No matter what your college plans look like—whether you are earning your bachelor’s degree, PhD, or a specialized certificate—you are going to need the financial security to pay for it. Even if you receive financial aid to cover the costs of your books and classes, you might still need a student loan to cover living expenses while you advance your degree.
What are Private Student Loans?
Private loans are similar to federal loans in the fact that they can be used to pay for school expenses. Taking out a student loan means that you will be responsible for paying back the amount of money borrowed after your grace period—typically six months after graduation or dropping out of school.
Unlike a federal loan, a private student loan is not backed by the government. Instead, this type of college loan is backed by a bank, credit union, or online lender. Federal loans generally have better terms, repayment plans, and do not require a credit check, but there is a limit to how much money you can borrow towards your degree.
Private student loans help fill in the gap so that you aren’t stuck to foot the bill if your federal-issued financial package isn’t enough. Many students are able to secure financial aid and federal loans during their undergrad degree, but financing becomes harder to receive for advanced degrees. This is where private student loans really shine. They are the additional financing option available so you can finish your degree and advance your career.