What Is a Private Student Loan and Who Is Eligible?
When you take out a private student loan, the lender pays for your college degree and associated expenses. You repay these funds over time according to the loan agreement. You can use your loan to cover tuition, fees, books, supplies, and living expenses.
You’re eligible for a student loan if you’re enrolled at an eligible school, are at least 18 years old, and have a high school diploma or an equivalent. Most lenders will also require you to be a U.S. citizen or permanent resident.
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How to Apply for a Private Student Loan?
Once you select a private student loan offer that meets your needs, you’ll need to complete a full application. Usually, you’ll have to provide proof of identity, address, and financial status.
If you’re applying with a cosigner, you’ll need to provide their information as well. It’s a good idea to gather your pay stubs, tax forms, and other related documentation to stay ahead of the game. You will also need proof of acceptance at a qualifying college or university.
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How Does the Student Loan Process Work?
After you submit your private student loan application, the lender reviews your paperwork to make sure you meet its qualifications. Generally, you can expect an answer to your application in 5-7 business days.
Once you receive approval, most lenders send the money to your school’s financial aid office. However, you may be able to request direct funds to cover books, supplies, and approved living expenses.
After you receive your funds, the loan starts accruing interest right away. You can save money over the life of the loan by making interest-only payments while in school. Most lenders also let you defer payments until you graduate, sometimes after a grace period of about six months.
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What Are the Requirements for a Student Loan?
You’ll need good credit and a steady strong income to qualify for a private student loan. Different lenders have different standards, but most ask for a credit score of at least 640 and earnings of at least $24,000 per year.
If you’re not quite there yet, applying with a cosigner will seriously increase your chances of private student loan approval. Your cosigner will need to meet the requirements and agree to take responsibility if you can’t repay your loan. Many lenders offer cosigner release after you make a certain number of on-time payments.
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How to Choose the Right Student Lender for You?
When comparing private student loan options, the offer with the lowest interest rate may seem tempting. You can use a student loan calculator to see how much you will pay in total, including interest and fees.
While an affordable APR does play a role in choosing the right student loan, you should also consider the available repayment terms and options. For example, you might want to give yourself time to earn money after graduation by choosing a lender with a generous grace period.
Different lenders offer different customer service channels, so make sure the one you select can work with your preferred contact method. In other words, don’t choose a tech-averse company if you use your mobile to manage your finances.
Finally, you might want to consider other benefits offered by each lender. Some student loans come with advantages like autopay discounts, hardship forbearance, and automatic cosigner release.
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FAQ
What’s the difference between an adjustable and a fixed-rate student loan?
A fixed-rate student loan maintains the same interest rate for the life of the loan. You can only get a new interest rate if you refinance. An adjustable-rate loan has a fixed rate for the first few years, then the APR changes based on the federal interest rate and other factors established in your loan documents.
Will applying for a student loan affect my credit score?
Your credit score may decrease when you apply for a student loan, which occurs when the lender does a so-called “hard” credit pull. Student loans also affect your debt-to-income ratio, a factor that compares how much you owe to how much earn. Over time, however, paying back your student loan as agreed will have a positive effect on your score.
How long does the student loan application process take?
Some lenders have short processing times, generally 7-10 business days. Others can take two to four weeks to complete the private student loan application process. If you need funds quickly, you may want to look for lenders that have a reputation for fast approval and disbursement.
What do student lenders consider when reviewing applications?
Lenders make sure that you have the income to make payments on the loan. They also review your credit score to determine the risk associated with lending to you. Other factors that play into the approval decision include the school you will attend, the type of degree program, your citizenship status, whether you have a cosigner, and the amount you want to borrow.
How do I choose the right term for my student loan?
The answer depends on your financial goals. If you want lower monthly payments, you should select a longer term to pay back your loans. If you want to get out of debt as quickly as possible, you can save significantly on interest with a shorter loan term. You can also balance these priorities with a term somewhere in the middle.
Disclosures:
Sallie Mae Disclosure:
Borrow responsibly
We encourage students and families to start with savings, grants, scholarships, and federal student loans to pay for college. Students and families should evaluate all anticipated monthly loan payments, and how much the student expects to earn in the future, before considering a private student loan.
Explore federal loans and compare to make sure you understand the terms and features. Private student loans that have variable rates can go up over the life of the loan. Federal student loans are required by law to provide a range of flexible repayment options, including, but not limited to, income -based repayment and income-contingent repayment plans, and loan forgiveness and deferment benefits, which other student loans are not required to provide. Federal loans generally have origination fees, but are available to students regardless of income.
