Millions of Americans would not be able to attend college without student loans. As the cost of education
continues to rise faster than inflation and funds such as grants and scholarships seem to be harder to obtain,
private loans have become more widely accepted as an alternative education funding option.
Private loans are credit based alternative loans for students who require educational funding in excess of the
amount allowed under federal loan programs. These programs are not guaranteed by the federal government and the
federal government does not subsidize the interest rates. Therefore, we encourage students to maximize their
funding under the federal loan programs before seeking a private loan.
Eligibility and the amount that can be received through private loans may be affected by U.S. citizenship, school
enrollment, field of study, credit history and federal assistance.
Eligibility requirements for private loans may vary by the products offered at your school. Most private loan
programs require the student to meet the following minimum standards:
- Enrolled at least half-time in a graduate or undergraduate degree or certificate program at an approved
and accredited university or college
- University or college must certify that you are enrolled and making satisfactory academic progress
- Be of legal age as required by your state of residence
- Be a U.S. citizen or permanent resident (International students may apply with a creditworthy U.S. or
permanent resident cosigner). The school you are attending may have private loan programs specifically
designed for international students that cannot obtain a U.S. cosigner.
Additionally, the student borrower and cosigner must meet minimum credit requirements. These credit requirements
may differ depending on the private loan products that are available to you. Credit requirements may consist of
the following:
- Satisfactory credit history
- Minimum credit score
- No derogatory credit such as student loan default, bankruptcy, excessive delinquencies or write-offs of other
personal debt obligations
- Minimum number of credit trades and sufficient credit history
A credit score is a quick and consistent method lenders use to determine the likelihood that a loan applicant will
repay their loan based on your past credit history. FICO score is the most commonly used scoring model. FICO stands
for Fair Isaac Company, the company that created the original scoring model. The formula used by Fair Isaac utilizes
everything from numerous addresses, alias names, occupation, length of time you have had credit and other factors to
come up with your score. Several of the following factors can negatively affect your credit score:
- excessive delinquencies, derogatory public records, accounts in collection
- the proportion of balances to credit limits is too high
- the proportion of loan balances to loan amounts is too high
- too many new accounts
- too many accounts with balances
- insufficient time since account was established
- too many credit inquiries in the past 12 months
- too many finance accounts
Applying for a private loan is easy! First, you will need to have the following information available to apply
online or to apply over the phone.
- Name, Social Security Number and address (For United States military personnel stationed overseas, please use
your permanent domestic address. For United States citizens living abroad, please use a domestic address)
- School you are attending
- Field of study
- Requested loan amount and date needed
- Monthly income, employment information, and monthly housing mortgage or rent payment
- Name, address and phone number of your personal reference
- And, if applying with a cosigner, your cosigners e-mail address and phone number (using a cosigner can
substantially increase your chances of being approved for a loan)
Once you have this information available you are ready to apply. You can apply online or by contacting a Nelnet College
Planning Advisor at 1.866.866.7372.
The online process includes seven simple steps.
- You will be prompted to choose the school you will be attending, your field of study and grade level. Once
completed, information related to the loan programs that are available at your school will appear on the screen
- You will be asked to create a Nelnet account and login ID
- You will be ask to consent to having your credit pulled and automatically reviewed for pre-qualification
- You will be asked several questions related to your monthly income, employment history, monthly housing costs,
requested loan amount and loan period (If you are requesting a loan in a future period, the loan period must begin
less than 60 days in the future. If the loan is for a past period, the loan period must have ended less than 12 months
in the past)
- Your pre-qualification information will appear on the screen. You may add a cosigner at this time. Even if you are
already pre-approved, adding a cosigner may lower your loan’s interest rate and total finance charges.
- If approved, you will be given the option to electronically sign your private loan application
- For the final step, you will complete the references section, verify the accuracy of the application data, review your
rights and responsibilities, submit a promise to pay, and electronically sign/print the application.
For personal assistance with completing your private loan application, please contact a Nelnet College Planning Advisor
at 1.866.866.7372.