Student Lending FAQ

Federal Loans

How do I apply for financial aid? +

You’ll need to complete the FAFSA® form found on the Federal Student Aid website, which is required to receive financial aid. In addition, there is a second form called CSS profile, required by approximately 250 colleges. To find out if you need to fill out the CSS profile, visit College Board.

When should I apply for financial aid? +

Both forms will be available on October 1 of the student's senior year in high school. Each college may have different deadlines, so be sure to check with each you're applying to, to ensure forms are filled out in time.

How will I know if I qualify for financial assistance after I fill out the forms? +

Every college you listed on your FAFSA form will send you a financial aid award letter in the springtime. This award letter will contain information on any aid you qualify for from the federal government, state government and the college.

Financial aid consists of the following:

  • Scholarships and grants which do not have to be repaid.
  • Federal financial aid loans which do have to be repaid.
  • Available work study jobs on the college campus for students to earn money.
The most important thing is to understand and compare the aid offers from each school. Start with the total cost of each school, including tuition, room and board, fees, meal plans, and books – then subtract the total amount of aid that is being offered by that school. This will leave you with your out-of-pocket costs for each school. You can then look at this out-of-pocket cost for each school and compare them to see what the better offer is. Use this information as one of many factors when considering which school you would like to attend.  
Yes, everyone should apply for financial aid regardless of their income. All students will qualify for low interest rate loans and scholarships may require your results from the aid application as part of the scholarship application.

Private Student Loans

Who is the applicant on a private student loan? +

The most common situation is that the student is the primary borrower, and a parent is a co-borrower. You can also find private student loans that are just in the parent’s name.

Does the student have to have a co-signer? +

If the student can meet the income and credit guidelines on their own, they do not need a co-signer. However, most students do not meet the income and credit guidelines and usually need a co-borrower. In addition, having a co-borrower can help the student qualify for a lower interest rate.

What is the eligibility criteria to be approved for a private student loan? +

Every lender will have their own specific eligibility criteria but in general the qualifications are based on income and creditworthiness. The student usually has to be attending a lender-approved institution in a degree-granting program on at least a half-time or above status.
Some lenders do offer this option with stipulations that a certain number of on-time payments are made first and the student can qualify based on income and credit.
Lenders will have a range of interest rates posted on their website so you can see the lowest and highest interest rates offered at that time. Where you will fall within that range depends on the strength of your creditworthiness and repayment choices.
This depends on the lender; some may make you complete the application before they give you a rate. Other lenders will pre-qualify you in a few minutes with a soft credit check and can provide an estimated rate before you complete the loan process, giving you the ability to shop around for the best rate.
Usually lenders will give you a choice on when repayment begins. You can choose immediate payment, meaning monthly payments will begin one to two months after the loan has been disbursed. You can also select interest-only payments while the student is in school. Payments can also be deferred six months after graduation but interest is accruing during this time so this can be the costliest option.
All student loan lenders will send the money directly to the school. They will work with the school to set the payment dates, which are divided up by semesters.
Yes, the loan money can be used to cover any education-related expenses. The money will still be sent to the school, and they will apply it to the student’s account and refund the money to the student to cover those expenses.
You should apply for a loan no later than 30 days before the school requires payment. Some lenders will let you apply up to 120 days in advance.
The school will send a bill during the summer and this will give you the exact amount due. You can also use your financial aid award letter to get an estimate of how much you will need to borrow.
You can get a rate estimate and pre-qualify in about 15 minutes online.
Yes, extra payments can be made. While most will not charge you a pre-payment penalty, it is best to ask each lender directly. 
Most lenders no longer charge origination fees, but it is always a good idea to ask this question of any lender you are considering.

Student Loan Consolidation and Refinancing

What is the difference between student loan consolidation and refinancing? +

They are usually done together, but if you only have a single loan, you are only eligible for refinancing.

What loan terms are available with student loan refinancing? +

You can choose both variable or fixed interest rate options and loan terms of 5, 7, 10, 15 or 20 years.

Do I need a co-borrower to refinance my loans? +

If you have strong income and credit, you are not required to have a co-borrower.
No, you can refinance your loans multiple times as long the interest rates are in your favor, and it makes sense for your financial situation.

Most lenders do not charge you any closing costs or application fees.

Eligibility is based on income and credit. If the student does not meet this criteria, they can add a co-borrower. Students must be graduates and employed. If a student did not graduate, they could be eligible for the refinance loan after making payments for one year.
Yes, you can do this but should think about it very carefully before you do. Federal loans have repayment benefits such as public service forgiveness options, income-based repayment plans and other options that you will lose if you refinance them into a private student loan.
You can get pre-approved online in a few minutes, but the entire process can take as long as 30 to 60 days.
No, during the closing process you will be asked to provide payoff letters for each loan and the new lender will pay off the loans for you.
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