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One of Uncle Sam’s greatest gifts to the American student is the federal student loan program that makes it possible for millions of young Americans to obtain a higher education. But federal student loans don’t always cover tuition and expenses 100%. That’s why so many parents and students are turning to private student loans to fill the gap.

Private student loans, not just for tuition!

All the talk these days is about higher college tuition costs. But what’s often overlooked are all the other college expenses that can make going to college more financially daunting.

However, that may not be a problem for you, as most private loans can cover virtually all of your college expenses, including: Room and board Off-campus lodging Registration fees Textbooks Laptop/access to Internet Travel expenses to arrive and classes

How can you qualify for a private loan?

Because private loans are made by private institutions, such as a bank or other private lending institution, your ability to obtain a loan will be based on merit, specifically good credit, essentially a high enough credit score. The availability of a co-signer with good credit is even better from a lender’s perspective because, given a co-signer’s good credit, their combined probability of repaying the loan is greater. Therefore, the lender is more likely to approve you for a private loan.

If you think about it, most consumer loans require collateral, like a house or a car. If a borrower defaults on the loan, then the lender can repossess the property from him, so he can sell it to get back the money he had lent.

In the case of education loans, there is really no collateral; that is, how can a lender recover the education from him? it can’t. That’s why lenders rely on good credit because it’s a strong indicator that you and/or your co-signer have a proven history of paying your credit cards or other loans in a timely and responsible manner.

Good credit co-signers can help you qualify for a private loan, lower your borrowing costs and improve your credit score!

Because private loans are merit-based, the rate you receive is based on your credit history and income. If you don’t have one or the other or both, having a creditworthy co-signer can be invaluable. In fact, a good credit co-signer can help you get a private loan at a lower interest rate, saving you a ton of money over the life of the loan.

Another added benefit of a credible co-signer is “guilt by association, but in a good way.” This means that responsible and timely payment of your private loan under a co-signer agreement will be a positive way to build your own credit history.

Take advantage of the benefits of private loans

Of course, the main purpose of taking out a student loan is to help you get a solid education so you can pursue your career aspirations. And using credit wisely is important. That’s why we encourage you to seek out as much federal student aid, grants, and scholarships as possible before applying for a private loan.

Private Loan Application Process – Get Pre-Approved in Minutes if You Qualify!

However, once you determine that a private student loan may be a viable alternative funding source to fill your education financial gap, you could be pre-approved for a private loan within minutes of applying! Many times, the application process is very simple and, with most lenders, can even be handled over the phone or online.

Longer prepayment terms and no prepayment penalties can help you better manage your cash flow after college

When it comes to paying off your private loans, many lenders give you up to 20 or 25 years to do so. The absence of prepayment penalties means that as long as you make your minimum monthly payment, you can pay off your loans as fast or as slow as you like within your repayment term.

Interest rate discounts can help lower the cost of private loans even further!

Many private loan lenders would like to have your business. So be sure to shop around and ask each lender about these and other “borrower benefits” of private loans, such as:

o An interest rate discount for automatic payment from a checking or savings account

o An interest rate discount simply for making payments on time.

o Little or no origination fees, if you or your co-signer have good credit

Who is eligible for a private loan?

Please note that each private loan lender has certain eligibility requirements. For most private student loans, you must meet the following criteria:

– Must be a creditworthy applicant or have a creditworthy co-borrower

– Must be a US citizen, US permanent resident, or international student with a qualifying US citizen or US permanent resident co-signer.

– You must be within the age of majority based on your state of residence (usually 18 years of age)

– May be a full-time, part-time, or less than half-time student (including continuing education)

Types of private loans

The great thing about private loans is that many lenders have a variety of loans that are tailored to your specific course of study. The loan name, minimum and maximum loan amounts, and loan repayment terms are tailored to the typical needs of the course of study you have chosen to pursue.

Private Undergraduate Loans – Just as the name suggests, apply for a private college student loan if you are a college student or attending a trade, technical, or career school in the US, at least part-time. Private Continuing Education Loans – This private loan is right for you if you are completing a degree, certificate program, or taking classes for career advancement or personal development. A private continuing education loan is available to you if you attend an eligible school at least half time (less than half time). Graduate/Professional Private Loan – If you have decided to pursue an advanced degree at participating colleges and universities, and plan to attend at least half time, then this private loan may provide the funds you need to reach your educational goals. Education K-12 Private loan – If you are a parent or other sponsoring adult (relative or friend) of children attending participating nonpublic elementary schools, many lenders provide these loans to help cover expenses. Most lenders offer private K-12 education loans for students attending private, religious, military, or special education high schools.

Do you need more money to pay for college? Private loans are here for you!

Now that you’ve learned about an alternative way to pay for your college-related expenses, don’t let anything stop you from pursuing the dreams of success you desire. A great education is a wonderful thing and nothing should stand in your way of achieving your goals.

As you begin or continue your education, the availability of private loans offers you an option to finance your education when you don’t know where else to turn for the money you need.

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