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Private Loan Repayment

  • The interest rates on private loans are variable and are adjusted quarterly.
  • Grace period may be 6-9 months.
  • No deferment option, but forbearance granted at the lender´s discretion.  Contact your lender/servicer to request a forbearance.
  • During forbearance, accrued interest will be capitalized, i.e., added to principal, which can be costly.
  • Repayment term: 15 to 25 years depending on the amount borrowed.
  • There is no prepayment penalty.
  • Generally, private loans are more expensive because of the variable interest rate and should be paid down first.
  • Not forgiven in the event of death or disability.
  • May not be consolidated into a Federal Direct Consolidation Loan.