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?

If you are enrolled or accepted for enrollment in a degree seeking program at least half-time in a U.S. college, university or other eligible postsecondary institution, you may be eligible for an Alternative Loan.

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.

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.

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.

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

No. 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 one disbursement shortly after the beginning date of the semester.

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. Contact the lender to obtain a pre-approval or denial by phone or on-line.
  3. The lender will send SF State an electronic notice of your pre-approval or denial.
  4. Your lender will send you a pre-printed Application/Promissory Note, and a Private Education Loan Applicant Self-Certification Form.
  5. SF State will electronically certify your eligibility for the pre-approved loan.
  6. Your lender will send the funds to SF State.
  7. SF State will release the funds once requirements for student enrollment are confirmed. Most Alternative lenders will electronically transfer funds to SF State. If the student has no outstanding financial obligations to SF State, the university mails a check directly to the student or initiates a direct deposit. If the student owes money to SF State, the university deducts all obligations and forwards a balance check to the student or initiates a direct deposit.

Process to apply from list of Alternative Loan Lenders

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