Remember: Always apply for and get all the free money available to you -- whether federal, state or private -- before taking out any student loan.
Apply for all the grants and scholarships available to you from:
- Your college
- Your state program
- From organizations in your community
Next, apply for low-cost federal loans.
If your state offers student loans, check the interest rates and fees before choosing a private loan.
If after exhausting all of these sources of aid, you find you still have a college funding gap, you may consider a private loan to make up the difference.
Private student loans are education loans from banks or other lending institutions - not from the state or federal government.
Private student loans are usually unsecured, which means approval is based on a financial institution's assessment of the borrower's ability to repay. A cosigner is often required.
Interest rates, loan limits, interest capitalization policy, repayment options and prepayment penalties can vary – sometimes considerably – depending on the financial institution underwriting the loan.
When comparing private loan products, compare them based on their total cost: principal plus interest and fees.
Use NCFC's Private Student Loan Comparison Tool to help find the loan that's best for you.