Federal Graduate PLUS Loan

Private Educational Loans

Interest Rate

Fixed interest rate of 8.5%, however, lenders may offer repayment incentives to reduce the rate in repayment.

Most private loans have a variable interest rate, determined by the lender. The rate may be based on credit worthiness of borrower and/or co-borrower. Current rates can range from 6.8% to 15% or higher. The NJCLASS Loan has a fixed interest rate for graduate students. For 2007-08, this rate was 6.35%.

Interest Accrual

Accrued interest is capitalized at repayment. Interest begins to accrue once the loan is disbursed.

Accrued interest may be capitalized as often as monthly, based on the lender. Interest begins to accrue once the loan is disbursed.

Fees

Loan fees of up to 4% may be deducted from the loan amount based on the lender and guarantor.

Vary by lender. Current fees range from 0% to 10% or higher. Fees may be based on credit-worthiness of borrower and/or co-borrower.

Borrower

The student is the borrower. Students who do not pass the credit check can apply with an endorser.

The student is the borrower; however, based on the student's credit, a credit-worthy co-borrower may be required by the lender.

Eligibility

Must be enrolled at least half-time and meet requirements to receive federal aid.

Determined by lender. Loans are available for students who do not meet requirements for federal aid.

Loan Limits

Up to the Cost of Attendance less any other financial aid. No aggregate limit.

Up to the cost of attendance less any other financial aid. Limits also depend on annual and aggregate maximums established by the lender. Borrower's credit may also affect the maximum amount the lender will approve.

Credit Requirements

Basic credit check performed; however, no credit score or debt-to-income ratio is used. Federal regulations state that the borrower must not have adverse credit. *

Most lenders perform a credit check using your credit score. Debt-to-income ratio may also be considered.

Repayment

Repayment begins after the last disbursement, however, students enrolled at least half-time are eligible for in-school deferment. Standard repayment term is 10 years; however, can be extended up to 25 years based on amount borrowed.

Varies by lender, but generally no payments are required while student is enrolled. Repayment term can range from 10-25 years based on lender and amount borrowed.

Grace Period

None; however, deferment and forbearance can be requested.

Varies by lender. Ranges from 0 to 9 months.

Deferment Options

Yes, federal loan deferments apply.

None.

Forbearance Options

Yes, federal loan deferments apply.

Varies by lender. Many lenders offer limited forbearance options.

Loan Consolidation

Eligible for federal loan consolidation. Interest rate for federal consolidation loans is based on the weighted average of the loans being consolidated, not to exceed 8.25%. No consolidation fees apply.

Some lenders offer private loan consolidation, but the interest rates are variable and based on credit. Fees can apply to private consolidation loans.

Death/Disability

Can be discharged upon death or total and permanent disability of the borrower.

Private loans do not have a discharge for death or disability.