Each lender sets its own minimum and maximum borrowing amounts. However, just because you can borrow up to your remaining cost of attendance doesn’t mean you should.
Your loan balance, interest rate and loan term (definitions below) can dramatically impact the overall costs of a private student loan.
When you take out a student loan, your balance is the amount you borrowed. As interest accumulates, your loan balance grows. You might have several student loan balances, depending on how many loans you took out.
When you borrow a student loan, you agree to pay back your borrowed amount, plus interest. With the exception of federal subsidized loans, interest starts racking up from day one.
Private student loans can come with fixed or variable interest rates. Variable rates often start lower than fixed ones, but they can drastically increase over time.
The term is the number of years it takes to repay your loan. Private loans are not eligible for federal repayment plans. Most private lenders let you choose a term of five to 20 years, though some have longer or shorter terms available.
Use the following questions to determine how much private funds you should borrow: