Lenders Offering Private Loans for Part-Time College Students

 September 9, 2020
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Attending college part-time could give you the flexibility to work a job, care for your children or save on school tuition.

Being a part-timer, however, limits your access to private student loans.

Here’s a look at how your enrollment status affects your aid, plus where to find private loans when you need them.

How your enrollment status affects your financial aid

If you’re attending school at least half-time, it’s generally recommended to lean on federal student loans first. They don’t require strong credit or a cosigner, and they come with exclusive protections like income-driven repayment and the potential for student loan forgiveness.

But your options are more limited if you’re only taking classes here and there.

To borrow Direct Subsidized and Unsubsidized Loans from the federal government, for example, you must attend school at least half-time. This is based on your course load, with your school likely setting a certain number of credit hours per week to be considered “full-time” status.

The same goes for Parent PLUS Loans if your mom or dad is considering borrowing on your behalf — you’d still need to attend school half-time or more.

A private loan could help you finance your cost of attendance, but not all banks, credit unions or online lenders work with part-time students. Those that do will usually look at your credit score, credit history and debt-to-income ratio — or your cosigner’s — before offering their stamp of approval.

Some lenders offering private loans for part-time college students

Many private lenders, such as Ascent and Citizens Bank, follow in the federal government’s footsteps and require you to be enrolled at least half-time.

The following three lenders, however, allow you to dip below half-time and still qualify for borrowing.

1. College Ave Student Loans

  • Fixed and variable interest rates
  • Borrow as little as $1,000
  • Four in-school repayment options, including deferment
  • Repayment term options include 5, 8, 10 and 15 years
  • Receive a 0.25% rate deduction for enrolling in autopay
  • No application fees
  • Prequalify in three minutes
  • Release your cosigner after completing half of your repayment

Eligibility fine print: You must be seeking a degree from an eligible school. If you don’t see your school listed when applying for a loan, it’s likely ineligible. Confirm by contacting your school or emailing the lender at [email protected]

2. Sallie Mae

  • Fixed and variable interest rates
  • Borrow as little as $1,000
  • Three in-school repayment options, including deferment
  • Repayment term options span 5 to 15 years
  • Receive a 0.25% rate deduction for enrolling in autopay
  • No origination or prepayment fees
  • Apply in 15 minutes
  • Receive free credit-score tracking and academic study support
  • Request 12 months of interest-only payments after graduation
  • Release your cosigner after industry-best 12 months of prompt payments

Eligibility fine print: You must be seeking a bachelor’s or associate’s degree or a certificate from a participating school.

3. Rhode Island Student Loan Authority

  • Fixed and variable interest rates
  • Borrow as little as $1,500 per year
  • Defer payments until six months after finishing school
  • Repayment term options include 5, 10 and 15 years
  • Receive a 0.25% rate deduction for enrolling in autopay
  • No application or origination fees
  • Prequalify in 10 minutes or less
  • Possible access to federal loan-like features forgiveness and Income-Based Repayment
  • Receive multi-year approval with one application
  • Release your cosigner after 24 consecutive months of prompt payments

Eligibility fine print: Only Rhode Island residents or students can borrow fixed-rate loans, although any student nationally — of any enrollment type — is eligible to borrow a variable-rate loan.

3 catches of part-time students borrowing for college

As you consider borrowing a private student loan for your part-time enrollment, keep these issues in mind:

1. School certification

Your school must certify your enrollment status with a lender before you can receive a loan. If the school doesn’t allow part-time students — or private loans for part-timers — you would have wasted your time applying for aid in the first place.

To avoid headaches, check in with your campus financial aid office to learn about its enrollment requirements before you borrow. You might be asked to complete a self-certification form, confirming the amount you’re eligible to borrow.

2. Minimum borrowing amount

As a less-than-half-time student, you probably don’t need to borrow as much money for school as your full-time peers. At many schools, the fewer credits you sign up for, the lower your cost of attendance is.

To be eligible for a private loan, however, you must borrow a minimum amount. College Ave and Sallie Mae, for example, all set a $1,000 threshold. If you need to borrow less than that, you might be able to avoid borrowing by taking on a part-time job.

3. Triggering repayment

If you drop below half-time enrollment after borrowing private student loans, you could be expected to begin repaying those loans immediately. Contact your lender (preferably before you change your enrollment status) to learn about any consequences.

Similarly, if you drop credits from your course load and fall below half-time, you’ll be expected to enter repayment on your federal loans.

Consider all of your financial aid options

Only a handful of reputable lenders allow part-time students to borrow for college. With fewer options than your half- and full-time peers, ensure borrowing is best for you before signing on the dotted line.

Explore all of your financial aid options for part-timers. And, if you haven’t already, apply for gift aid that doesn’t need to be repaid, including grants and scholarships.

Need a student loan?

Here are our top student loan lenders of 2022!
LenderVariable APREligibility 
2.49% – 13.85%1Undergraduate
Graduate

Visit College Ave

2.55% – 11.44%2Undergraduate
Graduate

Visit Earnest

3.25% – 13.59%3Undergraduate
Graduate

Visit SallieMae

0.00% – 23.00%4Undergraduate
Graduate

Visit Edly

3.25% – 9.69%6Undergraduate
Graduate

VISIT CITIZENS

N/A6Undergraduate
Graduate

Visit FundingU

* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.

1 Important Disclosures for College Ave.

CollegeAve 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.


2 Rate 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.


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

4 Important 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.


5 Important 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).


6 Important Disclosures for Funding U.

Funding U 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.