Some students may not be financially or academically eligible to receive the benefit of federal, state or institutional grants and loans, or may have educational expenses that exceed available sources of financial aid. A private or alternative education loan may be an option for students in these situations to consider for college funding. These loans should only be pursued after all other financial aid resources have been exhausted. We recommend that students check with the financial aid office to confirm they have received all available federal, state and institutional funds before pursuing private educational loans.
JCC cautions all students to be conservative in their borrowing and to thoroughly research and learn the borrower’s rights and responsibilities prior to applying for any loan. Private loans are issued through different lenders and may have varying interest rates and fees. Eligibility is generally based on income and credit history and most students are required to have a cosigner. These loans generally charge fees and interest rates that are higher than those available through the Federal Direct Student Loan Programs and should be considered only as a last alternative, after all federal and state aid options have been considered. For more information on the differences between the Federal Student Loan programs and private education loans, you can visit the Department of Education’s Federal Aid First web site.
The “FinAid: The SmartStudent Guide to Financial Aid” web site has a private education loan section that provides helpful information about loan comparison services and charts that may be useful if you are considering a private education loan. This link is provided as courtesy. Jamestown Community College does not endorse nor recommend any private, or alternative, loan providers or products.
The College does, upon student request, certify student eligibility for private alternative loans. Since these loans may be issued by various lending institutions, the College abides by the Code of Conduct for Processing Student Loans to ensure that its employees avoid conflicts of interest, or the perception thereof, in connection with their responsibilities relating to providing and administering student loans.
Before committing to a private loan, ask these questions:
- What is the interest rate, is it fixed or variable, and is there an interest-rate cap?
- What are the borrowing limits?
- How long is the grace period? What are the deferment options both during and after school?
- What are the additional fees?
- Does the loan offer penalty-free pre-payments?
A lender must obtain a self-certification form signed by the applicant before disbursing a private education loan. The school is required to provide this form or the required information for students admitted or enrolled at the school. Most lenders provide this form to their loan applicants; it is also available here.