Ultimate Guide to Student Loans

Federal student loans are loans provided by the U.S. government to help students pay for their education. They are available to students regardless of income and have flexible repayment options, including income-driven repayment plans. Some of the most common types of federal student loans include Direct Subsidized Loans, Direct Unsubsidized Loans, Parent PLUS Loans, and Grad PLUS Loans. 

In general, you should exhaust all other forms of financial aid, such as scholarships, grants, and work-study, before borrowing federal student loans.

More: The ultimate guide to federal student loans.

Private student loans are provided by private lenders, such as banks, credit unions, and state agencies. These loans are typically used to fill the gap between the cost of attendance and other forms of financial aid received, such as scholarships, grants, and federal student loans. Private student loans usually require an income and credit check.

In general, you should borrow federal student loans before borrowing private student loans, which may have fewer repayment options and borrower protections than federal loans.

More: The ultimate guide to private student loans.

Student loan refinancing is when a private lender pays off your current loan(s) and issues a new loan with more favorable terms, such as a lower interest rate or shorter repayment plan. It’s essentially an opportunity to exchange your existing loan for a better one. The primary objective of refinancing is often to decrease the your monthly payment, interest rate, or both.

Refinancing allows you to merge multiple loans into a single one, and the new loan may offer more advantageous terms than the original loans. However, if you refinance federal student loans with a private lender, certain federal student loan benefits, such as income-driven repayment plans and loan forgiveness options, may be forfeited.

More: The ultimate guide to student loan refinancing.

Direct Subsidized Loans are a type of federal student loan designed to help undergraduate students with financial need pay for college expenses.

Direct Subsidized Loans are unique in that the government pays the interest on the loan while you are in school at least half-time, during the grace period, and during any deferment periods. This makes Direct Subsidized Loans an affordable option, as they will accrue less interest over time compared to other types of student loans.

More: The difference between subsidized and unsubsidized loans.

Direct Unsubsidized Loans are a type of federal student loan available to undergraduate and graduate students, regardless of financial need.

Unlike Direct Subsidized Loans, the government does not pay the interest on Direct Unsubsidized Loans while you are is in school or during deferment periods. You are responsible for paying the interest that accrues on the loan. You can choose to pay the interest as it accrues, or you can allow it to accumulate and be capitalized (added to the loan balance), increasing the total amount to be repaid.

More: The difference between subsidized and unsubsidized loans.

Parent PLUS Loans are a type of federal student loan designed to help parents pay for their children’s undergraduate education, regardless of the family’s financial need. Parent PLUS Loans are available to undergraduate students who have exhausted their federal student loan eligibility under other loan programs, such as Direct Subsidized and Unsubsidized Loans.

Compared to Direct Subsidized and Unsubsidized Loans, Parent PLUS Loans have higher interest rates and less flexible repayment options. Parent Plus Loans also have higher borrowing limits — parents can borrow the full cost of attendance, minus any other financial aid received.

More: Everything you need to know about Parent PLUS loans.

Grad PLUS Loans are a type of federal student loan designed to help graduate and professional students pay for their education. Grad PLUS Loans are available to graduate and professional students who have exhausted their federal student loan eligibility under other loan programs.

Compared to Direct Subsidized and Unsubsidized Loans, Grad PLUS Loans have higher interest rates and less flexible repayment options. Grad Plus Loans also have higher borrowing limits — you can borrow the full cost of attendance, minus any other financial aid received.

More: Everything you need to know about Grad PLUS loans.

Perkins Loans are a type of federal student loan, specifically for undergraduate and graduate students with exceptional financial need. These loans are provided by the school and have a low interest rate, with a maximum amount that can be borrowed annually based on the student’s financial need, cost of attendance, and other financial aid received. Perkins Loans also offer loan cancellation benefits for certain professions such as teachers and public servants.

The authority for schools to make new Federal Perkins Loans ended on Sept. 30, 2017.

An undergraduate private student loan is a type of loan that is offered by private lenders, such as banks or financial institutions, to help students pay for their college education after exhausting all other federal aid. These loans typically have different interest rates, repayment terms, and requirements than federal student loans, and often require a credit check and a cosigner.

