All of these programs may help ease the burden of paying for college. However, sometimes these sources are not enough to cover all the costs. When that happens, parents and students may take advantage of private student loans, also called alternative loans.
The interest rate on private loans will largely depend on the borrower’s credit rating, so students and parents may have to pay higher interest rates than they would on federal student loans. In addition, many lenders require students to have a cosigner, and some require the college to certify that the student needs the loan.
Students and parents are encouraged to do research before committing to any loan.
