Alternative/Private Education Loans
Loan Processing Timeline
Private education loan certification can take up to six weeks.
Fall 2026:
- Submit certification request by June 29 to meet July 29 fee payment deadline
- First possible disbursement date is September 3
Spring 2027
- Submit certification request by December 1 to meet January 7 fee payment deadline
- First possible disbursement date is February 4
Private Education Loans
Private education loans may help cover college costs that are not met by financial aid, personal resources, or other funding. Before applying for a private loan, complete the FAFSA or CADAA and review all federal, state, and institutional aid available to you. Federal Direct Loans and the California Dream Loan, if eligible, may offer lower interest rates and more borrower protections than private education loans.
Watch this short video to learn the difference between private and federal student loans.
Before You Borrow
Private education loans:
- Are offered by banks, credit unions, and other private lenders
- Are not part of the federal student aid program
- Usually require a credit check
- May require a creditworthy cosigner.
- Have interest rates, fees, repayment terms, and borrower benefits that vary by lender
- May have fewer repayment and forgiveness options than federal loans
Borrow only what you need. Review the total cost of the loan, not just the monthly payment or advertised interest rate.
Your private loan, combined with all other financial aid and educational resources, cannot exceed your Chico State cost of attendance.
Choosing a Private Loan Lender
Need help choosing a lender? Visit our Choosing a Private Loan Lender page to learn how to compare interest rates, fees, repayment options, cosigner requirements, and borrower benefits before applying.
More Information About Alternative/Private Loans
Private education loans are not part of the federal student aid program. Interest rates, fees, repayment terms, and borrower benefits vary by lender and are typically based on the borrower's credit history. Borrow only what you need. Your private loan, combined with other financial aid and educational resources, cannot exceed your cost of attendance.
We encourage students and families to use Federal Direct Loans and the California Dream Loan, if eligible, before considering a private education loan. Private education loans may have higher costs and fewer borrower protections than federal student loans. If you decide to pursue a private education loan, be sure to understand the terms and compare lenders carefully.
Understand Your Loan Options
Many families consider financing a portion of their student’s education with either a Federal Direct PLUS Loan or a private alternative loan. The comparison chart below will help you understand the features of each type of loan.
| Option | Federal Parent PLUS Loan | Private Student Loan | Private Parent Loan |
|---|---|---|---|
Primary Borrower | Parent | Student, often with cosigner | Parent or other eligible non-student borrower |
Loan Maximum | Up to $20,000/year ($65,000 lifetime) per dependent student* | Generally, up to school-certified cost of attendance minus other financial aid received. | Varies by lender; may be up to school-certified cost of attendance minus other aid. |
Interest Rate | 9.07% for 2026-27 aid year. The rate is fixed. New federal rates announced each July 1. | Fixed or variable; based on credit history | Fixed or variable; based on credit history |
Origination Fee | Federal loan fee applies; see current rate: Federal Student Aid | Varies by lender | Varies by lender |
Repayment Term | 10, 15, 20, or 25 years under the Tiered Standard Plan.** | Varies by lender | Varies by lender |
Payment Flexibility | Deferment and forbearance may be available.** | Repayment options vary by lender. | Repayment options vary by lender. |
Credit Check Required | Yes. Applicant must not have adverse credit history or qualify through an eligible endorser or appeal | Yes. Loan approval and pricing is generally based on creditworthiness. | Yes. Loan approval and pricing is generally based on creditworthiness. |
Minimum Enrollment Status | At least half time | Varies by lender, some offer loans for students enrolled less than half time. | Varies by lender, some offer loans for students enrolled less than half time. |
Options for Denied Loans | If a Parent PLUS Loan is denied, the dependent student may be eligible for additional Direct Unsubsidized Loan funds. | If student is denied, they may apply with a cosigner. | Varies by lender. Parent or other creditworthy individual may be able to obtain a cosigner. |
Application Process | Online with lender | Online with lender |
*Some Parent PLUS borrowers qualify for a federal limited exception that permits borrowing up to the cost of attendance minus other financial aid.
**For Parent PLUS loans taken out or consolidated after July 1, 2026, repayment is limited to the Tiered Standard Plan, and Public Service Loan Forgiveness is not available. Different options may apply to earlier loans.
Federal loan terms and eligibility are subject to federal law and may change. See StudentAid.gov(opens in new window) for current federal loan information.
Repayment
Here are some tips on repayment:
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