More: Best private student loans for undergraduate students.

A graduate private student loan is a type of loan that is specifically designed for students pursuing a graduate or professional degree, such as a master’s or doctorate. These loans are offered by private lenders, such as banks or financial institutions, and typically have different interest rates, repayment terms, and requirements than federal student loans, and may require a credit check and a cosigner.

More: Best private student loans for graduate students.

Students who aren’t United States citizens generally won’t qualify for federal student loans (unless you’re an eligible noncitizen). An international private student loan is a type of loan offered by private lenders to help international students pay for their education in the United States. These loans typically have different requirements and terms than loans for domestic students, and may require a creditworthy cosigner or additional documentation to be eligible.

More: Best private student loans for international students.

Most federal student loans do not require a credit check, which makes them an attractive option for most students. If you require additional funding for your education, there are a few private lenders who provide loans specifically to borrowers with poor credit. These lenders will determine your eligibility based on additional factors such as where you go to school, what you’re studying, and your earning potential.

More: Best private student loans for students with bad credit.

The majority of undergraduate private student loans — over 90% — have a cosigner. A cosigner can help you get approved for a loan and get a lower interest rate. But if you don’t have a cosigner, don’t worry. There are a few lenders that assess your eligibility according to factors beyond credit history, making it more likely you’ll qualify on your own.

More: Best private student loans for students without a cosigner.

A parent loan is a loan for parents, guardians, or sponsors to help cover the cost of a student’s education. It differs from a cosigned loan because only the parent (not the student) is responsible for paying it back.

Parent loans tend to have higher interest rates than traditional student loans. However, parent loans can also come with higher borrowing limits, which could come in handy if the student is attending an expensive school and needs more financial aid than the US government offers. Parents with a strong financial profile (high income and strong credit score) may be able to qualify for an interest rate that’s lower than a federal Parent PLUS loan by cosigning a private loan or taking out a private parent loan.

More: Best parent loans.

Medical student loans are a type of loan specifically designed for students who are pursuing a career in medicine, such as becoming a doctor, nurse, or other healthcare professional. Medical students with good credit may be able to get a lower interest rates through private student loans rather than federal loans.

But, if you work at a nonprofit hospital after graduation, you won’t be able to get your private student loan forgiven. With a federal student loan, you would be eligible for loan forgiveness through through the federal Public Service Loan Forgiveness (PSLF) program.

More: Best student loans for medical school.

Law school student loans are loans designed specifically to help law students pay for their education. These loans are offered by private lenders and typically have variable or fixed interest rates, as well as different repayment options than federal student loans. To qualify for a private law school student loan, the borrower typically needs to have a strong credit history or a cosigner with good credit.

More: Best student loans for law school.

Dental school student loans are loans designed specifically to help dental students pay for their education. Dental students may also consider alternative financing options such as scholarships, grants, and work-study programs to help pay for their education.

More: Best student loans for dental school.

Federal student loan refinancing is when a private lender pays off your existing federal loans and offers you a new loan with better terms. In order to refinance, you typically need a high credit score (690 or higher) and strong income.

Note: If you refinance federal student loans, you lose access to federal loan benefits such as income-driven repayment plans, loan forgiveness programs, and forbearance options.

More: Pros and cons of refinancing federal student loans.

Private student loan refinancing is when a private lender pays off your existing private loans and offers you a new loan with better terms. To be eligible for refinancing, a high credit score (690 or above) and stable income are usually required.

Unlike refinancing federal student loans (which causes you to lose of federal student loan benefits), there is no downside to refinancing private student loans. Refinancing private student loans is a great way to:

1.) Get a lower monthly payment, freeing up cash for other expenses.

2.) Pay off your loan faster, saving you money in interest.

3.) Lower your monthly payment in order to decrease your debt-to-income ratio, which can make it easier to qualify for a mortgage or other large purchase.

More: Best student loan refinance rates.

Medical student loan refinancing is available during and after residency. Some lenders have student loan refinancing programs specifically for medical residents, which could make your monthly payment or interest rate cheaper.

