Congratulations! You’ve received your college acceptance letters and committed to your top-choice school. But even after submitting the Free Application for Federal Student Aid and receiving your financial aid award letter, your bank account is coming up a bit short on tuition funds. What now?
For some students who need to bridge the gap between their financial aid and their school’s cost of attendance, private student loans can be a viable option. If you’ve decided to borrow from a private lender, keep reading to learn the timing of the private student loan application process, so you can focus on what really matters: earning your degree.
[Read: Best Private Student Loans.]
Timeline of the Private Student Loan Process
Private student loans are completely different from federal student loans, which have strict application deadlines that can vary based on the state in which you live. Private lenders don’t follow the same processes as federal student loan servicers, so the exact path forward depends on which private student loan lender you select as well as the school you’ve chosen to attend.
It makes sense to begin the private student loan application process after you’ve committed to a university. That way, you’ll know how much money you need to borrow as well as the school’s tuition payment deadline. With that information in hand, you’ll want to give yourself a few months to shop around for private student loans.
Many college tuition deadlines are in August, at least several weeks before the start of the semester. Given that timeline, you’ll want to begin applying for student loans around May or June, although you can still apply for private loans in July or even August. Here’s what the timeline looks like:
— April: Receive your financial aid award letters in the mail and select a university by the end of the month.
— May, June and July: Accept your federal student loans, grants and scholarships. Apply for private student loans if you’ve used up the maximum amount of federal aid you are eligible for and need to bridge the financing gap.
— August: Pay tuition by your school’s deadline. It’s important to pay your college tuition on time, since schools usually assess a late fee for missing the payment due date.
It doesn’t usually take very long to apply for a private student loan, with many lenders offering preapprovals in just minutes. Still, it can take a few weeks to get full approval if your application hits any snags, so it’s best to give yourself plenty of time to avoid missing any tuition deadlines.
You should also leave time to compare private student loan offers, shopping around for the lowest interest rate and best repayment terms possible for your financial situation.
What You Need to Apply for a Private Student Loan
Being prepared for your private student application can make the process go smoothly and help avoid delays. You’ll be asked to provide the following information and documents when you submit your private student loan applications:
— Personal information, like Social Security number, photo identification (driver’s license or passport), permanent address, phone number and email.
— School information, like enrollment verification, program details (degree type and graduation date) and your school’s cost of attendance (tuition, fees and other expenses).
— Financial information, like proof of income (tax returns or pay stubs), bank statements and requested loan amount. You’ll also need to consent to a credit check.
Keep in mind that private student loan approvals are based on your credit rating — and many young adults don’t have an established credit history. The vast majority of private student loan borrowers have cosigners who are willing to take on the responsibility of repaying the loan if they can’t make payments.
Borrowers who applied for a private student loan through Sallie Mae were three-and-a-half times as likely to be approved with the help of a cosigner, according to the lender.
Before you apply, identify a creditworthy cosigner like a parent or guardian. You’ll need their personal and financial information to complete the private student loan application. Some lenders offer a cosigner release, which removes the cosigner from the loan after a certain number of on-time monthly payments.
[Read: Best Parent Student Loans: Parent PLUS and Private.]
Do You Need to Reapply for Private Loans Every Year or Semester?
You must fill out the FAFSA every year, which means that your financial aid package can vary from one academic year to the next.
That being said, while some private student loans require you to apply for a new loan for each academic period (which can be a semester or a full academic year), others offer multiyear approvals. You might be seeing a trend here: The process depends on the lender you choose.
Since applying for a private student loan requires a hard credit inquiry, getting approved for multiple years at once can limit the negative impact on your credit score — and that of your cosigner. It can also make it smoother to get the financing you need to pay for school.
However, it may be beneficial to shop around for a new private student loan lender for the upcoming school year if your financial situation has improved. For example, you may be able to get a lower interest rate if you or your cosigner have a higher credit score or income, and a lower student loan rate can save you money over time.
More from U.S. News
Will Your Student Loan Company Choose Your Degree for You?
Undergrad Loan Limits Haven’t Risen Since 2008. Why Not?
More Students Will Soon Need Private Loans. 40% Won’t Qualify, Study Finds
When Do I Need to Apply for Private Student Loans? originally appeared on usnews.com
Update 05/08/26: This story was previously published at an earlier date and has been updated with new information.