How to Pay for an Online College in 4 Steps

Andrew Pentis
February 24, 2021August 24, 2022Paying for CollegeFeatured, Student Loans1037Andrew PentisAmanda GarciaSEO
Updated on  February 24, 2021
How Student Loan Hero Gets Paid

How Student Loan Hero Gets Paid

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Student Loan Hero Advertiser Disclosure

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Private Student Loan rates starting at 2.49% APR

2.49% to 13.85% 1
VARIABLE APR

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2.55% to 11.44% 2
VARIABLE APR

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3.25% to 13.59% 3
VARIABLE APR

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1Important Disclosures for College Ave.

College Ave Disclosures

College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC.. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.

  1. As certified by your school and less any other financial aid you might receive. Minimum $1,000.
     
  2. Rates shown are for the College Ave Undergraduate Loan product and include autopay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
     
  3. This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with a 10-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 8.35% fixed Annual Percentage Rate (“APR”): 120 monthly payments of $179.18 while in the repayment period, for a total amount of payments of $21,501.54. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.

Information advertised valid as of 9/15/2022. Variable interest rates may increase after consummation. Approved interest rate will depend on the creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.



2Rate range above includes optional 0.25% Auto Pay discount. Important Disclosures for Earnest.

Earnest Disclosures

Actual rate and available repayment terms will vary based on your income. Fixed rates range from 3.47% APR to 13.03% APR (excludes 0.25% Auto Pay discount). Variable rates range from 2.80% APR to 11.69% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. Although the rate will vary after you are approved, it will never exceed 36% (the maximum allowable for this loan). Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.



3Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.

  • Variable APR
Learn more about private student loan lenders.

Note that the government has paused all repayment on federally held student loans through the end of 2022, with no interest to be charged during that period and no loans to be held delinquent or in default.

*          *          *

If your online college is eligible for federal aid, you might be able to get federal student loans for online classes. If it’s not, you may still be able to access private student loans.

But before borrowing money for school, make sure to apply for grants, scholarships and other aid that you generally don’t have to pay back.

How to get student loans for online classes

If you need additional funding, here’s how to go about getting student loans for online classes:

  1. Determine if your school is eligible for federal financial aid
  2. Find out if your program is accredited
  3. Compare federal and private student loans for online college
  4. Examine other options if school accreditation is an issue

1. Determine if your school is eligible for federal financial aid

If you want to access federal financial aid (including student loans) for an online college, your school must be accredited by a federally recognized accrediting agency. The good news is there are plenty of accredited online colleges that can set you up with federal student loans and financial aid.

For example, about 75% of students at online-only Capella University received financial aid as of Dec. 31, 2019, including federal grants, work-study opportunities and loans. Many more traditional schools, including public nonprofit giant Arizona State University, offer fully online degrees.

Find out if your school is eligible by using the Department of Education’s Federal School Code Search tool. You can find your school’s code by asking its financial aid office or doing a search — with “[school name] federal school code” — online.

The Federal Student Aid office also maintains a downloadable spreadsheet of school codes.

2. Find out if your program is accredited

Go a step further to determine if your degree path would also be accredited. You can type your school’s name into the Department of Education’s Database of Accredited Postsecondary Institutions and Programs. You might find, for example, that your school’s nursing department enjoys full accreditation, while its program for teachers has lost its backing.

Use the federal agency’s tools instead of relying solely on your school. A school might tell you that it enjoys the support of an accrediting organization — but that organization could be dubious. You also can cross-check your school’s accreditation claims using the Council for Higher Education Accreditation’s list of legitimate accreditation organizations.

Confirm your findings with the school’s financial aid office. Then, complete the Free Application for Federal Student Aid (FAFSA) — the FAFSA will determine the amount and kind of federal aid you’ll be eligible to receive, including student loans.

Depending on your Expected Family Contribution (soon to be renamed the Student Aid Index), you might be eligible for direct subsidized loans, a specific kind of federal student loan. With these loans, the government pays interest on the debt while you’re enrolled and during the first six months after you graduate, so it’s better than direct unsubsidized loans.

