Private Student Loans

Private student loans are educational loans designed to help cover the costs when federal, state, and institutional programs are insufficient or when a student is ineligible for federal loans.  Terms of eligibility and repayment vary.  Most require a creditworthy cosigner with some offering a cosigner release usually after a period of on-time repayment.  Some private loans require the student to meet the school’s academic progress requirement, while others do not.  It is advised that students fully utilize all federal, state, and institutional aid before seeking private loans.  Please note it is the responsibility of the borrower to ensure that the Albright College Financial Aid Office receives the request for certification from the lender they choose.

Please see Albright College’s preferred lender list for private loans.

Borrowers have the right to select any lender they choose and Albright College’s Office of Financial Aid is happy to work with any lender.  Preferred lenders have been selected based on competitive pricing, borrower benefits, and service to borrowers and the school.  To understand how and why Albright College chose these lenders, please read about our selection process.

The Higher Education Act of 2008 sought to protect student loan consumers and amended the Truth In Lending Act (TILA) and established disclosure requirements for private education loans. (Regulation Z)

As a result of this change, all private lenders are required to collect from an applicant a self certification form before a private loan can be processed.  The form is designed to remind students about other sources of financial assistance and federal loan options.  The form seeks to collect from the student their cost of attendance and expected financial assistance at Albright College.  This information will be used by the lender as part of the eligibility determination process.  Lenders will provide you with the form at the time of application. 

• The total Cost of Attendance includes estimates for tuition, fees, room, board, books, and personal, transportation, and living expenses.
• Your estimated financial assistance is provided on your award letter.

*Important Note:  The Cost of Attendance information provided is for traditional, full time, on-campus, day students.  If this is different for you, please contact the Financial Aid Office for a more accurate cost of attendance.

Students need to complete the FAFSA before applying for a private loan so that they have an estimate of their financial assistance.

The Higher Education Opportunity Act also requires preferred lenders to annually provide schools with information regarding the private education loans that will be offered to the school’s students.  Accordingly, please find the Lender Disclosures for the 2010-2011 Academic Year.  The Disclosure provides general information regarding rates, terms, cost examples, and eligibility requirements.  A Loan Approval Disclosure Form will be provided with specific loan details after the application is approved.  Rates may vary depending on the creditworthiness of the borrower.

Albright College’s Preferred Lender List Selection Process

Federal loan regulations, set by the Department of Education, require a school that chooses to provide a Preferred Lender List to borrowers to disclose their method of selecting the lenders included on their list of suggested lenders.  This guide is to provide information to borrowers about the method Albright College’s Financial Aid Office used to create their current Preferred Lender List.

According to Section 682.212 of the Federal Register, published by the Department of Education, “A school may, at its option, make available a list of recommended or suggested lenders, in print or any other medium or form. For use by the school’s students or their parents, provided such list-

• Is not used to deny or otherwise impede a borrower’s choice of lender
• Does not contain fewer than three lenders that are not affiliated with each other
• Does not include lenders that have offered, or have offered in response to solicitation by the school, financial or other benefits to the school in exchange for inclusion on the list or any promise that a certain number of loan applications will be sent to the lender by the school or its students” (U.S. Department of Education, 2007).

Why a Preferred Lender List?
A preferred lender list provides a comparison of selected lenders in relatively consistent terms, reducing confusion and assisting borrowers and their families in making the best-informed decisions.

Steps Taken With Selection Process

• A Request for Information (RFI) was sent out to lenders (who are still lending) most often chosen by Albright College students over the past two years, with a list of questions regarding their products and services.  The questions included the following topics:
  • Origination Fee
  • Grace Period
  • Standard Repayment Term
  • Extended Repayment Term
  • Current Interest Rate
  • Interest Rate Ceiling
  • Interest Rate Structure
  • Up-Front Borrower Benefits
  • Possible Guarantors
  • Possible Loan Servicers
  • Borrower Benefits at Repayment
  • Additional Discounts
  • Percentage of Borrowers who Qualify for Benefits
• Once all information had been gathered and reviewed, the Financial Aid Office used the criteria listed below to evaluate and choose the Preferred Lenders.  Throughout the decision process, the Financial Aid Office’s goal was to select a list of reliable lenders who would be able to provide beneficial products and services to the Albright College community.

