Los Angeles City College

2020-2021 Private Loans

Private loans are typically more expensive than Stafford loans. Students that are interested in a private loan must do research to find and compare the loans that are available. The college will determine a student’s eligibility for a private loan after the student’s eligibility for all federal aid has been determined. The student’s eligibility will be constrained by his/her unmet cost. Los Angeles City College does not have relationships nor does it endorse any lender.

Application for Private Loans

• Complete a 2020-2021 Free Application for Federal Student Aid (FAFSA) at the FAFSA website.
• LACC must be the student's home school within the Los Angeles Community College District.
• Pursue a financial aid eligible academic program at LACC.
• Satisfy the general student financial aid eligibility requirements.
• Apply for Federal Direct Stafford Loans (to determine possible eligibility for federal student loans)
• Research private student loan lenders to find and compare available loans
• Complete the application with the lender of your choice
• The lender will evaluate eligibility and will contact Los Angeles City College Financial Aid Office to process a disbursement of the approved loan

Borrowers Eligibility

• Complete a 2020-2021 Free Application for Federal Student Aid (FAFSA) at www.fafsa.gov.
• Pursue an eligible academic program at Los Angeles City College
• Any other eligibility criteria as determined by the lender

Before you apply for Private Loans

There are significant differences between federal student loans and private loans. The following chart summarizes those differences:

Federal Loans	Private Loans
You will not have to start repaying your federal student loans until you graduate, leave school, or change your enrollment status to less than half-time.	Many private student loans require payments while you are still in school.
The interest rate is fixed and is often lower than private loans—and much lower than some credit card interest rates. View the current interest rates on	Private student loans can have variable interest rates, some greater than 18%. A variable rate may substantially increase the total amount you repay.
Undergraduate students with financial need will likely qualify for a subsidized loan where the government pays the interest while you are in school on at least a half-time basis.	Private student loans are not subsidized. No one pays the interest on your loan but you.
You don’t need to get a credit check for most federal student loans (except for PLUS loans). Federal student loans can help you establish a good credit record	Private student loans may require an established credit record. The cost of a private student loan will depend on your credit score and other factors.
You won’t need a cosigner to get a federal student loan in most cases.	You may need a cosigner.
Interest may be tax deductible.	Interest may not be tax deductible.
Loans can be consolidated into a Direct Consolidation Loan. Learn about your consolidation options.	Private student loans cannot be consolidated into a Direct Consolidation Loan.
If you are having trouble repaying your loan, you may be able to temporarily postpone or lower your payments.	Private student loans may not offer forbearance or deferment options.
There are several repayment plans, including an option to tie your monthly payment to your income.	You should check with your lender to find out about your repayment options.
There is no prepayment penalty fee.	You need to make sure there are no prepayment penalty fees
You may be eligible to have some portion of your loans forgiven if you work in public service. Learn about our loan forgiveness programs	It is unlikely that your lender will offer a loan forgiveness program.
Free help is available at 1-800-4-FED-AID and on our websites.	The Consumer Financial Protection Bureau's private student loan ombudsman may be able to assist you if you have concerns about your private student loan.