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.
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 . 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.
Be sure private alternative loans are the right option for you.
- Calculate your estimated monthly payment and total repayment amount
- Review your Loan Debt Summary on eLion for current loan obligations
- Budget wisely and borrow only what you need
- Compare private alternative loan terms
- Compare private alternative loans with the Parent PLUS Loan
- Ask questions
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.
2015-16 Loan Term Dates*
Fall/Spring: August 2015 – May 2016
Fall only: August – December 2015
Spring only: January – May 2016