Puget Sound knows that choosing a private student loan can be confusing, so we’ve partnered with FASTChoice, an online tool that lets you compare different lenders. You can use any lender you like, even if they are not listed in FASTChoice, and we will still process your loan.

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General Information About Private Loans

Private educational loans are credit-based, not need-based. Interest rates are typically variable, and interest accrues while the student is in school. Generally, repayment of the loan can be deferred until the student graduates, leaves school or drops below half-time enrollment. Students may borrow up to the cost of attendance minus other financial aid each academic year. Most private loans require students to be degree-seeking and enrolled at least half-time (2 units for undergraduates, 1.5 for graduates). Some lenders offer continuing education loans for less-than-half-time or non-degree enrollment, and many require students to meet Satisfactory Academic Progress. Academic requirements vary by lender.

To ensure funds are available when needed:

  • Students who need help determining how much they can borrow (cost of attendance minus other aid) should contact Student Financial Services at SFS@pugetsound.edu.
  • Loans are typically certified and evenly disbursed across the terms listed on the application unless students request a different distribution due to uneven costs.
  • Federal regulations require a loan self-certification, which adds processing time. This is a reminder that the fall semester payment confirmation deadline is August 15th. The spring semester payment confirmation deadline is January 15th. Students are strongly encouraged to apply early enough to meet these payment deadlines and avoid any late fees.
  • Loan funds may take up to four weeks after approval to disburse. Students needing a loan for the full year should apply for the entire year rather than term by term.

In some cases, a private lender will allow you to borrow a loan to pay a past due balance. Once approved, if you are borrowing to cover a past due balance, please contact Student Financial Services at SFS@pugetsound.edu to let us know how much and what term you are using the loan to repay.

Each year, Puget Sound reviews private lenders to decide which ones to include on our list. We look at things like interest rates, how well lenders protect your personal information, any borrower benefits they offer, and most importantly how they comply with regulations stated in the Higher Education Opportunity Act of 2008.

Private loans are different from federal loans. Interest rates, fees, and repayment options are set by each lender, so they can vary a lot. Private loans are based on your credit history, so it helps to check your credit report and apply with a credit-worthy co-signer. You can get a free credit report at annualcreditreport.com.

Puget Sound does not benefit in any way from your choice of lender. We are a member of the National Association of Student Financial Aid Administrators (NASFAA), and as such, conform and adhere to the NASFAA Statement of Ethical Principals and the Code of Conduct for Institutional Financial Aid Professionals, and Puget Sound’s own institutional Code of Conduct.

Private Loan FAQ

Private loan interest rates vary by lender and are based on factors like credit history and market conditions. Lenders may offer fixed rates (stay the same for the life of the loan) or variable rates (can change over time). Some lenders place a cap on variable rates, while others do not, so it's important to review each lender’s terms carefully.

It is best to apply for a private education loan about two months before your tuition is due to allow for processing time. Most lenders consider a credit check (hard inquiry) valid for a period, typically between 30 and 90 days, for a specific application or related applications within that timeframe.

With that in mind, the payment confirmation deadline for the fall semester each year is August 15. The payment confirmation deadline for the spring semester each year is January 15.

Fees vary by lender. Some private loans include origination or application fees, while others have no fees at all. If a lender charges fees, they are usually taken out of the loan amount at the time the loan is disbursed, meaning you receive slightly less than you borrow. Always review the lender’s terms to understand any fees before accepting a loan.

The Student Financial Services office confirms your enrollment and cost of attendance with the lender. The lender sends funds electronically directly to the school on the scheduled disbursement date(s), typically at the start of each semester. The school applies the funds to your tuition, fees and other billed costs such as food and housing. Any excess balance (if applicable) is then refunded directly to you for other education expenses.

Repayment on private education loans begins based on the option you choose: immediate, interest-only while in school, or deferred (no payments while enrolled).

Most lenders offer a grace period, typically six months after you leave school. However, a grace period is not guaranteed and interest usually accrues during this time. You must check your specific loan terms.

Your monthly payment on a private education loan depends entirely on the loan amount, your interest rate, and the chosen repayment term. 

Higher monthly payments are tied to larger loan amounts, higher interest rates, and shorter repayment terms.
Lower monthly payments result from smaller loan amounts, lower interest rates, and longer repayment terms (which increase total interest paid).

Use online calculators like the Finaid.org Loan Payment Calculator to estimate your specific payment.

No, there are generally no penalties for early repayment on a private education loan. Due to federal law and industry standards, most reputable lenders are prohibited from or simply do not charge fees for paying off your loan early. You can make extra payments or pay off your entire balance at any time to save on interest costs; always review your loan agreement to confirm this detail.

Most private lenders offer some form of deferment or forbearance, but the options vary widely. Some may allow temporary payment pauses during school or financial hardship, while others offer limited or no flexibility. Be sure to review each lender’s specific policies and eligibility requirements before borrowing.

To determine if a private education loan program is well-established, look for transparency, a strong track record, positive independent reviews, and comprehensive customer support. Well-established lenders prioritize borrower education and offer clear, competitive terms.