Attending a private college after high school can cost approximately four times more than it costs to enroll at a public four-year institution. Students, however, increasingly opt for a private education as professional careers become more competitive. Paying for private school is by no means easy, but it is quite possible.
Private school loans can be obtained from both the U.S. Department of Education and a private lender. The government backs both subsidized and unsubsidized loans for students. If you are able to show financial need, you may qualify for a subsidized loan – that is a loan where interest is not charged during deferments and grace periods. Government loans are ideal because they feature low interest rates and are virtually hassle-free. The problem with government loans is they barely pay out enough for students attending public institutions to keep their bills paid. A lot of times, a government loan isn’t enough to address a student’s living expenses.
Enter the private lender. Private school loans can also be taken out through a private agency. Private loans are a little trickier than the government student loan. Lenders don’t care about a person’s “financial need” but credit history and ability to repay are very important. Therefore, in order to be considered for a private loan, the potential borrower must have a solid credit history or a co-signer who does. Private lenders also offer different loan packages and interest rates. Borrowers looking at private student loans through an agency outside the Department of Education should gather information on numerous lenders and compare them to find the best deal.
One way or another, paying for a private college education is doable, it can just take a little more work on the financial end of things. Ideally, students will exhaust their federal loan and grant options before turning to a private lender for financial assistance.