How to get a student loan in 5 steps

Learning how to get a student loan can be overwhelming if you’ve never done it before. You will need to research different types of loans, review eligibility criteria, and determine how much to borrow. From there, you will submit an application and wait for the loan disbursement.

Here’s how each step of the process works, so you know with confidence how to get a federal or private student loan.

1. Research different types of loans

Before you ask yourself how to get a student loan, it’s important to understand the different types of loans you may be eligible for. There are federal student loans, which are offered by the Department of Education, and private student loans, which are issued by private organizations like banks, credit unions, and online lenders.

For many borrowers, federal student loans may offer lower rates. Plus, they come with additional protections for borrowers, such as income-driven repayment plans, forgiveness options, and more lenient hardship programs.

Within the federal student debt category, there are four types of loans borrowers can consider:

• Subsidized direct loans: These loans are available to undergraduate students who have demonstrated financial need. The government pays accrued interest when you are not in active repayment.
• Direct unsubsidized loans: Open to undergraduate students as well as graduate and professional students, these loans are not based on financial need.
• Direct PLUS Loans: This funding is available to graduate and professional students, in addition to parents of dependent undergraduate students. This is the only type of federal loan that requires a credit check, although borrowers who do not meet credit standards may still qualify after taking further steps.
• Direct Consolidation Loans: These loans allow borrowers to combine existing federal debt into a new loan with a single servicer.

2. Check your eligibility

Next, you will need to determine if you qualify for student loans. The criteria vary depending on whether you are applying for federal or private debt.

For federal student loans, applicants generally must:

• Be a US citizen or eligible non-citizen
• Have a valid social security number
• Be accepted or enrolled at least half-time in an eligible degree or certificate program
• Maintain satisfactory academic progress, as determined by your school
• Have a high school diploma or its equivalent
• Demonstrate financial need (only applies to certain types of federal funding)

In the meantime, here are the requirements that generally apply to private student loans:

• Be a US citizen or eligible non-citizen
• Be enrolled in a qualifying degree or certificate program, often at least half-time
• Be at least the age of majority in your state (usually 18)
• Have a high school diploma or its equivalent
• Have a good credit score, usually above 670
• Meet income and debt-to-income ratio requirements

If you can’t qualify for a private loan on your own, adding a co-signer to your application can help.

3. Determine how much you need

You will also need to determine how much you need to pay for your education. As a general rule, you should only borrow the minimum amount necessary to cover tuition, fees, and necessities, even if you are eligible to borrow more.

“[Students] should consider not only what they need to borrow to cover university expenses, but also what they can afford to repay once they are out of school,” said Jill Desjean, senior analyst policies at the National Association of Student Financial Aid Administrators.

The Department of Education’s College Scorecard database offers information on median earnings by major for each college that offers federal student aid — this can help estimate your future earning potential.

Also be sure to consider any scholarships or grants you receive, as this can help reduce what you borrow. “Students should be sure to take advantage of all sources of help before borrowing student loans,” Desjean said.

Additionally, you may find that your borrowing capacity is capped by loan limits. Federal limits vary depending on your year of study and whether you are a dependent or independent borrower, but generally range from $5,500 to $12,500 per year for undergraduates.

Private debt often has higher limits. “Private loans are generally limited only by the cost of attending the school the student attends, but limits vary by lender,” Desjean said.

4. Submit an application

Once you’ve done the necessary research, it’s time to submit your student loan application. The exact process varies by loan type.

How to Get a Federal Student Loan

To apply for federal student aid, submit the Free Application for Federal Student Aid (FAFSA) form annually.

To do this, create a Federal Student Aid ID before you start applying on FAFSA.gov. You must provide a series of information, including detailed personal and financial data. If you are a dependent student (most undergraduates are), a parent must also submit their own information.

Don’t wait too long to begin this process — “students should complete the FAFSA as soon as possible,” Desjean suggested, as some aid is awarded on a first-come, first-served basis. The most recent FAFSA is usually released on October 1 each year.

Based on the information you provide in your FAFSA, your school will outline your financial aid offerings, which may include federal student loans, scholarships, and work-study opportunities.

How to get a private student loan

If you are interested in private student loans, start by researching and comparing lenders. Once you’ve figured out which ones might give you the best deal, you can fill out an application.

You will usually need to provide your contact and personal information, along with details of the school you are attending, your expected graduation date, the cost of attendance, and the loan amount requested. You can also view a general information document, which will provide examples of sample loan repayment plans and interest rates.

The approval process often involves a rigorous credit check, which can temporarily affect your credit score. Additionally, lenders will review other information you have provided to determine if you are eligible.

Decisions about private student loans often come quite quickly. Some lenders may offer a same-day decision, while others may take several days to get back to you.

Related: Learn more about get a private student loan

5. Finalize loan and wait for disbursement

For federal student loans, you’ll let your school know what aid you want to accept and how much you want to borrow. If this is your first time getting a federal loan, you’ll also go through an entry board, which reviews the rules and terms of the loans, before signing a principal promissory note to agree to the terms.

When you borrow from a private lender, you will also need to review the terms of your loan and sign the final documents. From there, you will wait for your school to certify your loan, which usually takes a minimum of seven to 10 days; if any details change during this process, you may need to sign a new declaration.

Money from private or federal loans is usually sent directly to your school. The financial aid office will apply the funds to your outstanding fees before the remaining money is sent to you.

What to consider before borrowing

Student loans allow many students to afford higher education, but you will have to pay that money back one day. Consider other financing options before turning to loans and work out a future payment plan.

Keep the following suggestions in mind before borrowing:

• Exhaust all grants and scholarships first, as they usually do not need to be repaid.
• Look beyond your college for private scholarship opportunities.
• Consider your future earning potential when determining how much you can safely borrow.
• Consider tapping into your savings to cover tuition, rather than relying entirely on loans.
• Consider paying interest only on your loan while in school to minimize later costs.

Related: Learn more about get a private student loan