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Best Private Student Loans

Private student loans are a type of unsecured loans that are used to pay for part of, or all of your college education. These loans are offered through private lenders and are available to undergraduate, graduate, and professional-level students and those who attend vocational school.

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Find the top private student loan lenders that can help you refinance your existing student loans.

Private student loans: Getting started

Private student loans can be used to help pay for things like tuition, room and board, books, and school administration costs. The amount a person can borrow depends on factors like credit score, income, enrollment status, and the college program.

Most people take advantage of these loans since federal funding is sometimes not enough to cover the costs of their tuition, or the program they’re enrolled in is not eligible for federal loans.

Since they’re private, these alternative student loans come with some risks. For one, defaulting on payments will hurt your credit score. For another, these loans are usually ineligible for student loan forgiveness, deferment, or forbearance.

Private student loan types

  • Undergraduate student loans: These private loans for college typically have a maximum borrowing limit of between $80,000 and $120,000. These loans usually have fixed APR and a standard repayment period of 5 to 15 years. Along with graduate loans, these are the most common type of private student loans.
  • Graduate or professional school loans: Some lenders offer loans specifically designed for those attending a graduate or professional school program like law or business. Since these programs tend to cost more than undergraduate programs, these private loans often have higher loan limits. Borrowers usually start making payments while in school unless the program requires a residency. In either case, these loans will still gain interest as soon as the funds are disbursed.
  • Community college or technical training: There are alternative student loans available to borrowers attending community college, technical training school, vocational college, or other nontraditional schools. Federal loans usually cover the full cost of these programs, but private loans can cover any financial gap. These loans come with variable or fixed interest and different repayment plans.
  • Parent loans: Sometimes, a parent will take out a private loan on the student’s behalf. These loans are in the parent’s name, so they assume full responsibility for the loan and any interest. Unlike federal parent PLUS loans, most private loans don’t come with other fees beyond what’s written in the terms of the loan agreement. Depending on the parent’s credit score, they also often come with lower interest rates.

How do I choose the right private student loan?

The easiest way to start is by comparing different lenders. Every lender will have its loan terms, interest rates, fees, and eligibility requirements. Some only offer certain types of loans, such as undergraduate, graduate, or professional. Others may charge origination fees or prepayment penalties. Moreover, some lenders offer loans with fixed or variable interest, which can affect how much you pay over time.

Next, check to see if you qualify. Most private lenders require borrowers to have a 670+ FICO score and a verifiable source of income or a cosigner. Some lenders offer prequalification (a process that includes a soft credit check), so you can get an idea of what you qualify for without affecting your credit. The pre-qualification process may be helpful if you’re considering several different loan options.

Also, check to see if the lender offers any special or unique features. For example, some have loyalty discounts with consistent on-time payments or reduced APR with autopay. Others offer unemployment protection or flexible repayment plans to prevent borrowers from defaulting on the loan. A few private lenders even offer forbearance or deferment periods in case of financial, family, or health-related emergencies.

Before applying for any private loan, see what people say about the prospect lender on sites like the Better Business Bureau (BBB). This can give you an idea of how transparent or trustworthy the lender is.

Average student loans interest rates

Refinance student loans

Fixed 2.59% to 9.15%
Variable 1.88% to 8.9%


Fixed 3.34% to 14.99%
Variable 1.04% to 11.99%


Undergraduate 3.73%
Graduate 5.28%
PLUS 6.28%

Can I get a private student loan with bad credit?

Some private lenders offer loans specifically to those with bad credit. However, these loans typically come with higher interest rates and lower maximums.

Other lenders, who don’t offer bad-credit-specific loans, will require a 670+ credit score to qualify for a private student loan. One way to get around this is with a cosigner who will take responsibility for the loan if you are unable to make payments. The cosigner will need to have good credit and meet any other eligibility requirements.

Summing it up

A private student loan is one way for higher education students to fund their studies. Their repayment terms and rates may differ depending on the type and the student’s social-economic background.

Regardless of whether private or federal, any student loan is a commitment. Many students find it a smart idea to create a solid repayment plan before engaging in one. That way, you won’t risk damaging your credit score or falling into unwanted debt.


What are some risks associated with private student loans?

What should people look for in private student loan lenders?

What is the typical credit score needed to get a private student loan?

What’s the most you can borrow through a private student loan?