Federal aid can also be available in the form of grants and work-study opportunities, if your family demonstrates financial need.

3. Compare federal and private student loans for online college

Whether you’re an online or on-campus student makes no difference in the world of federal student loans. The interest rates, repayment terms and other details are the same for each type of loan.

The federal government should usually be your first stop for borrowing, since its student loans come with low interest rates and flexible repayment plans. What’s more, federal loans are eligible for various loan forgiveness programs.

However, some private student loan companies offer certain borrower protections, such as the ability to defer repayment while you’re in school or if you lose your job. And if you have strong credit or can apply with a creditworthy cosigner, you could find competitive rates on a private student loan.

There is, however, another key nuance of student loans for online college: Just because your school is eligible for federal loans doesn’t mean that it will be eligible to work with every private lender.

You can check with lenders directly if you don’t see your school as an option on your initial loan application. Then, use our student loan payment calculator to figure out the amount of interest you’ll be responsible for during your loan term.

No matter what type of loan you use, borrow only what you need after applying for gift aid like grants and scholarships. Gift aid doesn’t have to be paid back, unlike federal student loans.

4. Examine other options if school accreditation is an issue

You could run into trouble when financing your education if you opt for an online college without accreditation. Speak with the school’s financial aid office about your options — as well as asking why it doesn’t enjoy the accreditation of a legitimate accrediting body.

Often, for-profit colleges (online and on-campus) might not have the proper accreditation, so you can’t finance your degree with federal loans.

If you’re seeking a certificate for a specific trade and not for an associate or bachelor’s degree, your school might not be accredited. However, there are ways to find student loans for trade programs.

At the same time, even if you can find a reputable lender for your program, you’d be wise to question the school for not being accredited. Schools that enjoy accreditation offer more student loan options. More importantly, they could also be better suited at preparing you for a career.

At the end of the day, attending an online college could be a big money-saver, especially if you don’t have to pay for on-campus room and board.

Paying for school will come with challenges, whether your classroom is virtual or not. When you’re on the lookout for student loans for online classes, start by examining your school’s accreditation. That’ll help you figure out if it’s eligible for federal and private student loan options.

Rebecca Safier contributed to this report.

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How Student Loan Hero Gets Paid

How Student Loan Hero Gets Paid

Student Loan Hero is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). Student Loan Hero does not include all lenders, savings products, or loan options available in the marketplace.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Student Loan Hero is an advertising-supported comparison service. The site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

How Student Loan Hero Gets Paid

How Student Loan Hero Gets Paid

Student Loan Hero is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). Student Loan Hero does not include all lenders, savings products, or loan options available in the marketplace.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Student Loan Hero is an advertising-supported comparison service. The site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Variable APRDegrees That QualifyMore Info
2.49% – 13.85%1 Undergraduate
Graduate

Visit College Ave

2.55% – 11.44%2 Undergraduate
Graduate

Visit Earnest

3.25% – 13.59%3 Undergraduate
Graduate

Visit SallieMae

0.00% – 23.00%4 Undergraduate
Graduate

Visit Edly

3.25% – 9.69%5 Undergraduate
Graduate

VISIT CITIZENS

N/A 6 Undergraduate
Graduate

Visit FundingU

Learn more about private student loan lenders.
Learn more about private student loan lenders.
1Important Disclosures for College Ave.

College Ave Disclosures

College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC.. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.

  1. As certified by your school and less any other financial aid you might receive. Minimum $1,000.
     
  2. Rates shown are for the College Ave Undergraduate Loan product and include autopay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
     
  3. This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with a 10-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 8.35% fixed Annual Percentage Rate (“APR”): 120 monthly payments of $179.18 while in the repayment period, for a total amount of payments of $21,501.54. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.

Information advertised valid as of 9/15/2022. Variable interest rates may increase after consummation. Approved interest rate will depend on the creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.



2Rate range above includes optional 0.25% Auto Pay discount. Important Disclosures for Earnest.

