For many students, the best student loans are those available through federal student loan programs. Federal student loans don't require a higher income or a good credit score (for undergraduates, there's no credit assessment at all), and all borrowers get the same fixed rates of interest. Federal loans are also eligible for deferment, forbearance and forgiveness programs.
Experian data shows the typical student loan balance in 2023 was $38,792. However, there's a limit to how much you can borrow from federal student loans. In 2023, dependent undergraduate students can only borrow up to $31,000 in federal loans, and independent undergraduate students are allowed to take on up to $57,500 in federal loans.
Private student loans can be helpful if you need additional funds outside your federal loan limit, don't qualify for federal student education loans or qualify for a lower rate of interest from the private lender. A few of the top private education loan options also come with benefits that you will never find on federal student loans, for example no origination fees. Here's an overview of a few of the top private education loan options.
Best Private Student Loans
We're centered on undergraduate student loans here, quite a few these lenders offer graduate student education loans, and a few have home loan programs for bootcamps as well.
Ascent
Ascent sticks out with its three loan options for undergraduates. You are able to apply with a cosigner for any credit-based loan, or without a cosigner if you have established your credit and have an income. There's also a non-cosigned, outcomes-based loan for juniors and seniors who be prepared to graduate within the next nine months.
- Repayment terms: Five, seven, 10, 12 or Fifteen years
- Five repayment plans: Payment deferral for approximately nine months after leaving school, interest-only payments during school, $25 monthly payments, progressive payments that start small and get bigger, and full payments
- Interest rates: Fixed or variable
- Loan amount: $2,001 as much as your cost of attendance
- Fees: No origination, disbursement or prepayment fees
- Cosigner release option: Yes
- Soft inquiry prequalification: Yes
| Pros | Cons |
|---|---|
| Choose the loan term and repayment schedule | Freshman and sophomore undergraduates may require a cosigner |
| Non-credit-based loans available | Outcome-based loans might have higher interest rates |
| Potentially earn 1% cash back after graduation | Aggregate loan cap ($200,000) isn't based on price of attendance |
Earnest
Earnest stands out because its private student loans' interest rate ranges start less than many other lenders. Your rates while offering is determined by your creditworthiness and whether you've got a creditworthy cosigner. You should check your offers without impacting your credit.
- Repayment terms: Five, seven, 10, 12 or Two decades having a cosigner. With no cosigner, loans are available with 10-, 12- or 15-year terms.
- Four repayment plans: Payment deferral for approximately nine months after leaving school, $25 monthly obligations while in school and through deferral, interest-only payments while in school and during deferral (for cosigned loans) and full payments (for cosigned loans)
- Interest rates: Fixed or variable
- Loan amount: $1,000 up to your cost of attendance
- Fees: No origination, disbursement or prepayment fee
- Cosigner release option: No
- Soft inquiry prequalification: Yes
| Pros | Cons |
|---|---|
| Choose the loan term and repayment schedule | Repayment term might be limited without a cosigner |
| Low advertised rates of interest | Deferring and skipping payments can increase total costs |
| Can skip a payment every 12 months |
MPOWER Financing
MPOWER Financing concentrates on offering private student loans to international students and students with Deferred Action for Childhood Arrivals (DACA) status. While there aren't as many loan choices to select from, it's not easy to qualify for any student loans if you aren't a U.S. citizen and do not have a cosigner who's a U.S. citizen or permanent resident.
- Repayment term: Ten years
- One repayment schedule: Interest-only payments with deferred full payments for up to six months after leaving school
- Interest rates: Fixed
- Loan amount: $2,001 to $50,000
- Fees: 5% origination fee, no prepayment fee
- Cosigner release option: Not applicable; MPOWER doesn't accept cosigners
- Soft inquiry prequalification: No
| Pros | Cons |
|---|---|
| Accepts international and DACA students with no cosigner | Only available if you attend one of many hundred schools in the U.S. and Canada |
| No credit history or cosigner required | Only one repayment term and plans |
| Three rate of interest discounts can lower your rate by a total of 1.5% | Has an origination fee |
SoFi
SoFi provides a number of loans and banking products, also it gives customers use of various kinds of benefits and rewards. For example, there's free career coaching for current members. And the unemployment protection plan can provide you with as much as 12 months of loan forbearance if you involuntarily lose your work.
- Repayment terms: Five, seven, 10, 15, and Two decades
- Four repayment plans: Payment deferral for approximately 6 months after leaving school, interest-only payments during school, $25 monthly obligations and full payments
- Interest rates: Fixed or variable
- Loan amount: $5,000 to your cost of attendance
- Fees: No origination, disbursement or prepayment fees
- Cosigner release option: Yes
- Soft inquiry prequalification: Yes
| Pros | Cons |
|---|---|
| Choose your repayment term and plan | High minimum amount borrowed |
| Multiple benefits for borrowers | Applicants may need a cosigner |
| No fee to apply or obtain a loan | Fewer rate of interest discounts than some lenders |
FAQs
Choosing a student loan lender could be a daunting process. Review the questions below that will help you focus on which is right for you.
How Would you Select a Education loan Provider?
Some lenders stand out due to their potential loan offers, discounts, benefits or eligibility criteria. However, the loan offers you receive might not match all of the advertised options, as the loan amounts, repayment terms and interest rates can depend in your creditworthiness. You might want to apply for student loans from multiple lenders to determine what offers you the very best rates and terms.
How Are you eligible for a Private Education loan?
The qualification requirements for any private student loan is determined by the lending company and also the type of mortgage. Lenders may have minimum credit rating requirements, only offer loans to residents of certain states or require students to become enrolled a minimum of half-time in an eligible school. For undergraduate private student loans, the students often don't have a long credit rating or good credit score, which is why many applicants require a creditworthy cosigner (such as a parent) to obtain a loan.
How Can You Apply for a Private Student Loan?
You can apply for a private student loan by comparing lenders and submitting a prequalification or application. Many lenders have online applications and allow you to check your eligibility and potential offers with a soft credit check—the type that does not hurt your credit ratings. But you might need to accept a hard credit assessment to complete the applying.
Check Your Credit Before Applying
If you are trying to get a student loan or considering cosigning someone else's loan, check your credit score first to determine where you stand. Experian provides you with a FICO® Score☉ for free based on your Experian credit history. You'll also get insights into what's hurting and helping your score, which you may be able to use to improve your score.
All specifics of Ascent, College Ave, Earnest and MPOWER Financing student loans have been gathered independently by Experian and has not been provided or reviewed by the issuer. Offer details might be outdated. See issuer website for current details.