Alternative Loans

Applying for an Alternative Loan or Private Loan

Both Legacy Provision students and students who do not meet the Legacy Provision conditions may need to explore options for additional borrowing.

Students who wish to borrow funds through an alternative loan program are able to borrow up to the cost of attendance, less any other financial aid. While Suffolk University does not recommend a particular alternative loan program and will certify any loan for which a student meets the eligibility criteria, we encourage students to consider the information below to assist them in choosing the best program for their individual needs.

Once students have successfully exhausted all other funding options, such as federal loans, and are still in need of additional financing, they may want to consider a private student loan. Alternative loans are to be used as supplements to cover the remaining costs AFTER financial aid awards and federal loans.

Alternative student loans are granted based on creditworthiness and offered through private lenders or banks. These loans have certain eligibility criteria, primarily, a credit-worthy borrower with a verified income is necessary. However, some loans carry additional eligibility requirements, so be sure to check all requirements thoroughly with the selected lender before choosing a loan product.

The Office of Student Financial Services encourages first-time borrowers to begin the alternative loan pre-approval process early, as this allows time to resolve any credit issues and to secure a co-signer for the loan, if necessary.

Students should apply for a loan to cover their expenses for the entire academic year. For most students, this is the fall and spring semesters. Loan fees and interest rates vary by lender and are often based on a student's credit score. Interest begins to accrue upon disbursement of the loan; however, monthly loan payments may be deferred until after graduation for most lenders.

Important Things to Consider When Applying for an Alternative Educational Loan

1. Exhaust all other forms of aid prior to borrowing an alternative loan.

• Complete the FAFSA to be considered for federal aid, including Federal Direct loans.
• Take advantage of payment plans offered by the University. Suffolk offers a monthly payment plan which allows students to spread out costs for a small fee. Students who utilize the payment plan, even for a portion of their balance, often borrow less than those who do not and save hundreds of dollars in interest fees over time.

2. Determine the amount of the alternative loan.

• Plan for fall and spring semester costs.
• Borrow only the amount needed to cover educational related expenses.
• Keep in mind that students may be able to significantly reduce borrowing by covering yearly costs with a combination of sources: savings, present income, payment plans, and federal loans.
• If students need assistance with determining the amount to borrow, use the Additional Loan Calculation Form to help make these calculations.

3. When choosing a lender:

• Review contact information and details on many available alternative loan programs. Applications are submitted directly to the lender. We encourage students to compare all programs before selecting the best option for their needs. When doing research, be sure to visit the individual web sites for each loan program under consideration and keep in mind that a local bank or credit union may be another source to consider when choosing an alternative loan program.
• Understand fixed vs. variable interest rates: Fixed interest rates will not change during the entire life of the loan. Although they may be slightly higher than some variable rates now, they do not fluctuate with the market. Variable rates could rise significantly during the loan term, which could lead to higher monthly payments. Choosing a loan with a low variable rate over one with a fixed rate is best for a student who plans to pay off the principle of the loan in a short time.
• Take into consideration the total “price” of a loan: The interest rate is not the only factor for loan price comparison; look at the Annual Percentage Rate, as well as any fees associated with the loan. For example, a loan with a lower interest rate might seem more favorable, but high fees on the lower rate means it might be more expensive overall. Understanding these factors will provide students with a better understanding of the total loan costs.
• Review deferred payment vs. immediate repayment options: Some lenders require immediate repayment on their alternative loans. These monthly payments, however, can be as low as $25 a month and make a significant difference in the overall “price” of the loan. Even if the loan chosen offers deferred payments, making small payments while in school will help lower accrued interest and can make a dramatic difference in the length of time it takes to repay the loan.
• Use a Co-Borrower: A credit-worthy co-signer is often required for an application to be approved. In most cases, using a co- borrower results in lower interest rates and better loan terms. Even students with a credit history are encouraged to apply with a credit-worthy co-signer, since it could reduce interest rates significantly and save hundreds of dollars over the life of the loan.
• Understand loan eligibility requirements: Most lenders require a credit-worthy borrower with income verification for approval. However, some loan products have additional eligibility requirements that may include satisfactory academic progress, minimum enrollment status (at least half-time enrollment), and type of degree program. Before applying, make sure you meet all eligibility requirements.

While Suffolk University has compiled a list of alternative loan options, students are not required to select one of these lenders. Suffolk University will process any alternative loan application submitted by the borrower provided all eligibility requirements are met. Remember to compare all programs before selecting the best option.

