Alternative Loans

Alternative loans are bank loans designed to bridge the gap between educational costs and traditional funding sources, such as federal student and parent loans, grants and scholarships. With Alternative Student Loans you can borrow up to the cost of attendance minus any financial aid you are eligible for.

 

These loans are not federally regulated, so the interest rates can be much higher than the Federal Stafford and Plus Loans. Also, they must be certified, or approved, through the Financial Aid Office. Most of the time these loans will require the student to have a credit-worthy co-signer making the co-signer equally liable for the loan. These loans are also not federally insured against death and disability.

 

Alternative loans should only be used as a last resort option to finance your education. Before you decide to consider an alternative (non-federal) loan, we recommend you:

 

Carefully read the information about the loans. The interest rates are variable and have high maximums.

Explore all other funding sources described on web site

Consider a Parent Loan (PLUS)

Consider the Monthly Payment Plan

 

Tips when shopping for Alternative Loans:

Interest Rates and Fees: A student should look for loans that offer fixed interest rate and no loan fees rather than a variable rate. It is important to keep in mind that many loans’ interest rates are tied to your (and your cosigner’s) credit score.

 

Loan Cosigners:
Lenders may offer a better deal to students who apply with a credit-worthy cosigner.

 

Loan Limits:
Lenders require minimum loan amounts and have maximum loan caps.

 

Lender Availability and Customer Service:
Some lenders offer online applications, e-sign capability, and access to your data via their website. Others may have form downloads that need to filled out and faxed or sent back to the lender. All lenders have contact numbers so you can call to ask questions about their individual processes. The choice is ultimately yours. Students should make sure they have easy access to your loan data, and are able to ask questions if you need.

 

Questions to Ask:
Here is a list of questions that you may find helpful when shopping for private loans. Project on Student Debt.

 

Check your sources:
If you decide to use a lender comparison website, be sure that you know who provides the data. Many of these sites are owned by lenders or only display lenders who pay for a spot on the page.

 

MOST IMPORTANTLY SHOP WISELY!!!

 

Contact the Financial Aid Office with any questions you have at: 518-255-5623 or 1-800-295-8988 or by email at financialaid@cobleskill.edu

 
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