Alternative Loan Options

Private Loans

What is a private student loan?

Private student loans are obtained through lending institutions and are not part of the federal student loan programs.  In most cases, federal student loan terms and conditions are more favorable than terms and conditions for private loans.  Care should be taken when choosing to use private loans to assist in paying for higher education.  It is important to remember that student loans of any kind must ultimately be repaid.

Students may seek a private loan to cover expenses not covered by their federal student loan eligibility but they cannot receive more than their cost of attendance minus any other assistance they are receiving to help with college related costs. Application for private loans is initiated by the student through a lending institution of their choice.

What is the difference between federal and private loans?

Federal loans are made by the government and the terms and conditions are set by law. Private loans are made by organizations such as banks and credit unions. The lender sets the terms and conditions for private loans. A chart showing the primary differences can be found at https://studentaid.ed.gov/sa/types/loans/federal-vs-private.

How do I find a lender?

Montana Tech partners with Great Lakes Higher Education Corporation to provide you with FASTChoice. FASTChoice is a tool which will help you compare the loan products that our students have used historically.

*Please note that students have the right to choose any lender that offers a private student loan. It does not have to be a lender listed in FASTChoice or one that has been used historically at our school.

What is the process to apply for a private loan?

Montana Tech recommends that you first exhaust all Federal Subsidized and Unsubsidized loan options at your disposal before choosing private loans as an option. Once you have decided that private loans are necessary, you should then research the loan terms offered by lending institutions to determine if you are comfortable with them.  Once you have chosen a lender, the steps to apply are:

1. Complete the loan application located on the lender's website.  Unless you have excellent personal credit, will most likely need a credit-worthy co-signer (parent, spouse, grandparent, other close relative) to sponsor your loan application. Co-signers are responsible for repaying the loan should the student fail to make timely payments.
2. Application passes through credit analysis.
3. Application is sent to the school for certification.
4. Montana Tech will certify that the loan amount requested is within Federal guidelines.
5. Student self-certifies the loan using the Private Education Loan Self Certification form.
6. Once the self-certification form is received by the lender from the student, the lender must wait the mandatory number of days before they release the funds to the school to give the borrower time to decide if they want to cancel the loan.
7. Funds arrive at Montana Tech and are posted to your Business Office account. If the funds create a credit balance, a check made payable to you will be distributed by the Business Office.