Private (Alternative) Loans

Private/Alternative Loans

Northwood University recommends that you file your FAFSA (Free Application for Federal Student Aid) and exhaust your federal aid and any available scholarships prior to applying for a private loan.

Private/alternative loans are credit-based student loans offered by private lenders, such as banks and credit unions. Because these loans are not guaranteed by the federal government, private loans may have terms that vary from lender to lender a co-borrower may be required, depending on your credit history and credit worthiness.

Private loans are not for everyone.  You should compare and exhaust all of your Federal loan options before considering private loans.  Since a credit check is performed, not everyone is approved for private loans.  Generally, borrowers with better credit histories receive better loan terms.

Northwood University does not provide a preferred lender list. However, below is a comprehensive list of active lenders used by our students within the past academic year.  You are by no means limited to these lenders - it's just a helpful starting point.  Visit the web sites and thoroughly read all literature from the lenders to determine the loan programs that would best suit your needs.  While reviewing, keep in mind these shopping tips.

Alternative loan programs:

  • May have minimum enrollment requirements.
  • May have satisfactory academic progress requirements.
  • Have different deferral options.
  • May have origination fees or application fees.
  • May have higher interest rates and more stringent repayment terms than Federal Direct Stafford Loans.
  • May not have a cap on a variable interest rate or a limit on how frequently your rate is adjusted.
  • May have incentives during repayment that do not carrying forward if your loan is subsequently sold to another lender.

Where to begin:

To assist students in choosing a private loan lender Northwood University suggests using the Elm Select Loan Comparison Tool Northwood University does not endorse any private educational loan lender or lending program. A borrower has the right to choose any lender, whether it is on Northwood University’s site or not.

Calculating loan amounts/eligibility

There are two parts to determining how much money can be borrowed through an alternative loan – lender credit approval and school certification.  The lender will approve the requested loan amount based on the borrower’s and cosigner’s credit report.  Then, they rely on the school to certify eligibility for the requested amount.  Eligibility is calculated the same regardless of the lender chosen:  Estimated Cost of Attendance (COA) minus all other financial aid and outside resources equals the maximum alternative loan amount.  Students with a FAFSA on file can view their estimated Cost of Attendance on WebAdvisor. Students without a FAFSA can see estimated costs here.  Northwood University will be using these numbers when we provide our certification to the lender.

Therefore, it is possible that a lender will approve a loan for $12000, for example, but Northwood University certifies a lesser amount.  The lesser amount is what the lender is going to disburse as the borrowed amount.

The Application Process

The application process for alternative student loans includes a credit check. During this process your lender will provide you with a disclosure statement detailing your interest rate and confirming your acceptance of the loan.

Once the lender has approved your loan, the lender will contact Northwood University to request loan certification. NU will usually certify your loan within two (2) weeks of notification from lender.  Please note that loan certification can take longer during the beginning of a semester, so it is recommended you apply at least one month prior to the start of a semester.  After NU certifies your loan, the lender must mail a final disclosure to you, giving you a three (3) day cancellation period of the loan.  The lender is required to allow a minimum mailing and processing time for the final disclosure to be received by you before they can send funds to NU.  Generally, this requirement can result in seven (7) to ten (10) days for loan funds to be sent to Northwood University once the certification has been completed.

Your loan funds will be sent to Northwood University electronically and applied to your student account once received.
 

Complete Your FAFSA

Complete Master Promissory Note

Academic Catalog

Net Price Calculator

Student Loan Code of Conduct