Note: If you refinance federal student loans, you lose access to federal loan benefits such as income-driven repayment plans, loan forgiveness programs, and forbearance options.

More: A complete guide to refinancing medical school loans.

Direct Subsidized Loans are available to undergraduate students who have financial need.

To apply for a Direct Loan, you must first complete and submit the Free Application for Federal Student Aid (FAFSA) form.

Your school determines the amount you can borrow. There are limits on the amount in subsidized and unsubsidized loans that you may be eligible to receive each academic year (annual loan limits) and the total amounts that you may borrow for undergraduate and graduate study (aggregate loan limits).

More: Student loan limits: how much can you borrow in student loans?

Repayment options for Direct Subsidized Loans include the following:

1.) Standard Repayment Plan: A fixed monthly payment for up to 10 years.

2.) Graduated Repayment Plan: Payments start low and increase every two years, up to 10 years.

3.) Extended Repayment Plan: Fixed or graduated payments over a period of up to 25 years.

4.) Income-Based Repayment (IBR) Plan: Monthly payments are based on income and family size, and the loan is forgiven after 20-25 years of payments.

5.) Pay As You Earn (PAYE) Plan: Monthly payments are based on income and family size, and the loan is forgiven after 20 years of payments.

6.) Revised Pay As You Earn (REPAYE) Plan: Monthly payments are based on income, regardless of family size, and the loan is forgiven after 20-25 years of payments.

Borrowers should consider their income and financial goals when selecting a repayment plan, and should also keep in mind that some plans may result in paying more interest over time compared to others. It is also possible to switch repayment plans if necessary.

More: How to select the best federal student loan repayment option.

The interest rates for Direct Subsidized Loans first disbursed on or after July 1, 2022 and before July 1, 2023 are:

– Undergraduate borrowers: 4.99%

– Graduate or professional borrowers: N/A

The U.S. Department of Education pays the interest on a Direct Subsidized Loan:

1.) while you’re in school at least half-time,

2.) for the first six months after you leave school (referred to as a grace period), and

3.) during a period of deferment (a postponement of loan payments).

Yes, there is a loan fee on all Direct Subsidized Loans and Direct Unsubsidized Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed:

– Loans first disbursed on or after Oct. 1, 2019 and before Oct. 1, 2020: 1.059%

– Loans first disbursed on or after Oct. 1, 2020 and before Oct. 1, 2023: 1.057%

Note: Loans first disbursed prior to Oct. 1, 2019, have different loan fees.

Direct Unsubsidized Loans are available to undergraduate and graduate students; there is no requirement to demonstrate financial need.

To apply for a Direct Loan, you must first complete and submit the Free Application for Federal Student Aid (FAFSA) form.

Your school determines the amount you can borrow. There are limits on the amount in subsidized and unsubsidized loans that you may be eligible to receive each academic year (annual loan limits) and the total amounts that you may borrow for undergraduate and graduate study (aggregate loan limits).

More: Student loan limits: how much can you borrow in student loans?

Repayment options for Direct Unsubsidized Loans are similar to those for Direct Subsidized Loans and include:

1.) Standard Repayment Plan: A fixed monthly payment for up to 10 years.

2.) Graduated Repayment Plan: Payments start low and increase every two years, up to 10 years.

3.) Extended Repayment Plan: Fixed or graduated payments over a period of up to 25 years.

4.) Income-Based Repayment (IBR) Plan: Monthly payments are based on income and family size, and the loan is forgiven after 20-25 years of payments.

5.) Pay As You Earn (PAYE) Plan: Monthly payments are based on income and family size, and the loan is forgiven after 20 years of payments.

6.) Revised Pay As You Earn (REPAYE) Plan: Monthly payments are based on income, regardless of family size, and the loan is forgiven after 20-25 years of payments.

It’s important to note that with Direct Unsubsidized Loans, the borrower is responsible for paying the interest that accrues while they are in school, during the grace period, and during any deferment or forbearance periods. Borrowers can choose to pay the interest as it accrues, or they can allow it to accumulate and be capitalized (added to the loan balance), increasing the total amount to be repaid. It is also possible to switch repayment plans if necessary.

