Financial Aid: Alternative Loans
To supplement or to replace federal Stafford Loans for students and federal PLUS Loans for parents, private lenders (such as banks and some states) offer “alternative loans” to parents and students. They help the borrower pay parent contribution, student contribution, or cover an aid gap. The amount of the loan should be no greater than the difference between the Cost of Attendance and aid that has been awarded. Some lenders will allow payment to begin six months after the student has completed school or is no longer enrolled full time. When the student is the borrower, a credit-worthy cosigner is usually required. If you need this type of loan, find out what is available and compare rates and terms.