The Pluses and Minuses of Alternative Student Loans

Alternative student loan is another term for a private student loans. It can refer to private student loans in general, or it can refer to specialized loan products for students whose educational programs do not meet the criteria for traditional loans.

Students should consider going this route if all their federal aid and aid from their college does not quite cover their expected costs. They will also need alternative funding if their program does not qualify for government funding.

Before turning to private lender, carefully consider the following:

  • Have you explored all the federal, state and college sources of loans, grants and scholarships?
  • Have you applied for all the grants and scholarships for which  you might be qualified?
  • Do you have any college savings?
  • Will you have any income while you are studying?
  • Have you really calculated the difference between the money you have for school and the real cost of your education?

Alternative loans are the most expensive way to finance an education, but if you need one and you go into it with your eyes open, a private student loans can be a useful tool.

Find The Right Alternative Loan For You

It is critical to find the right alternative loan for you. There are many, many lender to choose from, and each offers an array of products. Loan limits, interests rate and repayment terms can vary widely. Do your research, and do  not jump into a decision. Use one of the calculators on ( to figure what each loan is really going to cost. Once you really understand your options, you will be able to make an informed decision that will benefit you as you work towards your goals.

To qualify for government student loans, a student must be enrolled in a two – or four-year degree program, and must be enrolled at least half-time. If you do not meet these conditions you will have to turn to alternative private loan sources. Sallie Mae has developed several product designed for this market. They include the Continuing Education Loan and the Career Training Loan.  You can find details at