1. Advertised APRs for undergraduate students assume a $10,000 loan to a student who attends school for 4 years and has no prior Sallie Mae-serviced loans. Interest rates for variable rate loans may increase or decrease over the life of the loan based on changes to the 30-day Average Secured Overnight Financing Rate (SOFR) rounded up to the nearest one-eighth of one percent. Advertised variable rates are the starting range of rates and may vary outside of that range over the life of the loan. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. To receive a 0.25 percentage point interest rate discount, the borrower or cosigner must enroll in auto debit through Sallie Mae. The discount applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment.
2. Although we do not charge a penalty or fee if you prepay your loan, any prepayment will be applied as outlined in your promissory note—first to Unpaid Fees and costs, then to Unpaid Interest, and then to Current Principal.
3. For applications submitted directly to Sallie Mae, loan amount cannot exceed the cost of attendance less financial aid received, as certified by the school. Applications submitted to Sallie Mae through a partner website will be subject to a lower maximum loan request amount. Miscellaneous personal expenses (such as a laptop) may be included in the cost of attendance for students enrolled at least half-time.
4. Based on a comparison of approval rates for Sallie Mae Smart Option Student Loans for undergraduate students who applied with a cosigner versus without a cosigner during a rolling 12-month period from October 1, 2022 through September 30, 2023.
5. Examples of typical costs for a $10,000 Smart Option Student Loan with the most common fixed rate, fixed repayment option, 6-month separation period, and two disbursements: For a borrower with no prior loans and a 4-year in-school period, it works out to a 10.28% fixed APR, 51 payments of $25.00, 119 payments of $182.67 and one payment of $121.71, for a Total Loan Cost of $23,134.44. For a borrower with $20,000 in prior loans and a 2-year in-school period, it works out to a 10.78% fixed APR, 27 payments of $25.00, 179 payments of $132.53 and one payment of $40.35 for a total loan cost of $24,438.22. Loans that are subject to a $50 minimum principal and interest payment amount may receive a loan term that is less than 10 years. A variable APR may increase over the life of the loan. A fixed APR will not.”
College Finance is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
SALLIE MAE RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS, SERVICES, AND BENEFITS AT ANY TIME WITHOUT NOTICE.
© 2025 Sallie Mae Bank. Sallie Mae loans are made by Sallie Mae Bank. Sallie Mae, the Sallie Mae logo, and other Sallie Mae names and logos are service marks or registered service marks of Sallie Mae Bank. All other names and logos used are the trademarks or service marks of their respective owners.
SLM Corporation and its subsidiaries, including Sallie Mae Bank, are not sponsored by or agencies of the United States of America. W646400 0325
Information valid as of 04/17/2025.
College Ave Disclosure:
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
(1)All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation.
(2)As certified by your school and less any other financial aid you might receive. Minimum $1,000.
(3)This informational repayment example uses typical loan terms for a freshman borrower who selects the Flat Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7.78% fixed Annual Percentage Rate (“APR”): 54 monthly payments of $25 while in school, followed by 96 monthly payments of $176.21 while in the repayment period, for a total amount of payments of $18,266.38. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
Information advertised valid as of Monday, 03/03/2025. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of the Flat Repayment Option with the shortest available loan term.
Credible Disclosure:
¹ Student Loan Rate and Terms Disclosure: Rates displayed include Automatic Payment and Loyalty Discounts, where applicable. Note that such discounts do not apply while loans are in deferment. The lenders on the Credible.com platform offer fixed rates ranging from 3.49% - 17.99% APR and Variable interest rates from 4.50% - 17.99% APR. Variable rates will fluctuate over the term of the borrower’s loan with changes in the Index rate. The Index will be either LIBOR or SOFR. Rates are subject to change at any time without notice. Your actual rate may be different from the rates advertised and/or shown above and will be based on factors such as the term of your loan, your financial history (including your cosigner’s (if any) financial history) and the degree you are in the process of achieving or have achieved. While not always the case, lower rates typically require creditworthy applicants with creditworthy co-signers, graduate degrees, and shorter repayment terms (terms vary by lender and can range from 5-20 years) and include Automatic Payment and Loyalty discounts, where applicable. Loyalty and Automatic Payment discount requirements as well as Lender terms and conditions will vary by lender and therefore, reading each lender’s disclosures is important. Additionally, lenders may have loan minimum and maximum requirements, degree requirements, educational institution requirements, citizenship and residency requirements as well as other lender-specific requirements. Lenders will conduct a hard credit pull when you submit your application. Hard credit pulls will have an impact on your credit score.
