that will help to match the form with your application. This form is required by provisions in the federal Truth in Lending Act.

To complete the form, you will need to know your Cost of Attendance and your total financial aid offer. If you receive financial aid, this information can be found on your Financial Aid Notice in Wolverine Access. For more about viewing your Financial Notice, see the Understanding Your Offer page.

Cost of Attendance is at the top of your financial aid notice and your total financial aid offer in the sections at the bottom. To get the total figure, you must tally the aid awarded in each section including Gift Aid, Work-Study, Loans, and Other.

If you are not receiving financial aid, find your cost of attendance using figures on the Cost of Attendance page.

How to Find and Apply for a Private Loan

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If you are considering borrowing through a private lender, we encourage you to:

Exhaust all other possible sources of financial aid first, including federal loans and Work-Study.

Reduce your expenses and borrow only what you need.

Ask questions and compare rates and terms offered by different lenders.

If you pursue a private loan, apply directly through the lender you select. Choose any lender and the university will certify your application.

Beware of suspicious or unsolicited loan offers

U-M students should avoid lenders that don't require U-M to certify their loan application and should be suspicious of unsolicited loan offers. The Michigan Student Financial Aid Association cautions students that "loan debt can accumulate quickly and result in a lifetime burden of high payments and credit denials for automobile purchases, credit cards, and home mortgages. Private loans also can reduce eligibility for more desirable federal, state, and college aid programs. To avoid these problems, read and understand the terms and conditions of all loans."

To browse a selection of lenders, please visit the University of Michigan's FastChoice Private Education Loans website. If you are an international student, visit the University of Michigan's FastChoice International Private Education Loans website. Students are welcome to use any lender of their choice.

The university adheres to a Code of Conduct for Student Loans that prohibits inducements or incentives by private lenders.

Typical Loan Payments

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Undergraduate Students

Interest RateAPRMonthly PaymentPrime +0.00%7.98%$64.48Prime -0.50%7.51%$61.35

Note: This APR example is based on borrowing a $6,000 undergraduate loan with a 38-month deferral period followed by a 240-month repayment period. The Prime Rate is assumed to be constant at 8.25%. Interest rates indexed to the Prime Rate as published in The Wall Street Journal will vary. The APR will increase if the Prime Rate increases and would result in a higher monthly payments, an increase in the number of scheduled payments, or both.

Graduate Students

Interest RateAPRMonthly PaymentPrime +0.00%8.10%$80.82Prime -0.50%7.62%$77.13

Note: This APR example is based on borrowing an $8,000 graduate loan with a 27-month deferral period followed by a 240-month repayment period. The Prime Rate is assumed to be constant at 8.25%. Interest rates indexed to the Prime Rate as published in The Wall Street Journal will vary. The APR will increase if the Prime Rate increases and would result in a higher monthly payments, an increase in the number of scheduled payments, or both.

OFFICE OF FINANCIAL AID

2500 STUDENT ACTIVITIES BUILDING
515 EAST JEFFERSON STREET
ANN ARBOR, MI 48109-1316 US

T: 734-763-6600

F: 734-647-3081

Understudy Monetary Guide

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Momentary credits

Private schooling or Elective Training Credits are utilized by families to assist with paying the expense to go to school when other monetary guide isn't sufficient or when they need different advance terms than what is presented by the public authority advance projects. We suggest that you consider private advances solely after you have acquired the greatest sums permitted through the government understudy loan programs. Guardians ought to painstakingly consider whether the In addition to Credit program (which is typically more affordable over the long haul) is a preferable choice over a private schooling credit or a home value credit. Then assuming you actually feel you want to acquire one of these advances, you'll have to look past the bank's promoting materials to explore your confidential credit choices. The following are a couple of pointers to remember:

Most confidential credits offer a variable loan cost attached to either the LIBOR or PRIME monetary rates. For the time being, a pace of LIBOR + 2.8% is generally equivalent to PRIME + 0.0%. By and large, it is smarter to have a loan cost fixed to the LIBOR record, as such a rate will increment more leisurely than a rate fixed to the Excellent file. The financing costs and expenses you pay on a confidential understudy loan depend on your FICO rating and the financial assessment of your cosigner, if any.

