Educational loans that are not part of the Federal Student Aid program are referred to as alternative or private education loans and are offered by commercial lenders. These loans are made to students and parents and may have fixed or variable interest rates and accrue interest from the time the loan funds are disbursed. These are credit based loans and may require a cosigner. Terms and conditions vary by lender.
St. Catherine University recommends that all eligible degree seeking students apply for financial aid using the Free Application for Federal Student Aid (FAFSA) and exhaust all federal loan program options before considering an alternative education loan. Students may be eligible for federal titleIV financial aid such as the Federal PELL Grant, SEOG and TEACH grants, federal work study, Federal Perkins Loan and Federal Direct Loans and PLUS Loans. The federal loan programs offer terms and conditions that may be more favorable than the provisions of private/alternative education loans. Undergraduate students may be eligible for up to $5550 in Federal Pell Grant funding and up to $5500 in Federal Direct Subsidized Loan and $7000 in Federal Direct Unsubsidized Loan ($2000 for dependent students). Graduate students may be eligible for up to $20,500 in Federal Direct Unsubsidized Loan.
Because the federal loan and grant programs have annual and aggregate limits, many students and families seek additional ways to finance their educational expenses. If you have exhausted all other financial aid resources, you may want to consider an alternative student loan provided by a commercial lender. You will need to choose a loan program, determine your eligibility and be approved by the lender for the loan.
To assist you in selecting a lender, St Catherine University has chosen to participate in a Preferred Lender Arrangement and has provided a list of lenders that have met the Universities criteria as a preferred lender. All preferred lenders must meet the following expectations:
- Have proven stability, reputation and longevity in the student lending business.
- Offer competitive pricing, rates, fees, or other terms and conditions and flexible repayment options.
- Provide quality customer service.
- Offer debt management tools and financial literacy information to borrowers.
- Provide quality loan servicing and default prevention to borrowers.
Borrowers are free to choose any lender for their alternative education loan needs. St Catherine University will accept and certify alternative education loan applications submitted by any lender per the borrowers’ request.
Considering an alternative student loan
Make sure to choose a loan program that is a good fit for you. You should carefully evaluate:
- Loan type
- Fixed rate: The interest rate remains the same over the life of the loan
- Variable rate: The interest rate changes based on pre-defined criteria
- How much the loan will cost over time
- Repayment options and incentives
Typically, eligibility for alternative loans is based on your educational cost of attendance. Enrollment requirements and satisfactory academic progress requirements vary from lender to lender. Some lenders also offer a 'look-back' feature that allows students to apply for loan funds to cover a past-due balance at the school. If you have questions about your eligibility for alternative loans, contact the Financial Aid Office.
Once you apply for an alternative loan, it will be approved or denied by the lender based on your credit worthiness and/or the credit worthiness of your cosigner. Guidelines for credit worthiness are established by the lender and it is at the lender's discretion that your loan will be approved or denied.
Due to recent federal regulations please allow about 30 days from the date of application for the alternative education loan to be processed.
All of the information provided on the Alternative Student Loan page is reviewed annually to ensure that the benefits lenders offer continue to adhere to our criteria. Any loan options that no longer meet our criteria are removed, and new options are added. At least three lenders will be presented at all times.
Tools for determining your costs and calculating your balance are available in the Cost of Attendance Webpage. By selecting your program and then completing a Cost Estimation Worksheet, you can gain a better understanding of your individuals costs, what will be covered by grants and scholarships, and how much you may need to borrow in loan funding or cover through personal resources.
Loan ComparisonsTo compare the terms of the different loans available to you and help determine which loans would best meet your needs, use our loan comparison chart.