Private loans for students?

[annasdad]

<p>We received a press release yesterday that raised my eyebrows, given the conventional wisdom here on CC about the impossibility of students getting non-Stafford loans on their own account. Here is an extract from the press release, with the name of the company and the name of the product redacted because I’m not interested in promoting either, and with emphasis added:</p>

<p>

[company] today announced that its [trade name] Student Loan® product is now available with a new fixed rate, giving students peace of mind in knowing how much their monthly payments will be when they start to repay their loan. There are no origination fees associated with the loan and interest rates are as low as 6.75 percent APR. Although students have the ability to qualify solely, they are encouraged to apply with a qualified cosigner to increase their chances of receiving the lowest interest rate possible.
…
With all fixed- or variable-rate [trade name] Student Loans, students have three repayment choices: immediate, interest only or deferred until six months after graduation.
…
[company] certifies loan amounts with colleges to help ensure that students only borrow what they need to fund their education, including indirect costs such as books and personal expenses.
…
The [trade name] Student Loan is available to eligible students who are enrolled at least half-time in a four-year undergraduate or graduate program. Students can apply online at …

</p>

<p>Comments anyone?</p>

[annasdad]

<p>Digging deeper, into the referenced website:</p>

<p>

Borrowing Limits: The ability to finance up to the total cost of education minus financial aid received

</p>

<p>the above has this footnote:</p>

<p>

As determined by your school. Minimum borrowing amount is $1,000. The [trade name] Student Loan does have lifetime aggregate limits (including both federal and private loan debt) of: Undergraduate: $120,000; Graduate: $150,000; Business and Law: $175,000; and Medical: $225,000.

</p>

<p>

Loan approval is based on credit. If students do not have sufficient credit to be approved on their own, they are encouraged to apply with a qualified cosigner. Cosigner release option is available after 36 consecutive, on-time payments.

</p>

<p>which appears to shade, at least in part, the come-on lingo in the press release</p>

[cptofthehouse]

<p>My son has his bank accounts with Wells Fargo and has done an excellent job in his finances. He gets a similar offer for borrowing each year. It seems that the max that he could borrow is $25K on his own, though it is not completely clear. It stipulates that he MAY need a co signer and that even if he qualifies for any amount without a co signer, his interest rate would probably be lower with a co signer with a strong credit history. Who knows if he would even get a dime in proceeds without a co signer and what the interest rate would be even with?</p>