Private education loans may have significant disadvantages when compared with federal education loans.
We recommend that you exhaust all federal grants and loans available to you before considering a private (alternative) loan. You may qualify for loans or other assistance under Title IV of the HEA (The Federal Pell Grant, FSEOG, Direct Loans and PLUS loans) and the terms and conditions of Title IV, HEA program loans may be more favorable than the provisions of private education loans. Homeowners may also want to consider a home equity loan first. Oklahoma City University has developed a list of private loan providers for students who need a focused and neutral resource for help in finding a private student loan. The lenders appearing on our "ELM Select Listing" are lenders with which our students have had success in the past. Standard disclosures for each loan can be found by clicking on the lender listed on the ELM Select List.
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There are many Private lenders offering to consolidate Federal Student Aid loans with private loans. If you are considering this, we highly recommend you do not unless you have consulted with a Tax and Finance professional. Consolidating Federal Loans into Private Loans will remove the following protections:
- Federal student loan regulations offer a variety of repayment plans, including income-driven repayment plans designed to assist borrowers who are unable to afford their current monthly payment amount. Income-driven plans allow monthly payment amounts to be adjusted annually based on the adjusted gross income, family size, and state in which a borrower resides. The outstanding balance, if any, may be forgiven after 20 or 25 years of qualifying payments. Refinancing into a Private Loan removes this benefit.
- Under federal student loan regulations, the borrower is offered several deferment, forbearance, and repayment plan options during the life of the loan. If the federal student loan is refinanced into a private loan, none of these options will be unavailable.
- Subsidized federal loans qualify for an interest subsidy while in school, grace, deferment, or during certain circumstances of the Income-Based Repayment and Pay As You Earn plans. Once again, these would disappear if the loan was turned into a private loan.
- Full-time active duty service members may lose certain deferments, forbearance, or other benefits afforded to them under federal student loan regulations.
- Military service members who qualify for a 0% interest rate due to receiving hostile pay will lose the that benefit. Borrower benefits of lower interest rates or incentives provided by current federal student loans may be forfeited and could result in the borrower having to pay more over the life of the loan.
- Borrowers working in certain professions like those employed full-time by a public service organization or serving in a full-time AmeriCorps or Peace Corps position, government or those employed as teachers in certain situations, may be eligible for loan forgiveness on some or all of their federal student loans. If a student refinances a federal loan into a private loan, it will no longer be eligible to for these federal loan forgiveness programs.
- Federal regulations provide the borrower with circumstances where the loan may need to be discharged. If a federal student loan is refinanced into a private loan, most, if not all of these options for discharge will be unavailable.
- Regulations could be introduced by the President, Congress, or the Department of Education at a later date that would provide additional benefits to federal student loan borrowers. These benefits will not be available to borrowers who refinance federal loans into private loans.
- Once a federal student loan is consolidated into a private loan, the process may not be reversed in order to re-establish the original federal loan and the benefits that were forfeited.
PRIVATE LENDER REGULATORY DISCLOSURES: These may be accessed on their individual websites.
Oklahoma City University has NO affiliations with any private lenders. OCU HAS RECEIVED NO CONSIDERATION FROM ANY LENDERS FOR PLACEMENT ON THIS LIST. Placement on this list DOES NOT in any way constitute an endorsement from OCU NOR should it be construed as a preferred lender list. You are free to borrow from any lender of your choice. While OCU has made every effort to confirm each of the lender's loan terms described through website research and multiple calls and visits with the lender customer service representatives, OCU cannot guarantee its accuracy. Furthermore, not all the lenders listed lend to all students at all schools. The borrower should confirm any and all loan terms with the lender PRIOR to accepting the loan. Each lender's position on the list is randomly determined and will change each time the ELM Select page is refreshed. OCU will update this page as necessary and will provide the date of the last update at the top of this page. The information provided below is subject to change without notice. Click here for the Oklahoma City University Code of Conduct.
Interest Rates
- For current LIBOR information, please visit http://www.bankrate.com/brm/ratewatch/other-indices.asp.
- For current prime rate information, please visit http://www.bankrate.com/brm/ratewatch/wsjPrimeRate.asp.
Fees: The fees charged are typically added to the principal amount owed at the time they are assessed.
- Origination Fees are assessed upon receiving the loan.
- Repayment Fees are assessed upon entering repayment.
- Late payment fees are also typically charged by the lender, but those fees are excluded from the table above.
Auto payments: Automatic debit payments made via a bank account. Many lenders offer a benefit in the form of an interest rate reduction for signing up for these automatic payments.
IRR - Interest rate reduction: Benefits awarded to the borrower that lead to the interest rate being reduced can include signing up for auto payments, making a certain number of consecutive on-time payments, and simply by graduating.
Co-Signer Release - Student has had loan co-signed (typically by a parent or close relative). A number indicates the number of consecutive, on-time monthly payments required for co-borrower release. In many cases, students must meet some credit-based criteria in addition to making the on-time payments.
