Private Loans
Private loans, sometimes called "Alternative" or "Outside Agency" Loans, are funded through banks and other private lending institutions.
For some, these loans serve to bridge the gap between the cost of their education and the amount of money the government allows them to borrow in the federal loan programs (Perkins, Unsubsidized Direct Loan and Subsidized Direct Loans). Others turn to private loans when they need more flexible repayment options. For example, some parents might want to defer their repayment until their student graduates; this option is not available from the federal PLUS parent loan programs but may be available from private lenders. However, terms and conditions are generally not as good as for federal loans.
See answers to these frequently asked questions below:
Should I apply for a private loan?
Will I qualify? How much can I borrow?
Which lender is right for me?
How do I apply?
How will I receive my loan funds?
Should I apply for a private loan ?
Since the Department of Education does not regulate private educational loans their terms and conditions can vary widely. We only recommend you consider private loans if you need more money after taking the federal student loans for which you qualify. In general, federal loan terms are better than private loan terms.
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Will I qualify? How much can I borrow?
Eligibility criteria for private student loans vary, but often depend in part on your credit score. The Financial Aid Office can only certify loans for up to a maximum of the difference between your Cost of Attendance and the financial aid you have been awarded. This information can be calculated using information on MyUCSC.
- Login to MyUCSC (my.ucsc.edu)
- From the menu, click on "Financial Aid"
- Next click on "My Financial Aid"; the "Select Aid Year to View" page will display.
- Click the Aid Year you wish to view; the "Award Summary" page will display.
- Click the "Financial Aid Summary" link at the bottom left of the page.
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Which Lender is right for me?
We encourage you to consider all options when choosing a private loan. It is important to research and compare the characteristics of each loan to find the best possible loan for your needs. If you anticipate continuing your studies beyond your current program, pay particular attention to deferment options. Be an informed consumer. Here are some questions you should consider:
- How much can I borrow?
- What fees are associated with the loan?
- What is the interest rate on the loan?
- How is the interest rate calculated?
- What are the terms of repayment?
- How much will my payments be if I borrow $x?
- Do I need a co-signer?
The following is a list of lenders which offer the best available loan terms for UC students. For more information, please follow the links to lender websites:
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How do I apply?
Contact your chosen lender for pre-approval or fill out an application online. After submitting your application, the lender may send you a request for additional information. Please respond quickly to all requests to insure prompt receipt of funds. After all additional information is received and your loan approved, the lender will contact UCSC to certify the loan. Once we have confirmed your eligibility we will certify the amount of your loan and return an electronic response to your lender. Following final loan approval, your lender will send funds to UC Santa Cruz for disbursement to your student billing account.
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How will I receive my loan funds?
Your Private Loan funds will be disbursed evenly among the terms you enroll. UCSC receives most private loan funds electronically from the lender and will credit your student billing account when funds are received. To receive funds, you must be enrolled in at least 6 units. Occasionally a lender sends funds in the form of a check to the Financial Aid Office. In this case, you will be notified via email or phone with instructions on how to receive the funds. To find out the status of your loan, call (831) 459-2963.
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