For the most part, you will get a superior financing cost on the off chance that you have a cosigner regardless of whether you could apply for the credit all alone. The best confidential understudy loans will have financing costs of LIBOR + 1.8% or PRIME - 0.50% without any expenses. Sadly, these rates frequently will be accessible just to borrowers with incredible credit who likewise have a reliable cosigner. It is hazy the number of borrowers that fit the bill for the best rates.

Confidential understudy loans are included in the monetary guide estimation and should be accounted for to our office. You can utilize a confidential credit to supplant neglected need or the determined family commitment on your honor letter without bringing down your other guide. On the off chance that your confidential advance is more than your expense of participation less your other guide, then, at that point, possibly we will diminish your UW monetary guide, or you should return some or the entirety of the confidential credit.

The expenses charged by certain moneylenders can altogether expand the expense of the advance. A credit with a moderately low loan cost yet high expenses can eventually cost in excess of an advance with a to some degree higher loan cost and no charges. (The moneylenders that don't charge expenses frequently fold the distinction into the loan cost.) A decent guideline is that 3% in expenses is about equivalent to a 1% higher loan fee.

It is critical to ask the moneylender how frequently the premium is gained by the credit (capitalization happens when conceded revenue is added to the head so you will wind up paying revenue on the premium that had gathered on your advance). The recurrence of capitalization can influence the general expense of the credit and can change among the different advance projects.

For most confidential advances, you apply on-line straightforwardly to the moneylender, the bank requests that we ensure your expenses and enlistment data and afterward assuming the bank endorses your credit the assets are shipped off the school to dispense to you. In the event that you get a credit that doesn't go through the school, then you'll have to report the sum you get to our office.

Self-accreditation

Government guidelines presently require most confidential instructive credit borrowers to finish a self-certificate structure preceding the advance being concluded. The self-certificate structure is planned to advance "informed getting" by teaching borrowers about monetary guide accessibility and empowering them to look for counsel from the monetary guide office about different types of help prior to taking out a private schooling credit.

You might get the self-accreditation structure from your loan specialist. This structure expects you to get data in regards to your expense of participation and the measures of monetary guide help that you are getting from different sources (like awards, government credits, and grants). Data important to finish this structure is accessible on your MyUW account in the "Monetary Guide Status" segment. You will be approached to give the accompanying monetary guide data from MyUW: "Absolute Financial plan", "Assets" (do exclude Anticipated Understudy and additionally Parent Commitment) and "All out Help Advertised".

On the off chance that you have not finished a FAFSA, or have any inquiries with respect to the self-certificate structure, if it's not too much trouble, contact our office.

Confidential advance dispensing

Government guidelines require a three work day "right to drop" period, starting after you accept your last credit divulgence from your bank. Moneylenders can't deliver your most memorable credit dispensing until after this time span has elapsed. This holding up period applies to most private schooling advances. We support understudies who are applying for a private schooling credit to do so a little while ahead of time to guarantee reserves are gotten to pay educational cost, lodging, and so on by their individual due dates.

Reimbursement

For reimbursement data, if it's not too much trouble, contact your confidential advance moneylender straightforwardly.

Gold country Occupant Advances

The Frozen North Commission on Postsecondary Instruction (ACPE), an administration organization and charitable training loan specialist, offers an assortment of minimal expense monetary guide programs for Alaskan understudies and families. For additional subtleties, kindly survey their site.

