GradPLUS Loan vs. Private Loan

Last semester the Department of Education created a new loan program exclusively for Graduate students called the GradPLUS loan. Now students have options when it comes to bridging the gap between their financial aid package and the cost of attendance. Before students could only turn to Private loans to finance their graduate studies but finally the Department of Ed recognized the need for different sources of financing.

This raises many questions for grad students because they are not certain what loan is the best loan for them. Basically, if you are looking for a fixed interest rate loan, that has opportunities to defer or forbear your loan payments and your credit is good, fair or poor then you should apply for the GradPLUS loan. However the catch with the GradPLUS is that you MUST fill out a FAFSA! There is no escaping this lengthy paperwork if you want to receive the GradPlus loan.

Now, if you do not want to file the FAFSA then Private loan is the loan for you. To recieve a Private loan all you need to worry about is filing a short application and submitting proof of enrollment with the application. Proof can be a class schedule or a tuition bill. Also what is really nice about the Private loan is that the money is sent directly to the borrower. Unlike that GradPLUS loan this loan does not need to get certified by the school’s financial aid office. The application is quick, simple and the borrower is in complete control on how they receive the money.

After reading this if you happen to think of any other differences between GradPLUS and Private loans feel free to comment!





The Student Loan Network: Stafford Federal Student Loans, Parent PLUS Loans, Student Loan Consolidation, Private Student Loans, Education Loans/College Loans

This entry was posted on February 15, 2007 at 3:57 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.