Private loans, also known as alternative loans, help bridge the gap between financial aid and the cost of attendance. These loans are offered by private banks and lending institutions and differ from federal student loans. The applicant must meet the lender's credit requirements, and the loan very often requires a co-signer. The interest rate, terms, and conditions vary among lenders.
If you do not have a Free Application for Federal Student Aid (FAFSA) on file, you do not need the FAFSA application to be considered for a nonfederal private alternative loan. However, you do need to complete the Private Student Loan Form to complete your paperwork.
Borrow What You Need
UNLV accepts and works with all nonfederal private alternative student loan providers. Students are encouraged to explore their options and find the loan that best meets their needs; however, nonfederal private alternative loans should be viewed as loans of last resort by students. Any borrower repayment benefits tend to be less flexible than federal subsidized, unsubsidized, or PLUS Loan type programs. Interest rates are also higher/more variable than lower/fixed-interest federal Subsidized, Unsubsidized, or PLUS loan type programs available. Borrow only what you need.
An example to determine how much a student can borrow in a nonfederal private alternative loan if necessary:
| Expense | Cost |
|---|---|
| Tuition & Fees | $5,300 |
| Books | $1,200 |
| Room & Board | $10,000 |
| Transportation | $600 |
| Personal/Miscellaneous | $2,800 |
| Total | $19,900 |
| Amount | COA |
|---|---|
| $19,900 | |
| - $3,500 | subsidized loan offered to student |
| - $2,000 | unsubsidized loan offered to student |
| - $1,000 | scholarship offered to student |
| = $13,400 | up to potential Private loan borrowing by the student |
Combining Loans
Non-federal private alternative loans may not be combined and consolidated with federal student loan programs at this time when a student enters repayment. The different program rules within private and federal loan programs prohibit such a maneuver. Many banks do offer consolidating alternative loans from Bank A with alternative loans from Bank B. You should check with your lender to determine if this is an option to lower your monthly payment when you enter repayment.