More: How to select the best federal student loan repayment option.

The interest rates for Direct Unsubsidized Loans first disbursed on or after July 1, 2022 and before July 1, 2023 are:

– Undergraduate borrowers: 4.99%

– Graduate or professional borrowers: 6.54%

You are responsible for paying the interest on a Direct Unsubsidized Loan during all periods.

Yes, there is a loan fee on all Direct Subsidized Loans and Direct Unsubsidized Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed:

– Loans first disbursed on or after Oct. 1, 2019 and before Oct. 1, 2020: 1.059%

– Loans first disbursed on or after Oct. 1, 2020 and before Oct. 1, 2023: 1.057%

Note: Loans first disbursed prior to Oct. 1, 2019, have different loan fees.

To receive a parent PLUS loan, you must:

1.) be the biological or adoptive parent (or in some cases, the stepparent) of a dependent undergraduate student enrolled at least half-time at an eligible school;

2.) not have an adverse credit history (unless you meet certain additional requirements); and

3.) meet the general eligibility requirements for federal student aid

Note: Grandparents (unless they have legally adopted the dependent student) and legal guardians are not eligible to receive parent PLUS loans, even if they have had primary responsibility for raising the student.

To apply for a parent PLUS Loan, go to the online Direct PLUS Loan Application for Parents.

Important: Most schools require you to apply for a Direct PLUS Loan online, but some schools have different application processes. This site has a list of schools that participate in the Direct Loan Program. When you select your child’s school from the list, the site will tell you if the school has a different application process. In that case, check with the school’s financial aid office to find out how to request a parent PLUS loan.

Note: Before applying for a parent PLUS loan, make sure your child has filled out the FAFSA form.

The maximum PLUS loan amount you can borrow is the cost of attendance at the school your child will attend minus any other financial assistance your child receives. The cost of attendance is determined by the school.

More: Student loan limits: how much can you borrow in student loans?

Parent PLUS loans have a few repayment options:

1.) Standard 10-Year Repayment Plan: You make equal monthly payments for 10 years. With a standard repayment plan, you’ll pay less in interest and pay off your loans faster than you would on other plans.

2.) Graduate Repayment Plan: You make small monthly payments over the course of 25 years, with the monthly payment increasing every two years. Graduated repayment plan would result in smaller monthly payments upfront that gradually increase over time.

3.) Extended Repayment Plan: You make equal monthly payments for the entire 25-year repayment period. With the Extended Repayment Plan, you will have smaller monthly payments, but you will pay more over the life of the loan.

4.) Income-Contingent Repayment Plan: You make payments that are set based on your income (typically 10-20% of your income). With an income-contingent repayment plan, you will likely pay more over the life of the loan in comparison to the standard repayment plan. Note that you will only qualify for income-contingent repayment if you consolidate your Parent PLUS loans.

More: How to select the best federal student loan repayment option.

For Direct PLUS Loans first disbursed on or after July 1, 2022, and before July 1, 2023, the interest rate is 7.54%. This is a fixed interest rate for the life of the loan.

You are responsible for paying the interest on parent PLUS Loans during all periods.

Yes, there is a loan fee on all Direct PLUS Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed.

– Loans first disbursed on or after Oct. 1, 2021, and before Oct. 1, 2022: 4.228%

– Loans first disbursed on or after Oct. 1, 2022, and before Oct. 1, 2023: 4.228%

Note: Loans first disbursed before Oct. 1, 2021, have different loan fees.

To receive a grad PLUS loan, you must

1.) be a graduate or professional student enrolled at least half-time at an eligible school in a program leading to a graduate or professional degree or certificate;

2.) not have an adverse credit history (unless you meet certain additional eligibility requirements); and

3.) meet the general eligibility requirements for federal student aid.

The maximum PLUS loan amount you can borrow is the cost of attendance (determined by the school) minus any other financial assistance you receive.

More: Student loan limits: how much can you borrow in student loans?

