Federal Loans vs Private Loans Comparison
It is important to know the differences between a federal loan and a private loan. Differences in eligibility, interest rates and repayment schedules exist between the various loan types.
| Federal Direct Student Loans | Federal Direct Parent Loans (Parent PLUS) | Private Loans | |
| Borrower | Borrower is the student | Borrower is the Parent | Borrower is the student, and the student should have a co-signer to secure the loan at the best possible rate. |
| Credit Check | N/A | Parent must pass a credit check. Cannot have an adverse credit report or be in default. | Borrower (and co-signer) must pass a credit check. Cannot have an adverse credit report or be in default. |
| Repayment | Repayment begins six months after the student graduates or ceases to be enrolled at least halftime. |
Repayment is 60 days after the final disbursement of the academic year or may be deferred until 6 months after the student graduates or ceases enrollment. | Repayment options vary from lender to lender. |
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| Registration Requirement (undergraduate students) | Student must be registered for at least 6 hours and making satisfactory academic progress. |
Student must be registered for at least 6 hours and making satisfactory academic progress. | Some lenders allow students to be enrolled less than 6 hours and be USAP (unsatisfactory academic progress). |
| FAFSA | FAFSA must be on file. |
FAFSA must be on file. | A FAFSA is not required, but is recommended, to take advantage of the federal loan programs. |
| Application Required | First-time borrowers must complete:
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Borrowers must complete:
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Borrowers should apply with the lender of their choice. BGSU offers this comparison tool as a reference tool to several lending options: ELMSelect - Bowling Green State University |
Additional Types of Aid
Updated: 12/20/2024 09:22AM