...you use an Alternative Loan as a final resource after exploring all other sources of financial aid, including Stafford and PLUS Loans, if applicable.
...you borrow conservatively. Apply only for what you need and keep in mind that you may need to borrow each year you are in school to help meet the cost of education. Plan accordingly and keep loan debt manageable.
...you do your homework when shopping around for a lender and choose a lender who best suits your needs as a borrower. Be aware of interest rates, fees and repayment terms before you complete the application and promissory note.
...you apply with a credit-worthy co-signer. Doing so may provide you with an increased chance of approval and a more competive interest rate; please be aware, however, that co-signers are equally responsible for the repayment of the loan.
Alternative Loans are private educational loans that are available to students in need of additional assistance after all other types of funding have been exhausted. You, the student, will be the borrower of the Alternative Loan; however, you may need a credit-worthy individual to act as a co-signer.
How much am I eligible to borrow?Although some lenders limit the amount that you may borrow annually, the general rule of thumb is that you may borrow up to the cost of attendance less any other financial aid you may be receiving. For example, the cost of attendance is $20,000 and you are receiving $8,000 in other aid. You would be eligible to borrow up to $12,000, as long as your lender does not have an annual borrowing limit less than $12,000.
What is the interest rate?The interest rates on Alternative Loans vary from lender to lender and are generally higher than those of both Stafford and PLUS Loans.
When does repayment begin?Repayment terms and conditions also vary from lender to lender. Some lenders offer delayed repayment options, and others require interest only or principal and interst payments while the student is enrolled in school. Please be advised that the interest on delayed repayment options begins to accrue immediately, so you should try to make payments on your Alternative Loan if possible.
Students and their families may choose the Alternative Loan Lender of their choice. Your choice of a lender, other than those listed, will not result in the denial or a delay of processing. Upon application, the lender of your choice will forward a certification request to the Financial Aid Office.
1. Complete and submit an alternative loan application to the lender of your choice. Ensure all necessary information is included, such as co-signer information, proof of income, etc.
2. The lender will perform a credit check and determine your eligibility. If all necessary paperwork is complete and the borrower and co-signer meet the credit requirement, the lender approves the loan; if not, the lender may request additional information from the borrower or co-signer.
3. After the borrower actively accepts the loan, the lender notifies Pitt-Johnstown's Financial Aid Office to complete school certification.
4. After school certification is completed, the lender sends the Final Disclosure Statement to you.
5. The lender disburses the loan to Pitt-Johnstown after the Final Disclosure cancelation period has expired.