Skip Navigation
School Search Form
After Navigation
Home Ask Student Aid FAQ What is the Difference Between Federal and Private Student Loans

What is the Difference Between Federal and Private Student Loans

Here are some of the key differences between Federal Student Loans vs Private:

  Private Student Loan Federal Student Loan
Lender Bank, credit union, financial institution, state agency, or college/university U.S. Department of Education
FAFSA Required? No Yes
Interest Rate Type Fixed and variable options available Fixed
Rates Based on Credit Criteria? Yes No
Cosigner Required? Yes, unless borrower has strong credit history No*
Repayment Plans Varies by lender. Some lenders may offer multiple options. Multiple plans (including income-driven) available
Forbearance Options Varies by lender. Typically one year. Three years

*Direct PLUS Loans offered to parents of students attending college, or graduate students, require a credit check. If the borrower is found to have adverse credit, a cosigner may be required.