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If the federal and state educational loans you and your student receive aren’t sufficient to meet college costs, you or your student may be interested in checking out an alternative, or private, loan. Some banks and lending institutions offer these loans to students with no fees, low interest rates and flexible repayment options, with no payments due while in school. Others, however, charge origination fees and may require payment of interest while your student is in school. Each lender’s policy is different. Check out a few options with your student before making a decision.
Your child should not apply for an alternative loan until after financial aid has been awarded. Have your child consult the financial aid office at the college before selecting an alternative loan. The financial aid office may be able to suggest lenders which offer alternative loan programs that better suit your student's financial needs. If you or your child do apply for an alternative loan, be aware that some lenders may perform credit checks; determine income-to-debt ratios; and, if the loan is in your student’s name, may require you to serve as a co-signer.
College Illinois! Capstone Loan Program (Pilot)
Beginning with the 2007-08 academic year, college seniors who are enrolled at institutions participating in the College Illinois! Capstone Loan pilot program may be eligible for this alternative loan to help them complete the final semester(s) prior to graduation. Specific details can be found at the College Illinois! Capstone Loan Program (Pilot) page.
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