There are many ways to finance a world-class private education. You can borrow federal direct student loans or alternative loans to help pay for your schooling. Federal direct loans often do not require payment until after you graduate and offer reasonable interest rates.
Find the loan type that works best for you.
Parents can support their student’s education by borrowing a federal Direct Loan. These loans often do not require repayment until the student graduates and come with reasonable interest rates. Explore the available plans to find the one that best fits your needs.
The Federal Direct Loan Program offers low-interest loans to undergraduates, graduate students, and parents of dependent students through the U.S. Department of Education. This program includes the Federal Direct Subsidized Loan, the Federal Direct Unsubsidized Loan, and the Federal Direct PLUS Loan. These loan programs were created by Congress to help eligible students and parents cover educational expenses, with or without demonstrated financial need.
Parent PLUS Loan: Biological or adoptive parents of a dependent undergraduate student may apply for a Federal Direct PLUS loan to help meet the student’s attendance costs not covered by
other financial aid. The Free Application for Federal Student Aid (FAFSA) is required,
and parents must complete a Parent PLUS Loan application at
studentaid.gov.
Parents must pass a credit check when applying for a PLUS loan. If a parent’s
application is denied due to credit history, the student may become eligible for an
additional unsubsidized student loan. Freshmen and sophomores may borrow up to $4,000,
while juniors and seniors may borrow up to $5,000.
Parent and Graduate PLUS loan applicants who qualify by obtaining an endorser or through
a credit appeal are required to complete PLUS Loan Counseling at
studentaid.gov.
Federal Direct PLUS loans disbursed between July 1, 2025, and July 1, 2026, carry a fixed interest rate of 8.94%. Interest accrues from the date of disbursement until the loan is paid in full.
The federal government charges an origination fee for Direct Loans. This fee is a percentage of the total loan amount and is deducted from each loan disbursement. You are responsible for repaying the full amount borrowed.
| Loan Type | First Disbursement Date | Loan Fee |
|---|---|---|
| Federal Direct PLUS Loan | On or after 10/1/25 and before 10/1/26 | 4.228% |
Alternative loans are private educational loans that students or parents (often with a parent as a co-signer) can take out to cover the gap between the total cost of education and the amount available through federal loan programs. These loans are offered by private lenders and do not require any federal application forms.
Eligibility is typically based on credit history. Lenders may offer fixed or variable interest rates along with multiple repayment options. Borrowers may choose any lender.
Students or parents must apply directly to their chosen lender. Most students
will need a co-signer on the loan application. Interest rates are set by the lender and
are based on the creditworthiness of the student and any co-signer.
Borrowers may choose any lender. The FASTChoice alternative loan tool provides guidance on funding options, money management, and borrower responsibilities. After reviewing the information, users can view and compare a list of participating lenders and their loan products.
The University of Lynchburg has recently streamlined the Parent and Graduate PLUS Loan application process, which is now completed on studentaid.gov.
Parents and Students must first fill out and submit the FAFSA.
Log in to studentaid.gov. PLUS Parent Loan borrowers must sign in using their FSA ID, not the student’s.
If the PLUS Loan is denied for credit reasons, you may choose to obtain an endorser or provide documentation to the Department of Education to appeal the credit decision. Contact the Department of Education at 1.800.433.3243 to start an appeal or obtain detailed information about the endorser addendum.
Federal loans, including Direct and PLUS loans, are generally the best options and should be your first consideration. The maximum interest rates and fees on these loans are set by federal law, so their terms and conditions are clearly defined and may not change over time.
Alternative loans cannot exceed a student’s cost of attendance. Most alternative loans go into repayment after the student graduates.
Alternative loans are private education loans in the student’s or parent’s name that help bridge the gap between the actual cost of your education and the amount the government allows you to borrow in its programs.
Private loans are offered by private lenders, and there are no federal forms to complete. Eligibility for private student loans often depends on your credit score.