SoFi Disclosure:
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student’s at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. View payment examples.
Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is current as of 4/22/2025 and is subject to change. SoFi Private
Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org).
0.125% Continuing Scholar Discount: Terms and conditions apply. Offer good for private student loan customers who have previously borrowed a private student loan from SoFi and are taking out a subsequent loan only, select a term and repayment type that is eligible for the discount, and is subject to lender approval. To receive the offer, you must: (1) complete a loan application with SoFi; and (2) meet SoFi’s underwriting criteria. Once conditions are met and the loan has been disbursed, the interest rate shown in the Final Disclosure Statement will include an additional 0.125% rate discount because you have borrowed a private student loan from SoFi in the past. Offer good for existing private student loan borrowers only. Offer cannot be combined with other rate discounts, with the exception of the 0.25% autopay rate discount. SoFi reserves the right to change or terminate the Rate Discount Program to unenrolled participants at any time with or without notice.
Ascent Disclosure:
Ascent’s undergraduate and graduate student loans are funded by Bank of Lake Mills or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations; and terms and conditions may apply. For Ascent Terms and Conditions please visit: AscentFunding.com/Ts&Cs. Rates are effective as of 7/8/2024 and reflect an automatic payment discount of either 0.25% (for credit-based loans) OR 1.00% (for undergraduate outcomes-based loans). Automatic Payment Discount is available if the borrower is enrolled in automatic payments from their personal checking account and the amount is successfully withdrawn from the authorized bank account each month. For Ascent rates and repayment examples please visit: AscentFunding.com/Rates. 1% Cash Back Graduation Reward subject to terms and conditions. Cosigned Credit-Based Loan student must meet certain minimum credit criteria. The minimum score required is subject to change and may depend on the credit score of your cosigner. Lowest rates require interest-only payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the repayment examples above, based on the amount of time you spend in school and any grace period you have before repayment begins.
Earnest Disclosure:
Student Loan Origination (Private Student Loan) Interest Rate Disclosure:
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.54% APR to 16.74% APR (excludes 0.25% Auto Pay discount). Variable rates range from 5.87% APR to 17.10% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan origination loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. Although the rate will vary after you are approved, it will never exceed 36% (the maximum allowable for this loan). Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.
Abe Disclosure:
Before applying for a private student loan, DR Bank and Monogram recommend exhausting all financial aid alternatives including grants, scholarships, and federal student loans.
The Abe SM student loan is made by DR Bank, Member FDIC (“Lender”). All loans are subject to individual approval and adherence to Lender’s underwriting guidelines. Program restrictions and other terms and conditions apply. LENDER AND MONOGRAM LLC EACH RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. TERMS, CONDITIONS AND RATES ARE SUBJECT TO CHANGE AT ANY TIME WITHOUT NOTICE.
1. Interest rates and APRs (Annual Percentage Rates) depend upon (1) the student’s and cosigner’s (if applicable) credit histories, (2) the repayment option and repayment term selected, (3) the expected number of years in deferment, (4) the requested loan amount and (5) other information provided on the online loan application. If approved, applicants will be notified of the rate applicable to your loan. Rates and terms are effective as of 5/1/2025. The variable interest rate for
each calendar month is calculated by adding the 30-Day Average Secured Overnight Financing Rate (“SOFR”) index, or a replacement index if the SOFR index is no longer available, plus a fixed margin assigned to each loan. The SOFR index is published on the website of the Federal Reserve Bank of New York. The current SOFR index is 4.375% as of 5/1/2025.
The variable interest rate will change if the SOFR index changes or if a new index is chosen or if you automatically qualify for In-School Default Protection (see footnote 5 for details). The applicable index or margin for variable rate loans may change over time and result in a different APR than shown. The fixed rate assigned to a loan will never change except as required by law or if you request and qualify for the on-time payment discount or auto pay discount or automatically qualify for In-School Default Protection (see https://www.abestudentloans.com/footnote 5 for details).
