Office of Student Financial Aid

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Alternative Loan Program

What is an Alternative Loan?

Alternative Loans are offered by banks or lending institutions to assist students in bridging the gap between college costs and traditional funding sources. These loans are private supplemental loans and are not guaranteed by the federal government. Terms and conditions of these loans can vary according to specific lender guidelines.
Additionally, we adhere to the California State University Student Lending - Code of Conduct (Higher Education Opportunity Act Disclosures).

Am I eligible for an Alternative Loan?

Alternative loans are credit based, therefore your creditworthiness will be evaluated by the lender you choose. You must be enrolled in a degree seeking program at San Francisco State University. We do not certify loans for students taking courses through Open University/College of Extended Learning. You can contact College Of Extended Learning to see what options are available to you.

Is there a Unit requirement for Alternative Loans?

Yes. Unless you are graduating the semester you will be receiving the loan, you are required to be in at least half-time units.

Do I need to complete the FAFSA in order to apply for the Alternative Loan?

No. You are not required to complete this free government application at , but it is a good idea to explore all federal and state financial aid options first, prior to applying for an Alternative Loan.

What if completed the FAFSA and am no longer interested?

If you completed a FAFSA and have been awarded, please accept/decline your award so that your alternative loan amount is correctly certified. If you do not accept/decline your federal aid, this may delay the processing of your alternative loa. If you have been selected for verification and do not wish to proceed with the verification process, please email:, include your student id number and state in the email that you do not wish to complete the process.

Do I make too much money to qualify for the Alternative Loan?

No. Unlike other types of financial aid, the Alternative Loan is not need based. However, you cannot borrow more than the cost of attendance, minus other financial aid received.

How much money am I eligible to borrow?

Unlike other types of financial aid, the Alternative Loan is not need based. The maximum eligibility is determined by the Cost of Attendance minus any financial aid that the student has been awarded. In some cases, the Alternative Loan can replace all or a portion of the expected resources. If the student will not be receiving financial aid of any kind, the student can borrow the full cost of attendance. Please refer to your Offer of Financial Aid for the amount of Alternative Loan that you are eligible to borrow.

*you may only borrow loans by school year (Fall/Spring) or semester (Fall OR Spring). Summer is a separate semester.*

Have you accepted your maximum amount of Direct Loans?

If you completed a FAFSA you may be eligible for a subsidized loan (no interest) and an unsubsidized loan (low interest). It is beneficial to accept the maximum amount of these loans because they sometimes have a lower interest rate than alternative loans.

Is there a benefit to submitting the Alternative Loan Application and Promissory note to my lender early?

In many cases, yes. Many students simply want the peace of mind knowing that they have been preapproved early in the process. Also, students may have credit issues that must be resolved before final approval. Keep in mind your loan must be disbursed within 180 days from the date the loan was approved, so if you apply too early, you may have to reapply.

Do I need to know the amount that I want to borrow before I apply for preapproval?

It would be beneficial to know that amount before applying so that you know the accurate amount and can budget accordingly. However, the school will determine the maximum amount you are allowed for an Alternative Loan. If you requested an amount that is too high, the school will automatically reduce your requested amount to the maximum amount allowed. This amount is calculated by subtracting any grants, aid, scholarships, Federal Direct Student Loans and/or other loans awarded to you from the total cost of attendance.

Can I find out in advance if my credit check will be approved?

Yes. Most Alternative lenders offer credit preapproval to all students at no cost.

Am I required to take an Alternative Loan upon application?

No. Approval for an Alternative Loan does not commit you to taking out the loan. If approved, you may contact your lender at any time before disbursement to cancel or reduce the loan request.

How will I receive my Alternative Loan funds?

The Alternative Loan is disbursed directly to the school. If the loan is a full year loan, the student will receive one disbursement during the Fall semester and one disbursement during the Spring semester. If the loan is a one-semester loan, the student will receive only one disbursement the semester chosen.

How long will the process take?

Once the lender sends over the certification to the school, the school will certify the loan within 48-72 hours. After the loan is certified there is a 10 day Right To Cancel period as indicated on your loan documents, once the period has ended, the school will receive the funds (always on Fridays) and will then disburse the loans on Wednesday's. It is beneficial for you to sign up for direct deposit so that you may receive your funds within 2-5 days from the date of disbursement.

What if I decide I no longer want to attend SF State?

You must contact us via email so that we can cancel the loan and send the funds back. It can take the lender 3-5 weeks for their system to be updated to show that the loan has been cancelled. If you do not notify our office to inform us that you will not be attending, you will be responsible for any interest fees incurred.

Factors to keep in mind when choosing a lender:

  1. Evaluate potential lenders:
    - customer service; stability of lender; if loans are held by lender or sold; borrower benefits; on-line lender services; repayment options; security; debt management options; and additional services.
  2. Compare interest rates, is it a fixed rate or variable?
  3. Look at the loan terms, is there a grace period?
  4. Are there any additional fees that are associated with

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