Alternative and private loans
Alternative and private loans are credit-based loans offered by some banks and credit unions to students to help cover allowable educational expenses not covered by financial aid. These loans are not part of the federal loan program and not guaranteed by the federal government.
Typically, alternative and private loans:
- Require a credit worthy co-signer, with U.S. citizenship or permanent resident status.
- Can have fixed or variable interest rates.
- Have an interest rate based on a financial benchmark such as Prime or LIBOR plus a margin that is usually based on the creditworthiness of the borrower and co-signer.
- Accrue interest while a student is in school.
- May require repayment while you are still in school.
Prior to borrowing alternative and private loans, you should:
- Apply for and be sure all federal, state and institutional funds have been utilized.
- Compare federal and alternative/private loans at the Federal Student Aid website.
- Know the amount that you really need to borrow and don't borrow more than you need. Contact the Financial Assistance Office if you are unsure of the amount you need to borrow.
Because of the more favorable interest rates and repayment terms of the federal student loans, private loans should be considered after federal loans have been used, and the PLUS loan for parents has been considered.
While federal student loans should be a first choice, we understand that some students will choose to borrow from private lenders. Augustana College does not have a preferred lender list or any type of preferred lender arrangement. We have compiled a list of lenders that our students have used over the past three years. Augustana does not promote, recommend or endorse any lender on the linked list below. Augustana College will process private/alternative loans through any lender of your choice; you are not limited to the lenders on this list.
Here is a list of lenders used by Augustana students over the past three years
If you are considering borrowing an alternative/private loan, we recommend applying by July 15 for ample processing time.
Private Education Loan Applicant Self-Certification Form
Students applying for alternative and private loans must complete and submit to their lender a Private Education Loan Self-Certification Form prior to the processing of the loan by the lender. Call the Office of Financial Assistance if you need additional help completing the form.
Code of Conduct for education Loans
The Higher Education Opportunity Act of 2008 (HEOA) requires institutions of higher education to establish and follow a Code of Conduct with respect to student loans that prohibits conflicts of interest for any financial aid professional [HEOA § 487(a)(25)]. In accordance with this requirement, each staff member of the Office of Financial Aid at Augustana College signs the following conflict of interest policy and code of conduct on an annual basis.
Augustana College Code of Conduct for Education Loans