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Private loans come to the help of students who require more funds and are in need of financial assistance, but are not eligible for other state or federal sponsored loans. Private loans are not part of the Federal aid programs. Many students who do not qualify for Federal aid are often at a loss as to their next course of action. Not many realize that both undergrad and graduate students are eligible for private student and college sponsored loans offered outside the Federal aid programs. These loan programs are offered by many private lenders and educational institutions.

As soon as you know that you are not eligible for state or federal sponsored student aid programs, you can approach the financial aid office of your school to find out if the institution offers any student loans to help pay for the school. You will be surprised to find that your college may offer student loans at an interest rate that is lower than the Federal government programs. Certain colleges help students cover the costs by offering them a college work-study program.

There are schools that partner with a local bank to offer private loan programs to students. These programs are offered to permanent residents or US citizens. Permanent residents from other countries must be full time students of the university. Schools usually offer $8500 for the first two years and $15,000 for seniors and juniors. A fee between 3 and 5% is charged for the loan.

Alternately, you can go in for private loans. It is not very difficult locating a private funded loan program offered to undergraduate and graduate students. These programs do not come with a Federal government guarantee and are credit based. Here, the interest rates are higher than the Federal programs and school loans. A consolation is that rates are lower than the credit card interest. This is the reason why you must check with all other options before deciding to reach out for a private student loan.

Act Education Loans and the College Board Education Loan Program are some of the prominent private loan options on offer. There is no maximum limit on the loans offered by the College Board. This loan is credit based and allows students to borrow the complete education cost. Connect Loan as it is called is offered by this non-profit organization deducting any other financial aid you may be availing.

Students are offered affordable loans which help them cover the cost of their degree program by the Act Education Loans. This loan is offered only to those who are enrolled and attend at least half time in their degree program at a school that is approved. Here, the borrowing limit annually is $40,000. Undergraduates can avail of a maximum of $130,000. Through all these private student loan programs, students can choose their repayment method which includes deferred payment, interest-only payment and immediate repayment.

Other private student loan options include loans offered by the banks, private financial institutions and credit union. It is in your best interest to research on the pros and cons of each of these loan options before choosing the best one suited to your requirement.