dcsimg

The Truth about Private Education Loans

By Joe Aguilar

According to the Council of Graduate Schools, the average cost of graduate school has skyrocketed by 60 percent within the last decade. This huge university price hike has helped private student loans become the fastest-growing source of college financial aid. In 2005-2006, for example, college students borrowed $17.3 billion dollars in private loans. If you're thinking about taking out private loans to help pay for your on-campus or online master's degree, you need to understand the facts.

Would I Qualify for a Private Loan?

To be eligible for private loans, you should first meet the following requirements:

  • Have an official Social Security number
  • Have no defaults on any prior student loans
  • Have a clean credit record
  • Be a U.S. citizen or permanent resident status
  • Have a co-borrower if you are a foreign-born student

So how do private loans differ from federal loans? First, federal loans are awarded based on your financial need as determined by information you submit on the Free Application for Federal Student Aid (FAFSA), while private loans are granted based on your credit record. Although private loans offer certain advantages, you should also be aware of potential risks.

Benefits of Private Loans

  • You don't have to prove your financial need to obtain private loans
  • May have lower rates than standard loans
  • Fast approval and quick disbursement of funds
  • Possibility of rate reductions for on-time payments

Downsides of Private Loans

  • Interest rates are not standardized and can swing dramatically
  • Do not qualify for federal consolidation
  • Potentially misleading marketing campaigns
  • Generally do not offer loan deferment options

Because private loans carry interest rates that can change over time, make sure to exhaust all your federal funding before applying for private loans. Recent changes to federal rules allow federal financial aid for students of online degree programs. Also, you may find other ways to pay for your master's degree, such as school-based work-study programs, federal grants, university teaching assistantships, private scholarships, and a part-time job.

Sources

 


Schools Offering Related Degree Programs

Campus Type :
Zip :

Matching School Ads
Ashford University

You've found Ashford University, where school comes to you. Earn your bachelor's or master's degree online.

Full Sail University - Online

Push Your Creativity To The Next Level

Colorado Technical University Online

A degree from CTU connects you to what matters most: powerful professional network, real-world professional faculty and innovative technology. Once you earn your degree you hit the ground running.

Regent University

Regent University prepares students with the knowledge to excel and the faith to live with purpose.

Rutgers University

Founded in 1766, Rutgers, The State University of New Jersey, is a leading national public research university and the state’s preeminent, comprehensive public institution of higher learning.


University of San Francisco

If you want to make the world a better place, start at the University of San Francisco. Our 21st-century mission to create a more humane and just world comes alive in our diverse learning community and is broadened by our global orientation. You are challenged to reach higher standards and to use your education to promote justice and serve the common good. At the University of San Francisco, youll find the excellence inherent in an institution established over 150 years ago, and inherent in nearly five centuries of Jesuit education.

Milken Institute School of Public Health at the George Washington University

Located in the heart of Washington, D.C. the Milken Institute School of Public Health at the George Washington University is dedicated to advancing the health of local, national and global communities.

You need to have a Bachelor’s degree to be qualified for this school.


Adelphi University

Adelphi University’s roots reach back to 1863 and the founding of the Adelphi Academy, a private preparatory school in Brooklyn, New York. The Academy was incorporated in 1869 and its Board of Trustees was charged with establishing a first class institution for the broadest and most thorough training, and to make its advantages as accessible as possible to the largest numbers of our population. The school quickly gained a reputation for its innovative curriculum, particularly in physical culture and early childhood education.

Jacksonville University

The University

With over 80 years of academic achievements, Jacksonville University is a traditional, longstanding institution consistently ranked by U.S. News & World Report as one of America's best colleges.


Matching School Ads