Alternative/Private Student Loans
Alternative student loans, sometimes called private student loans, are loans a student takes out directly from lending institutions to assist with college related costs. Alternative student loans can be used for any education-related expenses including tuition, books, transportation, and room and board. Approval is generally based on the student’s credit.
Filing a FAFSA is strongly suggested as most students will qualify for a Federal Direct Loan which generally offers better loan terms. If a certification request is received and we have not received the results of a FAFSA, we will send you an email encouraging you to apply. If you have no intention of filing a FAFSA, please let us know.
Be Smart About Borrowing – Things You Should Know Before Applying for an Alternative Loan
- What is the lowest interest rate and fee combination you offer? Is this for the life of the loan?
- Is the interest rate a fixed rate and what will my payments be on this loan?
- Is there any penalty for paying off the loan early?
- When do I have to start making payments and how long will I be repaying the loan?
- Can I defer payments while I’m in school? How long can I defer payments while in school?
- If I do not make payments while in school, how much will I owe when I do start making payments?
- If I have difficulty making payments, do you allow me to defer or reduce my payments temporarily? If the answer is yes, under what circumstances, and for how long?
- Will I lose any discounts with just one late payment or if I ask for a change in the payment schedule?
- Are your discounts guaranteed, or are they subject to change later?
Choosing a lender
Many factors vary among lenders so it’s in your best interest to research different alternative loan products and choose one that best fits your needs and circumstances both in the short and long-term.
If you apply for an alternative loan, the lender is required to obtain a signed self-certification form from you. This is a federal requirement through the Truth in Lending Act (TILA) and the Higher Education Act of 1965, as amended (HEA).
How do I apply?
- Determine the amount you need to borrow – borrow only what you need and evaluate if you can reduce or cut out some of your monthly expenses to avoid over borrowing.
- Choose a lender.
- Apply with that lender – most lenders have an online application. If you are applying with a co-signer, they will need to complete an online application as well. Your application is not complete and will not be processed until everything has been submitted to the lender.
- Lender may require proof of income or other documents to complete your application.
- Moraine Park Technical College (MPTC) Financial Aid will be notified by your lender that you have completed the application. The lender requires us to verify you are eligible to receive the loan. This is called the certification process.
- The lender sends you a Final Disclosure. After a regulatory waiting period (3-9 days), the lender sends the funds to MPTC Financial Aid electronically and we will disburse it according to the disbursement schedule.
- Students are encouraged to enroll in e-Refunds if they have not done so already.