Alternative Loans
Alternative Loans should be considered only as a last resort when financing your college education. We strongly encourage students to accept any offered Federal Direct Stafford Loans before considering Alternative Loans. Additionally, graduate students are encouraged to apply for a Federal Graduate PLUS Loan before applying for Alternative Loans.
Generally, students receive better interest rates on Federal Student Loans than with Alternative Loans. However, if you require additional funding beyond your Federal Student Loan eligibility, Alternative Loans may help you cover unmet educational expenses. Researching different private lenders and their loan products, their benefits, as well as exploring other means of financial aid before applying for an alternative loan, is to the advantage of the student. We recommend that you use alternative student loans conservatively as the interest rate could be variable.
Alternative Loans are made by banks and other financial institutions and are subject to their terms. Eligibility for these loans requires a credit check and students are often required to have a co-signer to qualify. Each lender uses its own pricing model, based on either the LIBOR (London Interbank Offered Rate) or prime rate (as published in the Wall Street Journal) and typically based on the strength of the credit score and history of the student and/or cosigner. Depending upon the lender chosen, interest accrues from the date of disbursement and can be paid while the student is enrolled, or deferred and capitalized at the time of repayment. All lenders require the completion of a Self-Certification Form. If your lender has not provided this for you, these forms are also available in the Financial Aid Office.
Tennessee Tech University does not endorse or recommend any specific private alternative loan lender. In determining which Alternative Loan is best for your needs, we recommend you research and compare loan interest rates, fees, repayment options, and eligibility requirements.
Tennessee Tech University utilizes FASTChoice to display its historical Alternative Loan Lender List. The lenders and loan options presented include all lenders used by Tennessee Tech students within the past 3 years.
FASTChoice offers the ability to:
- Compare and contrast lenders so you can choose the best option for your financial needs
- A payment calculator tool to help you figure what your future student loan payment may be
- A glossary tool to help define any loan or financial terms you may not be familiar with
- A Borrowing Essentials tool to instruct borrowers on the basics of taking out a private Alternative Loan and how your lenders determine if you are eligible and approved
- The ability to apply for an Alternative Loan once you have decided which loan is best for you
You can access FASTChoice by clicking here.
Students are free to select their lender of choice, including those not represented in our Alternative Loan Lender List. Application processing will not experience delays if you choose a lender not represented on the Lender List. If you choose a lender that is not represented, contact your lender and request that they send certification requests via ScholarNet. If your lender of choice does not participate in ScholarNet, please have the certification request sent via email to financialaid@tntech.edu with the subject ATTN: Loan Specialist.
Alternative Loan Application Process
1. Many Alternative Loan lenders provide an online application. After carefully comparing the different lenders' loan terms, you may want to verify the following information with the lender if you are not sure:
- What will your interest rate be?
- Are there any fees deducted from the loan before you receive your loan funds?
- Are you required to start replaying the loan while enrolled?
2. After you apply, your chosen lender will send you three separate disclosures during the Alternative Loan process that you must sign and return to the lender in a timely manner. Additionally, you must complete a Self-Certification Form sent to you by your lender.
3. After you are Pre-Approved for the requested loan amount and have returned all required paperwork to the lender, the lender will send a certification request either by paper form or electronically to Tennessee Tech's Financial Aid Office. The Financial Aid Office certifies maximum loan eligibility up to the Cost of Attendance, minus other financial aid and resources.
4. If you have submitted all required paperwork and the Tennessee Tech Financial Aid Office has completed the certification request, the lender should be ready to disburse your loan funds to Tennessee Tech depending on your requested loan period. If you have a Fall/Spring loan period, half of the loan amount requested will be disbursed equally between the Fall and Spring semesters.
Because it can take up to 3–4 weeks for an Alternative Loan to process, we recommend you apply at least 4 weeks before the loan funds are required. Lenders automatically require a 10-day waiting period before any funds are released to the university.
Code of Conduct
The federal Higher Education Opportunity Act (HEOA) of 2008 established a code of conduct applicable to financial aid employees and universities as they administer the Title IV Loan program. In general, the Code prohibits any financial aid employee or university from participating in any revenue-sharing arrangements with any lender, or from receiving gifts from any lender, guarantor or loan servicer in exchange for providing Loan Funds to its student population.
As detailed in our Code of Conduct Tennessee Tech Officials are prohibited from accepting any financial or other benefits in exchange for displaying lenders and loan options in FASTChoice. Prohibited activities include:
- receiving compensation to serve on any lender board of directors or advisory boards;
- accepting gifts including trips, meals, and entertainment;
- allowing lenders to staff our institution’s financial aid office;
- allowing lenders to place our institution’s name or logo on any of their products;
- and owning of lenders’ stock (for college officials who make financial decisions for our institution).
