How to Apply for a Private Student Loan

If you have selected a lender and are ready to apply for a private student loan, you may want to have the following information handy:

  • Social Security Number
  • Driver’s License
  • Income Information
  • Requested Loan Amount

It may also be helpful if your co-signer is present, so that you can fill out your lender’s application together.

You can use our College Loan Calculator if you need help in determining how much to request from the lender.

Step 1: Research Loan Terms
  • Interest Rate & Fee Disclosures – Take a look at each lender’s disclosures of potential interest rates and fees before you apply.
  • Repayment Options – Evaluate how long your private loan term will be and how much you will need to repay. You may also want to know what kind of repayment plans each lender offers.
  • Deferment & Forbearance – Find out which private loans come with deferment or forbearance options to help you in the event you run into future financial hardship.
  • Borrower Benefits – If offered, compare any lender benefits, such as rebates for on-time payments, interest-rate reductions for making payments using automatic withdrawal (ACH), or graduation rewards.
  • Customer Service – Make sure you are aware of the quality of service the lender and/or servicer will provide for you, as you may be working with them for 10-20 years or more.
Step 2: Complete the Application
  • If you are applying online, you (and your co-signer) will likely enter your personal information and credit check authorization, and then receive a credit decision online or via mail, depending on the lender’s process.
  • Once you review your loan terms, you’ll probably need to accept the loan terms and sign a promissory note to complete the loan application process.
  • Remember, as part of the application process, you may need to provide income or identity verification documentation. Some lenders may allow you to scan and upload your private loan documents online, which can reduce processing time. Otherwise, you may need to mail or fax your documents.
Step 3: Disbursement of Funds
  • Many private loans need to be school certified, meaning the lender will verify your enrollment and loan amount with your school before funds can be disbursed.
  • Your funds will either be disbursed to your school (most likely scenario) or sent to you via check. Contact your school’s Financial Aid Office to provide you with details about how funds are disbursed.

Need Help?

Need help deciding exactly how much to borrow on your next private student loan? A College Expense Worksheet can help you plot your expenses and determine how much money to apply for.