Private/Alternative Student Loans

Private student loans (also interchangeably called education or alternative student loans) are designed to bridge the gap between college costs and traditional financial aid resources. They may be used to help pay for current term expenses, past due balances from a previous term or academic year, and can also be used for students who are enrolled less than half time.

Private student loans cannot exceed the Cost of Attendance minus other financial aid the student is receiving. They are offered and serviced by private loan lenders.

California Lutheran University will only certify private student loans for students who are meeting Satisfactory Academic Progress (SAP).

Compare Your Options

Should you borrow a Federal Loan or a Private Student Loan?

If you are trying to decide between borrowing a federal student loan or a private student loan, be sure to compare the pros and cons of each before making your decision.

If you completed the FAFSA, you may qualify for federal loans or other assistance under the Title IV program. The terms and conditions of federal loans under the Title IV program may be more favorable than those of private student loans. Generally, students should exhaust their federal loan eligibility before opting for an private student loan.

Review this helpful comparison diagram provided by Federal Student Aid to determine what type of loan may best suit you.

Procedure

You must complete the 3 steps below in order to receive a private student loan.

STEP 1 - Select a loan lender

Eligibility for a private student loan is based on the student's and co-signer's (if required) credit history. Most loan lenders allow students to determine if they would like to have a fixed or variable interest rate and when their repayment will begin.

Lender Search Tool

Cal Lutheran is an impartial party and cannot recommend any particular lender. However, through careful consideration of many factors, including borrower benefits, Cal Lutheran provides a Lender Search Tool containing a list of lenders that are currently participating in private student loan lending. Students are in no way restricted to this list of lenders when borrowing a private student loan. Lenders within the tool are displayed in random order.

Lender Search Tool

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STEP 2 - Apply for a loan from your chosen loan lender

Once you have determined which lender you want to borrow a private student loan from, the next step is to complete a loan application with that lender.

Most private student loan lenders have an online application you may use to apply.

If you are already approved for the loan by your lender, move on to step 3

If Needed: What to do if your lender requests a self-certification form

Most lenders include the certification form as part of their online loan application process which means you do not need to complete the self-certification form yourself.

The instructions below are only necessary if your lender requests for you to complete a seperate self-certification form.

If prompted by your lender, download the Alternative Loan Self-Certification Form.

Self-Certification Form Information

The Title X of the Higher Education Opportunity Act (HEOA) requires that a series of three loan disclosures be provided to Alternative Loan borrowers throughout the application process and that the borrower also complete an Alternative Loan Self-Certification Form prior to the loan being disbursed.

The purpose of the disclosures is to:

Present the terms/cost of the loan in a clear and consistent manner.
Allow for comparison shopping and re-evaluation of borrowing an alternative loan during the application process.
Present lower cost federal options that should be exhausted prior to considering an alternative loan.
Reduce overall borrower indebtedness.

The student is required to complete the Alternative Loan Self-Certification Form and return it to the Alternative Loan Lender. The Alternative Loan Lender will not disburse any loan funds until the student’s completed form has been received.

Below are instructions on how to obtain information that is required to complete the Alternative Loan Self-Certification Form.

Cost of Attendance & Estimated Financial Assistance (Section 2 of the form)

Part A: Cost of Attendance (COA)

For Traditional Undergraduate students, please refer to Undergraduate Estimated Cost of Attendance for specific amounts.
For Professionals or Graduate students, the COA is variable based on the number of units the student is registered in per term and the number of terms he or she attends CLU in an academic year. Contact the Financial Aid Office to find out more about specific COAs.

Part B: Estimated Financial Assistance (EFA) Please follow these steps to determine your EFA:

Accept or Reject Financial Aid.
Add together all accepted aid (in scholarships, grants, Federal Work Study, Federal Stafford Loans, and Parent PLUS Loan) for the academic year.
Use the total amount as your Estimated Financial Aid (EFA) amount. Your EFA should not include the current Alternative Loan that you are applying for.

Part C: Difference between COA and EFA

The difference between the Cost of Attendance and Estimated Financial Assistance is the maximum amount of Alternative Loan that a student is eligible to apply for.

The student should contact the private loan lender to submit the self-certification form.

All self-certification forms must be sent to the private loan lender. If a private loan lender requires the self-certification form, the loan cannot be processed until the lender has received that completed self-certification form in addition to other disclosures that require the student’s signature. Cal Lutheran recommends that all students follow up with their private loan lender to be sure that they have completed all necessary steps.

STEP 3 - Submit a Cal Lutheran Private Loan Request Form

Once you know the loan amount you are approved for by your lender, the final step is to complete the online Cal Lutheran Private Loan Request Form. Please allow 2-4 weeks for the loan to be certified by the Financial Aid Office.

The Private Loan Request Form is REQUIRED for Cal Lutheran to certify your loan application.