Student/Parent Alternative Loans

2009-2010 Alternative Loans

Please be advised that we have updated the student and parent loan information on the web.  Check back often on the Financial Aid web pages for updated loan information (updated as of 6-24-09).

Private Educational Loans, also known as Alternative Education Loans, help bridge the gap between the actual cost of education and the limited amount the government allows a student to borrow in its student loan programs.

Private loans are offered by private lenders and there are no federal forms to complete.  Eligibility for private student loans often depends on a borrower's and co-borrower's credit score.

Private education loans tend to cost more than the education loans offered by the federal government, but are less expensive than credit card debt.  Federal education loans offer fixed interest rates, better repayment and forgiveness options.  Since federal education loans are less expensive than private student loans, exhaust eligibility for federal student loans before resorting to private student loans.

Private student loans typically have variable interest rates, with the interest rate pegged to an index, such as LIBOR or PRIME, plus a margin.

The LIBOR index is the London Interbank Offered Rate and represents what it costs a lender to borrow money.

The PRIME Lending Rate is the interest rate lenders offer to their most credit-worthy customers.  A rate of LIBOR +2.93% is roughly the same as PRIME + 0.0%.  As of June 16, 2009: Libor is 0.32% and Prime is 3.25%.  To check the current index rates, check out BankRate.

Merrimack College is pleased to present a recommended lender list comparison for the following educational 09-10 student/parent Alternative loans.  Click 2009-2010 Alternative Loan Brochure.pdf to view the comparison of lenders for Alternative Loans.  Be advised that the information listed in this comparison is noted as of June 8, 2009.  Merrimack College strongly recommends that a borrower contact the lender(s) for up-to-date information via the telephone number or web address listed below.

UPDATE (7/23/09) Effective July 31, 2009 Chase Select pricing will be changing.  Please refer to the Chase website link below to see updated information.

 Lender

Telephone

 Web Access

J.P. Morgan Chase

 866-306-0868

www.chaseselectloans.com 

Citibank

 800-788-3688

www.studentloan.com/schools/merrimack 

RBS Citizens 

 866-259-3767

www.citizensbank.com/trufitstudentloan

Discover 

877-728-3030 

www.discoverstudentloans.com 

MEFA

800-266-0243 new loans
800-397-8386 established 

www.mefa.org 

Sallie Mae 

888-272-4665 

www.salliemae.com/smartoption 

 Wells Fargo

800-658-3567 

www.wellsfargo.com/student 



Please note that you are not obligated to obtain an Alternative student/parent loan through one of these lenders.

The Merrimack College Office of Financial Aid recommends the use of private educational loan programs after all other types of financing options (federal student and federal parent loan programs) are considered.

Before borrowing an education loan, carefully consider present level of debt and repayment obligations on all loans.  Determine how much is needed to borrow by working out a budegt for educational costs and subtracting all other resources (aid offered and accepted).  Remember, the ability to obtain loan funding is largely based on credit-worthiness, and with most programs, the co-signer's credit-worthiness.

Federal Student Stafford and Federal Parent PLUS Loan information can be found on this link.