Compare Federal PLUS Loans to Private Loans

PLUS Loan Benefits:

• Fixed interest rate - 8.5%
  
• Borrow up to the cost of education

Federal Parent PLUS Loans and Private Student Loans can both help cover the difference between your total cost of education and other financial aid you have received. Both loans can be used to pay for educational expenses such as tuition, books, housing, school fees, student computers, supplies and more.

One of the biggest differences between these two student loans is the interest rate. Federal PLUS loans are based on a fixed interest rate (8.50%). Private Loans have a variable rate and are based on a published index (Prime or LIBOR) plus a margin for borrower credit.

We recommend that you always exhaust Scholarships, Grants and Federal Loans, like the Parent PLUS Loan, before applying for Private Loans.

Federal PLUS Loan and Private Student Loan Comparison

Federal PLUS and "Certified" Private Student Loans are both disbursed to the school's financial aid office. The chart below illustrates differences and similarities:

	Parent PLUS Loan	Private Student Loan
Federal Guarantee
Fixed Interest Rate
Requires school certification
Preliminary approval in as little as 15 minutes
0.25% rate reduction for automatic payments
Up to 20 years repayment term
Funds disbursed to the school

For more information about private student loans, check out our frequently asked questions page, or simply get started and apply online.