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Student Financial Aid
Student Services  :  Student Financial Aid  :  Alternative Loan Programs

Alternative Loan Programs

What is an Alternative loan?

Alternative loans are available to students who need to bridge the gap between their educational related costs and their financial aid awarded. Traditional financial aid resources may not be enough to cover all of a students cost while they attend school.

Alternative loans are not guaranteed by the federal government, they must be insured privately. This is a cost that the private loans lenders may pass onto the borrower in the form of hidden fees and interest rates. Terms and conditions can vary according to the specific lender.

Alternative loans are determined by the students credit worthiness and the amount the school determines a student can have.

How much can I have in an Alternative loan?

The amount a student can take out is determined by the Cost of Attendance (COA) minus the other financial aid awarded. The lender may also have a loan minimum/maximum that a student can borrow.

Example: COA $ 43000
--other aid awarded $ 20500
$ 22,500 is the amount a student can take out in an Alternative loan

You can contact our office at 913-588-5170 or by email at financialaid@kumc.edu to determine the amount you are eligible to take out for the academic year. We strongly suggest you contact our office before you apply for an Alternative loan. This is to insure that you do have unmet need eligibility to apply for an alternative loan.

What are the eligibility requirements?

These requirements may vary by lender but these are the most common requirements.

  • Undergraduate or Graduate/Professional student in a degree or certificate program
  • Enrolled at least half time
  • Be a credit worthy borrower or borrower with a credit worthy co-signer
  • Student may be required to be a US citizen, permanent resident or eligible non-citizen
  • Making satisfactory academic progress


What factors should I consider before choosing an Alternative loan?

We cannot choose a lender for you but offer these tips in considering which lender is best for you. Use caution in how many lenders you apply with because each application will cause an inquiry on your credit report.

  • What is the interest rate and what is it based on? http://www.bloomberg.com/markets/rates/
  • What is the LIBOR?
  • What is the Prime Rate?
  • What is the possible interest rate for this loan?
  • When does repayment begin?
  • Can principal and interest be deferred?
  • How much is the loan origination fee?
  • Is a co-signer required?
  • What is the loan maximum I can borrow each year?
  • What is the minimum I can borrow each year?
  • Can I borrow to cover past due balances from a previous term?
  • Are there any interest rate reductions or other incentives for borrowers who make their payments on time?
  • Will my lender sell my loan to another agency/company? If so, will the terms change?
  • Can I repay with no penalty?
  • Does my lender offer a co-signer release option?
  • Will the lender capitalize interest? How often?

What is my Credit Score? Credit Agencies
www.experian.com
www.transunion.com
www.equifax.com

MyFico has all three credit agencies on their credit report.
www.myfico.com

What your score means?
500 and above= worst interest rates
500-580= higher interest rates
580-620= higher interest rates
620-640= good interest rates
640-650= good interest rates
650-680= very good interest rates
680-700= very good interest rates
700-720= very good interest rates
720 and above= best interest rates

How do I apply for an Alternative loan?

Students should apply online with the lender of their choice. It is important to note that students should pay close attention and make sure you are applying for an Alternative loan and not a Stafford loan.

For more information, contact the Department of Student Financial Aid, (913) 588-5170 or email financialaid@kumc.edu