New Requirements for Alternative Loans

As of February 14, 2010, federal regulations were implemented which require lenders to provide more in-depth information on alternative student loans, interest rates, and repayment options. As part of “the Higher Education Opportunity Act,” Title X is specifically aimed at private lenders and established new regulations that affect the way you receive, and are approved for, private student loans. Listed below are some of these new requirements:

Self-Certification Form
As part of the loan application process, student borrowers are now required to complete and return to their lender a self-certification form for each loan application submitted to the Office of Student Financial Services. An approved borrower must fill out a self-certification form (usually provided by the lender) and will be required to provide information on “cost of attendance” and “estimated financial aid.” Obtain a self-certification form. To avoid unnecessary delays, be sure to return this form to your lender and not to the Office of Student Financial Services.

Loan Approval Disclosure
Once your loan is approved, your lender will provide you with a statement that includes your interest rate, loan details, and repayment options. Student borrowers are now required to “actively accept” the terms of their loan within 30 calendar days before their school will be notified that school certification is available. The lender’s terms for how to “accept” the loan terms can be found in this disclosure statement.

Right to Cancel
Borrowers and/or cosigners have the right to cancel or rescind a loan offer within three business days after receipt of the Final Disclosure. During this time, the lender cannot disburse loan funds. Be aware the cancellation period cannot be waived for funds to be disbursed more quickly. This may delay the disbursement of loan funds to your student account, so be sure to take it into consideration when estimating the timeline for bill deadlines.

The Office of Student Financial Services will not certify a student’s alternative loan until all required lender documentation is complete. If you have questions regarding the status of your loan applications, please contact your lender.

Code of Conduct

Suffolk University is committed to the highest standards of professional conduct and ethical behavior. Ensuring the integrity of the student financial aid process and programs is critical to providing equity and access to higher education. With the Reauthorization of the Higher Education Act of 1965, Congress required that all colleges post a Code of Conduct relating to financial aid, private lending and student choice. Hence, the staff in the Office of Student Financial Services herein confirms that we adhere to the following sound practices:

I. University employees do not receive any personal benefits from Lending Institutions. No member of the Student Financial Services staff will accept anything of more than nominal value on his or her behalf of another person or entity from any Lending Institution. For example, cash, stocks, gifts, entertainment, expense-paid trips, etc., will never be accepted from a Lending Institution. Likewise, an individual will never accept payment or reimbursement from a Lending Institution for lodging, meals or travel to conferences or training seminars.

II. The University does not provide any advantage to a Lending Institution. The Staff in the Student Financial Services does not accept anything of value from any Lending Institution in exchange for any advantage or consideration provided to the Lending Institution related to its student loan activities, including, but not limited to revenue-sharing, printing costs or below-cost computer hardware or software. Likewise, the university does not allow any Lending Institution to staff the Student Financial Services Office or the Student Services calling center at any time.

III. The University makes appropriate use of any “Suggested Lender Lists”. The selection of the Lending Institutions for inclusion on the private/alternative loans Suggested Lender List is based solely on the best interests of the university students and their parents without regard to the financial interests of the university. We abide by the following:

1. Students and their parents are free to select the Lending Institution of their choice for private/alternative loans and will suffer no penalty imposed by the university from using a Lending Institution that is not a “Suggested Lender”.
2. Students and their parents are not required to use any of the university private/alternative loan “Suggested Lenders” and may borrow through any lender or guarantor they choose.
3. The university does not assign a borrower’s loan to a particular lender and will certify all loans based on a borrower’s selection of a lender.

IV. University employees do not serve on lender advisory boards for remuneration. No officer, trustee or employee of the university who makes financial aid decisions for the university or who is employed in, supervises or otherwise has responsibility or authority over the university Office of Student Financial Services will receive any remuneration for serving as a member or participant on a student loan advisory board of a Lending Institution, or receive any reimbursement of expenses for such service.

Bar Study Loans

Bar study loans are private educational loans which are available to assist law students and recent graduates with costs associated with taking the bar and living expenses during the study period leading up to the exam. Like private educational loans, bar study loans require a credit check. Bar study loans are not considered part of a student’s financial aid. Students should apply for the loan directly with the lender of their choice. The interest rate, fees, borrowing limits, and time frame in which students can borrow the funds varies by lender. Once approved, the loan funds are sent by the lender directly to the student. Students also select the date(s) they wish to receive the loan funds. Generally, students can apply for a bar study loan up to one year prior to graduation and no later than six months to twelve months after graduation, based on the lender. The maximum loan amount ranges from $12,000 - $15,000, based on the lender. To apply, contact your preferred lender directly to complete the loan application. Suffolk University Law School will process bar study loans through any lender and certifies only applications that have been approved for credit by the lender. Students should not bring paper certification requests to the office.

Students should compare bar study loan lenders to determine which lender best meets their needs. Suffolk University Law School has no financial interest in a student’s choice of lender. Students should be aware, however, that each time they apply for a loan with a lender, a credit check is performed. The interest rate and fees for bar study loans are often based on the student’s credit score.