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An alternative student loan is designed primarily to help students and their families pay for educational expenses that exceed other available financial aid resources such as scholarships, grants, and the Federal Family Education Loan Programs (Stafford loan for students and PLUS loan for parents).  In addition, an alternative student loan is a key resource for those students and their families who do not typically qualify for many financial aid programs, but who are without adequate cash reserves to pay for a college education.  Alternative student loans exist to bridge the gap between the full cost of a higher education and traditional financial aid resources.

Alternative student loans should only be considered after all other low-cost, traditional financial aid resources have been fully utilized.  Please keep in mind the following:

• The Federal government does not back these loans
  

• Borrowers and/or co-borrowers must be creditworthy
  

• Lenders may require that the borrower and/or co-borrowers be United States citizens or have permanent resident status
  

• Various origination fees, interest rates, repayment terms, aggregate borrowing limits, and other restrictions may apply
  

• Federal Family Education Loan Programs generally have lower interest rates and more flexible repayment terms
  

• Many lenders do not cap the interest rate when a variable interest rate is offered