Compare Alternative Student Loans to PLUS Loans
Alternative Loan Benefits:
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Borrow up to the true cost of education
- Fast eSignature process
PLUS loans (Parent Loans for Undergraduate Students) are recommended for dependent undergraduate students as a supplement to Stafford loans.
There are some situations, however, in which alternative student loans may be another option or a complementary choice to PLUS loans. We compare alternative student loans to PLUS loans below:
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Loan Ownership
In some cases, parents willing to assist their children in borrowing for a college education may not want to have loans taken out in the parents' names. PLUS loans require the parent to borrow and assume the full obligation of the loan, whereas alternative student loans typically only recommend that parents co-sign for the loan.
Difference - An alternative student loan is taken out by the student and the obligation to repay is the student's first.
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Financial Disclosure
Some parents are uncomfortable disclosing their full financial history to the Department of Education using the FAFSA form, and thus will not complete a FAFSA with a student. Those students are ineligible for federal student loans without a FAFSA on file and some schools will not certify a PLUS loan without a FAFSA on file as a matter of policy.
Difference - Alternative student loans require no FAFSA information from the student or parent.
Parents: Need money for school? Consider a Private Parent Loan.
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School Eligibility
Students may be attending a school (many vocational, technical, and trade colleges fit in this category) which is not Title IV certified, meaning that the school does not participate in the Federal Direct Loan Program (FDLP). PLUS loans are unavailable to parents of students attending these schools, but some of them may accept alternative student loans.
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Independent Students
PLUS Loans were originally designed for the parents of dependent undergraduate students and thus independent undergraduate students are ineligible for PLUS loans. While Stafford loans can certainly help to pay a portion of a college education, independent students should look to alternative student loans (with a non-parental cosigner when possible) to fill in the remainder of their financial need.
For more information: compare student loans, check out our frequently asked questions page, view our list of list of student loan lenders, or simply get started and apply online.
Student Loan Network recommends that students explore all of their financial aid options, from scholarships and grants to federal student loans, in addition to learning more about alternative student loans.