Loan specialists

The College of Washington can't prescribe a bank or moneylenders to you to use for your confidential credit. We don't have the foggiest idea about the very best arrangement for you - the banks and the details of the advances change much of the time and your FICO rating is obscure to us. We are eager to assist you comprehend the confidential credit process, particularly the way in which it connects with your other monetary guide, so kindly reach us assuming you have questions.

Finaid.org gives data (they gave a significant number of the tips above) about educational loan getting and a correlation graph of a considerable lot of the confidential credits accessible.

Assets

Applying for Monetary Guide

Parent In addition to Credit

New Borrowers of Government Understudy Loans

Reach US

Send us a message

Visit Reach us for office area, headings and postage information.

Government SCHOOL CODE

Our Title IV government school code is 003798. This code is utilized for Seattle, Bothell and Tacoma grounds.

Confidential Instructive Advances

Confidential understudy loans are presented through different banks and different moneylenders. Understudies needing private credits should apply independently from their monetary guide application through a singular loan specialist. The best rates on these advances are by and large proposed to borrowers with great credit or potentially who have a cosigner with great credit.

While looking for a confidential credit, search for a credit you can live with in both the present moment and the long haul. You might be compensating it for a very long time after graduation. Many credit suppliers will loan up to how much the understudy's expense of participation less any monetary guide got. Frequently there is a yearly as well as total cap on the sum the understudy might get; in some cases this cap is set by the understudy's school. Note that it requires two to about a month to handle private credits through our office.

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Borrower Necessities and Cosigners

Confidential Credit Qualification, Advance Terms, and Prerequisites

Step by step instructions to Find and Apply for a Confidential Credit

Average Credit Installments

Borrower Necessities and Cosigners

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Most loan specialists demand half-time understudy enlistment. Our staff checks enlistment status when a credit is dispensed, not when the advance is guaranteed. Numerous private schooling banks likewise require understudy borrowers to have a credit cosigner.

As well as expanding your possibilities getting your credit endorsed, having a cosigner some of the time assists you with getting a lower loan fee and may diminish the endorsement time. Your cosigner need not be a family member, yet ought to be somebody with a consistent pay and a decent record. A few moneylenders will let the cosigner out of the credit on the off chance that the understudy borrower has met specific prerequisites, like making installments on time.

Confidential Credit Qualification, Advance Terms, and Prerequisites

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Qualification Models

Non-need-based

Most banks demand in some measure half-time enlistment, albeit a few loan specialists offer getting choices for understudies with not exactly half-time enlistment. In the event that you want help, contact the Workplace of Monetary Guide

Borrower should be a U.S. resident or qualified noncitizen

Get might be expected to have a cosigner

Credit Terms

Expenses from 0-12%, contingent upon borrower's credit. Some have start expenses.

Advance sums frequently are cost of participation less monetary guide advertised. Some of the time set by school. Frequently incorporate a yearly or potentially combined cap (as high as $250,000 for students).

Financing costs commonly PRIME - 1% to +7.75% or LIBOR +1% to +8%

Reimbursement term goes from 0-25 years, contingent on measure of credit

Financing costs, expenses, and advance cutoff points rely on get/cosigner record as a consumer, credit choices, and reimbursement plan. Having a cosigner might lessen financing cost and credit charges

Extra Data and Prerequisites

Understudies don't have to present a FAFSA in the event that they are not holding a candle to the current situation for other guide.

The government Truth in Loaning Act expects understudies to present a Private schooling Credit Self-Certificate Structure to their moneylender.

Bank Prerequisites

Under arrangements of Reality in Loaning Act, private schooling credit moneylenders (counting long haul U-advances and Wellbeing Callings Credits) must:

Give three separate credit revelations to borrowers: one at the place of utilization, one when the advance is supported, and one preceding the advance is dispensed.

Have a holding up time of three to seven work days between the time the borrower gets the last credit exposure and the time the credit is dispensed.

Get a marked self-certificate structure from the understudy prior to dispensing the credit.

Your bank ought to give you these prerequisites. On the off chance that you have questions, co