Federal student loans are available to most students regardless of income and provide a range of repayment options including income-based repayment plans and loan forgiveness benefits, which other education loans are not required to provide.

Private education loans are an option for financing your education and are provided to students or parents from a commercial, state-affiliated, or institutional lender used to pay for up to the annual cost of attendance, less any financial aid received. Private loans have varying interest rates, fees, and repayment options and usually require the applicant to be creditworthy or have a creditworthy co-signer. Repayment generally begins immediately.

Federal, state, and university policy recommends that student borrowers maximize federal loans before the private loan request is processed. Complete a Free Application for Federal Student Aid (FAFSA) or California Dream Act Application (CADAA) in order to determine student loan eligibility.

StudentAid.gov provides a federal and private loan comparison. Here are some things to consider: 

• Private loan eligibility requirements vary from lender to lender
• Private loan lenders can offer variable interest rates that can increase or decrease over time, depending on market conditions
• Students may also be required to meet citizenship requirements or provide a co-signer who meets citizenship requirements
• The interest rate on a private loan may depend on the borrower’s and/or co-signer’s credit rating
• Other eligibility requirements may apply depending on the lender
• Review the interest rate and processing fees prior to borrowing

UC Davis is not involved in the private loan credit decision. All credit decision questions should be directed to the loan lender. Financial aid eligibility applies to all certifications of loan amounts.