Information about private loans

Paying for College
1

<p>I am still considering NYU as a possibility for my undergrad. They gave me a really good financial aid package in comparison to what others received, so if I get the lowest priced dorm and meal plan, I'd only have to take out $16,000. I'd be able to take out around $5,000 in federal loans, so the rest would have to be private (I don't want to burden my parents with loans since they're both disabled and do not need any more stress than they already have). </p>

<p>I know that private loans are bad, and everyone says not to take them out, blah blah blah. I've heard it all before, but I need more information about private loans because in the end, I'll make the final decision, so I want to make sure I'm making the right one.</p>

<p>-Where is the best place to take out a private loan? Chase?
-I'm 18. Do I need a cosigner? (I'm not sure if I'd be able to get one)
-Since I'm most likely not going to have a cosigner, is it still possible for me to get a loan?
-How high is the interest rate generally? Is it higher if you don't have a cosigner?
-Do you need credit to take out a loan?</p>

2

<p>Most private lenders will require a cosigner with good credit unless you have sufficient income/resources to satisfy them. Interest rates may depend on the credit score of the cosigner to a certain extent, as well as things like credits for automatic payment. Many have variable interest rates, so they will fluctuate over time. Prime rate is around 3.25% right now, so make sure you look at historical data and understand what a significant bump will do to you.</p>

<p>My guess is that, even if you’re able to find a loan without a cosigner, you will be paying a premium rate. Make sure you compare that to what your state loan plan offers (if one is available) and the Parent Plus loan rates, which are fixed at 8.5%.</p>