Short answer: obtaining a federal student loan typically takes 1–3 weeks; however, obtaining a private student loan might take 2–10 weeks.
It takes so long because processing a loan application takes time. Before disbursing money to loan applicants, lenders must do several behind-the-scenes checks.
Due to the distinct lending processes used by the federal government and commercial lenders, there are also distinct timelines. Where the monies are transferred affects the processing time as well. While some monies are sent to the school, others are remitted straight to the student’s account.
Consequently, how long does it take to get a student loan? Knowing the procedure for applying for student loans can give you a clearer understanding of how long it could take you to get the money.
The Federal Student Loan Process
The federal government provides funding for federal student loans. You must submit the Free Application For Federal Student Aid, or FAFSA, to qualify for federal student loans. Federal student loans, merit-based grants, work-study programs, and institutional help are all included in this.
Is it easy to get federal student loans?
Yes, getting federal student loans is often simple. The federal government will determine your eligibility for help when you fill out and submit your FAFSA. Based on the financial data you included in your application, this is. Each student qualifies for a different amount of financial help depending on their financial situation. Regardless of whether you believe you qualify for financial aid, we highly encourage you to submit the FAFSA.
The FAFSA is only good for one academic year, so keep that in mind. To be eligible for financial help for consecutive years, you must submit this application by the deadline each school year. Additionally, depending on changes in your family’s financial situation, your eligibility may vary each year. This implies that the federal financial help you get will vary each year.
How long does it take to get a federal student loan?
The FAFSA is processed, and a financial assistance package tailored to your requirements is put together in roughly 1 to 3 weeks. Your financial help package will be broken out in great detail for you. You must sign a Master Promissory Note if you accept the loan’s conditions and repayment schedule. By signing this document, you accept the loan’s conditions. Federal student loans are only released after this Master Promissory Note has been signed. Please sign the message and submit it as soon as possible to ensure you get the money when you need it.
Federal student loan money is typically issued within 10 days after the first day of courses unless there are exceptional circumstances. If you are a first-year student and a first-time borrower, the money may be disbursed in less than 30 days. The money may be released in this situation 30 days from the start of the payment term.
The Private Student Loan Process
The application procedure for private student loans differs significantly from that for federal student loans. Private lenders provide the money for these loans. Each lender establishes its criteria for qualifying, terms and conditions, interest rates, and a timeline for repayment. Lenders may have quite different requirements. It pays to shop around to receive the best deal when taking out private student loans.
Is it easy to get private student loans?
On average, private student loans are more difficult to get than federal student loans. Private lenders often approve loan requests depending on the applicant’s credit score. You’ll be readily authorized with a good score since you’re a trustworthy borrower.
However, you would have needed more time to establish your credit history as a student. You will find it challenging to be granted a private student loan. Applying with a cosigner with good credit is one way to get around this challenge. This person might be a family member or acquaintance who satisfies the lender’s credit standards.
It might be challenging to find a cosigner for your loan. When someone cosigns for your debt, they share in the loan’s liability with you. They might lose their credit if they don’t make your loan installments.
How long does it take to get a private student loan?
The time it takes for you or your institution to get the money once your loan application is accepted might range from 2 to 10 weeks. If you take out a loan your school has approved, the money will be sent there. The money will be sent immediately into your bank account if you take out a direct-to-consumer loan (or one that is not certified).
Recall that private student loans need to be your final option. These loans have stricter repayment requirements and higher interest rates. Generally speaking, before taking out private student loans, you must complete the FAFSA, apply for scholarships, and use all available government financial assistance alternatives.
Other Things to Keep in Mind About Loans
Despite receiving several scholarships and awards, many students still need student loans. Here are some considerations for private loans if your institution doesn’t give you adequate federal student loans:
- Resist the urge to sign a contract with a private lender. Decide which loan and interest rates are ideal for you after shopping around. Keep in mind that the loan may have a significant influence on your financial condition after graduation.
- Make sure to do your homework before taking out a direct-to-consumer, or uncertified, loan to determine what you need to be investing your funds in. Even if the money is sent directly to you, it doesn’t imply you may use it in whatever you choose. Spend the cash only on needs associated with school, such as textbooks. Take out no more than you need. You must pay back the money plus interest, accumulating over time to a sizable sum.
