Apr 13 2017

Private Alternative Loans: How to Plan, Decide, and Apply – The Office of Student Aid #bill #consolidation #loans

#student private loans

Private Alternative Loans: How to Plan, Decide, and Apply

Private alternative loans are managed through private lenders, issued in the student’s name, and require a co-signer. Eligibility, rates, terms, and conditions vary. Approval and interest rates are based on the borrower’s and co-signer’s credit ratings. Alternative loans are agreements between the borrower, co-signer, and the lender.

Plan ahead

The Truth in Lending Act (TILA) requires you to complete and submit a self-certification form to all lenders for each individual application.

The terms and conditions of federal student aid may be more favorable than the provisions of private alternative loans.

If your lender does not provide the form, print and complete the Private Education Loan Applicant Self-Certification. You can find your cost of attendance and estimated aid for the period of enrollment covered by the loan on your Student Aid Summary on eLion. Return the self-certification form to your lender.

TILA also requires lenders provide you with three disclosures:

  • upon your application
  • when you are approved
  • at least three days prior to disbursement

Timing of the last disclosure may delay loan disbursements by an additional one to two weeks so plan accordingly.

Penn State cannot in any way be held liable in the event the borrower is dissatisfied with the rates, terms, or service provided by any lender.

Make informed decisions

Be sure private alternative loans are the right option for you.


Apply within 90 days of the start of the semester. Schedule all courses before you apply. Increases may not be possible after the loan is certified.

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