Criteria Used to Select Lenders

• Borrower Benefits

In considering benefits, it was important to evaluate the lenders who offer borrower benefits to the students as well as the percentage of the actual borrowers who qualified for such benefits.  Such borrower benefits that were evaluated included the following:

• Interest rates and terms
• Fees paid by the lender, versus the responsibility of the borrower
• Availability of repayment options
• Back-end borrower benefits (for example principle reduction, interest rate reduction, etc.)

• Quality of Lender Products and Services

In evaluating lenders’ quality of products and services, it was important to determine which lenders provide exceptional customer service to its borrowers as well as the school.  Such quality products and services criteria used to evaluate each lender are as follows:

• Ease of  application process
• Web-based application and services
• Proactive customer communication, including easy access to borrower’s current and cumulative borrowing and estimated repayment information
• A toll-free number for information and advice
• Timely and responsive processing of loans including resolving issues
• Knowledgeable customer service representatives
• Dedicated service or marketing representative assigned to the school
• Lenders practice to recommend students to maximize Federal financial aid first

• Lender Stability

With regulatory changes and market instability affecting lenders’ decisions to remain in the student loan industry, it was important to select lenders who are reliable and will continue to service borrowers for future years.  Such lender stability criteria used to review each lender included the following:

• Mission Statement
• Number of years in the student loan business
• Source of stability of capital used in providing loans
• Existing relationships with guarantee agencies
• Default rates
• Reputation at the local, state, regional, and national levels
• Demonstrated security of borrower information

Code of Conduct

Albright College is committed to providing our students and their families all relevant information with regards to financial aid that will help them make informed choices that best suit their needs.  For this reason and in accordance with the Higher Education Opportunity Act (HEOA) which requires that all higher education institutions participating in a federal student loan program develop, publish, administer and enforce a code of conduct with respect to financial aid and student loans, Albright College has adopted the following Financial Aid Code Of Conduct:

• The College will not participate in any revenue-sharing arrangement with any lender
• Officers, employees or agents of the College who are employed in the Financial Aid Office or who otherwise have responsibilities with respect to education loans will not solicit or accept any gift (other than those of de minimus value) from any lender, guarantor or servicer of educational loans
• Officers, employees or agents of the College who are employed in the Financial Aid Office or who otherwise have responsibilities with respect to educational loans will not accept any fee, payment or other financial benefit (including the opportunity to purchase stock) from any lender or affiliate of any lender as compensation for any type of consulting arrangement or other contract to provide services to a lender or on behalf of a lender relating to education loans
• The College will only assign a first-time borrower’s federal loan to the Federal Government as the lender.  The College will be the lender for all Perkins Loans
• The College will not assign a student’s private loan to a particular lender or refuse to certify or otherwise deny or delay certification of any private loan based on the borrower’s selection of a particular lender or guarantor
• The College will not request or accept from any lender any offer of funds for private education loans to students, including funds for an opportunity loan pool, in exchange for the College providing the lender with a specified number or volume of Title IV loans or a preferred lender arrangement with respect to such loans
• The College will not request or accept from any lender any assistance with call center or Financial Aid Office staffing
• Officers, employees or agents of the College who are employed in the Financial Aid Office or who otherwise have responsibilities with respect to education loans, and who serve on any advisory board, commission or group established by any lender, guarantor, or group of lenders or guarantors, will not accept anything of value from the lender, gurarantor, or group of lenders or guarantors, except for reasonable reimbursement of expenses incurred in serving on such an advisory board, commission or group