2. APRs assume a $10,000 loan with one disbursement. The high APRs assume a 5-year term with the Interest-Only Repayment option, a 37-month deferment period, and a six-month grace period before entering repayment. The low APRs assume a 7-year term, and the Immediate Repayment option with payments beginning 30-60 days after the disbursement via auto pay (see footnote 3 for details). 3 Auto Pay Discount: Earn aAuto pay yields 0.25% interest rate reduction for making automatic payments from a bank account (“auto pay discount”) by completing the direct debit form provided by the Servicer. The auto pay discount is in addition to other discounts. The auto pay discount will bewhich is applied after the Servicer validates your bank account information. Automatic payments and the associated discount will be temporarily discontinued (1) if you elect to stop automatic deduction of payments and (2) during periods when you are not required to make payments. The discount will be permanently discontinued in the event three automatic deductions are returned by the financial institution for any reason.
3. Find My Rate: In order to estimate your available rates and loan options, DR Bank will perform a soft credit inquiry, as authorized by you. Soft credit inquiries do not affect your credit. If available, the rates and loan options offered to you are estimates only. Once you submit your application, DR Bank may perform a hard credit inquiry, as authorized by you. Loan approval, options, and final rates depend on the verification of information provided on your application, and information obtained from the credit inquiries of the student applicant and, if applicable, the cosigner.
4. Loan Terms and Repayment Options: The 15-year and 20-year repayment terms are only available for loan amounts of $5,000 or more. Any student applicant who applies for a loan the month of, the month prior to, or the month after their graduation date, as stated on the application or certified by the school, will only be offered the Immediate Repayment option. The Interest Only option (defer principal payments), Flat Payment Repayment option ($25 monthly payment) and
the Full Deferment option (defer principal and interest payments) are only available while the student is enrolled at an approved school. The Flat Payment Repayment option ($25 monthly payment) is only available on loans of $5,000 or more. With the Immediate Repayment option, the first payment of principal and interest is due approximately 30-60 calendar days after the final disbursement date and the minimum monthly payment will be $50.00. There are no prepayment penalties. Making interest only or flat interest payments during deferment will not reduce the principal balance of the loan. Payment examples (all assume a 14-month deferment period, a six-month grace period before entering repayment, no auto pay discount, and the Interest Only Repayment option): 5-year term: $10,000 loan, one disbursement, with a 5-year repayment term (60 months) and a 9.60% APR would result in a monthly principal and interest payment of $210.51. 7-year term: $10,000 loan, one disbursement, with a 7-year repayment term (84 months) and a 8.82% APR would result in a monthly principal and interest payment of $159.98. 10-year term: $10,000 loan, one disbursement, with a 10-year repayment term (120 months) and a 8.57% APR would result in a monthly principal and interest payment of $124.36. 15-year term: $10,000 loan, one disbursement, with, a 15-year repayment term (180 months) and a 8.48% APR would result in a monthly principal and interest payment of $98.36. 20-year term: $10,000 loan, one disbursement, with, a 20-year repayment term (240 months) and a 8.62% APR would result in a monthly principal and interest payment of $87.54.
Abe is a service mark of Monogram LLC.
Monogram LLC is not an affiliate of DR Bank.
Monogram LLC (NMLS #2542102) NMLS Consumer Access
Citizens Bank
1. Student Loan Rate Disclosure: Variable interest rates range from 4.99% - 15.51% (4.99% - 15.47% APR). Fixed interest rates range from 3.49% - 15.49% (3.49% - 14.99% APR).
2. Get My Rate: Selecting “Get My Rate” only requires a “soft credit pull” which does not affect your credit score. Submitting a full application will result in an inquiry on your credit report.
3. Citizens Undergraduate Booked Loans from 10/1/2023 through 9/30/2024 were 4 times more likely to be approved with a qualified cosigner.
4. Multi-Year Approval: Funds available for future use are subject to a soft credit inquiry at time of your next request to verify continued eligibility. After we make the initial Loan to you, you must continue to meet eligibility criteria to obtain additional funds under the Multi-Year Approval feature.
Terms and conditions are outlined in the promissory note. Multi-Year Approval borrowers have a 99% approval rate on future requests for additional funds. The additional funds approval rate is based on the percentage of approved Multi-Year borrowers from Citizens between October 1, 2023 and October 1, 2024. The approval rate represents only borrowers who had previously accepted the Multi-Year Approval offer. Please Note: International students are not eligible for Multi-Year Approval.