Earnest Disclosures

Actual rate and available repayment terms will vary based on your income. Fixed rates range from 3.47% APR to 13.03% APR (excludes 0.25% Auto Pay discount). Variable rates range from 2.80% APR to 11.69% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. Although the rate will vary after you are approved, it will never exceed 36% (the maximum allowable for this loan). Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.



3Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.

4Important Disclosures for Edly.

Edly Disclosures

1. Loan Example:

  • Loans from $5,000 – $20,000
  • Example: $10,000 IBR Loan with a 7% gross income payment percentage for a Senior student making $65,000 annually throughout the life of the loan.
    • Payments deferred for the first 12 months during final year of education.
    • After which, $270 Monthly payment for 12 months.
    • Then $379 Monthly payment for 44 months.
    • Followed by one final payment of $137 for a total of $20,610 paid over the life of the loan.

About this example

The initial payment schedule is set upon receiving final terms and upon confirmation by your school of the loan amount. You may repay this loan at any time by paying an effective APR of 23%. The maximum amount you will pay is $22,500 (not including Late Fees and Returned Check Fees, if any). The maximum number of regularly scheduled payments you will make is 60. You will not pay more than 23% APR. No payment is required if your gross earned income is below $30,000 annually or if you lose your job and cannot find employment.

2. Edly Student IBR Loans are unsecured personal student loans issued by FinWise Bank, a Utah chartered commercial bank, member FDIC. All loans are subject to eligibility criteria and review of creditworthiness and history. Terms and conditions apply.



5Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  • Variable Rate Disclosure: Variable interest rates are based on the 30-day average Secured Overnight Financing Rate (“SOFR”) index, as published by the Federal Reserve Bank of New York. As of September 1, 2022, the 30-day average SOFR index is 2.23%. Variable interest rates will fluctuate over the term of the loan with changes in the SOFR index, and will vary based on applicable terms, level of degree and presence of a co-signer. The maximum variable interest rate is the greater of 21.00% or the prime rate plus 9.00%.
  • Fixed Rate Disclosure: Fixed rate ranges are based on applicable terms, level of degree, and presence of a co-signer.
  • Lowest Rate Disclosure: Lowest rates are only available for the most creditworthy applicants, require a 5-year repayment term, immediate repayment, a graduate or medical degree (where applicable), and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Rates are subject to additional terms and conditions, and are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.

     

    Undergraduate Rate Disclosure: Variable interest rates range from 3.25%-10.35% (3.25% – 9.69% APR). Fixed interest rates range from 4.24% – 10.59% (4.24% – 9.93% APR). 

    Graduate Rate Disclosure: Variable interest rates range from 3.75%-9.90% (3.75% – 9.68% APR). Fixed interest rates range from  5.22% – 10.14% (5.22% – 9.91% APR). 

    Business/Law Rate Disclosure: Variable interest rates range from 3.75%-9.35% (3.75% – 9.16% APR). Fixed interest rates range from 5.20% – 9.59% (5.20% – 9.39% APR).

    Medical/Dental Rate Disclosure: Variable interest rates range from 3.75%-9.02% (3.75% -8.98% APR). Fixed interest rates range from 5.18% – 9.26% (5.18% – 9.22% APR). 

    Parent Loan Rate Disclosure: Variable interest rates range from 3.25%-9.21% (3.25% – 9.21% APR). Fixed interest rates range from 3.96%-9.50% (3.96%-9.50% APR).

    Bar Study Rate Disclosure: Variable interest rates range from 6.58%-11.72% (6.58% – 11.62% APR). Fixed interest rates range from 7.39% – 12.94% (7.40% – 12.82% APR). 

    Medical Residency Rate Disclosure: Variable interest rates range from 5.67%-9.17% (5.67% – 8.76% APR). Fixed interest rates range from 6.99% – 10.49% (6.97% – 10.08% APR).



6Important Disclosures for FundingU.

FundingU Disclosures

Offered terms are subject to change. Loans are made by Funding University which is a for-profit enterprise. Funding University is not affiliated with the school you are attending or any other learning institution. None of the information contained in Funding University’s website constitutes a recommendation, solicitation or offer by Funding University or its affiliates to buy or sell any securities or other financial instruments or other assets or provide any investment advice or service.