Grad PLUS Loans are eligible for the Standard Repayment Plan, Graduated Repayment Plan, Extended Repayment Plan, and all income-based plans.

1.) Standard 10-Year Repayment Plan: You make equal monthly payments for 10 years. With a standard repayment plan, you’ll pay less in interest and pay off your loans faster than you would on other plans.

2.) Graduate Repayment Plan: You make small monthly payments over the course of 25 years, with the monthly payment increasing every two years. Graduated repayment plan would result in smaller monthly payments upfront that gradually increase over time.

3.) Extended Repayment Plan: You make equal monthly payments for the entire 25-year repayment period. With the Extended Repayment Plan, you will have smaller monthly payments, but you will pay more over the life of the loan.

4.) Income-Based Repayment (IBR) Plan: You make monthly payments based on income and family size, and the loan is forgiven after 20-25 years of payments.

5.) Pay As You Earn (PAYE) Plan: You make monthly payments based on income and family size, and the loan is forgiven after 20 years of payments.

6.) Revised Pay As You Earn (REPAYE) Plan: You make monthly payments based on income, regardless of family size, and the loan is forgiven after 20-25 years of payments.

Note: You do not have to make any payments on your grad PLUS loan while you’re still enrolled in school. You will also have a 6-month grace period following graduation where you won’t have to make payments. However, interest will accrue on your grad PLUS Loan as soon as it’s disbursed.

More: How to select the best federal student loan repayment option.

For Direct PLUS Loans first disbursed on or after July 1, 2022, and before July 1, 2023, the interest rate is 7.54%. This is a fixed interest rate for the life of the loan.

You are responsible for paying the interest on grad PLUS Loans during all periods.

Yes, there is a loan fee on all Direct PLUS Loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. The percentage varies depending on when the loan is first disbursed.

– Loans first disbursed on or after Oct. 1, 2021, and before Oct. 1, 2022: 4.228%

– Loans first disbursed on or after Oct. 1, 2022, and before Oct. 1, 2023: 4.228%

Note: Loans first disbursed before Oct. 1, 2021, have different loan fees.

Private student loans are available to borrowers who meet the following criteria:

1.) Age and citizenship: Borrowers must have a Social Security number and be a U.S. citizen or permanent resident (although some lenders accept international students, with or without a US cosigner). The borrower must also be at least 18 years old and have a high school diploma or equivalent, like a GED. In some states, the minimum age may be 19.

2.) Enrollment: Borrowers must be accepted or enrolled in an eligible undergraduate, graduate, or professional degree program. This typically includes four-year colleges and sometimes includes two-year community colleges and trade schools.

3.) Credit history: Borrowers must have a strong credit score (mid-600s or higher) in order to be eligible. As your credit score increases, you’ll have more borrowing options and may receive a lower interest rate.

4.) Income: Most student lenders require the borrower to have a steady source of income or employment.

If you don’t have a strong credit history or income, you may want to consider adding a creditworthy cosigner to increase your chances of eligibility.

Eligibility criteria for private student loans may vary among different lenders, so it’s important to research and compare different options to find the loan that best fits your needs. Sparrow can help you streamline the search and comparison process.

Note: There are a handful of private lenders that don’t require borrowers to meet the criteria above. To check your eligibility with these lenders, submit Sparrow’s two minute form.

More: Who is eligible for a student loan?

Here are the steps to apply for a private student loan:

1.) Pre-qualify with Sparrow: Sparrow’s free search engine allows you to compare pre-qualified rates from multiple lenders, without impacting your credit score. We’ll help you compare interest rates, repayment terms, and other loan features. If your credit score is not strong enough to pre-qualify on your own, consider finding a creditworthy cosigner to increase your chances of pre-qualifying. Once you’ve found the right loan, we’ll bring you to the lender’s website to start the official application process.

2.) Complete the loan application: Before you apply with the lender, make sure you have all the required documents, such as proof of income, enrollment, and identity. Once you’ve got all the required documents, fill out the loan application, including information about yourself, your cosigner (if applicable), and your school.

3.) Wait for loan approval: The lender will review your application and make a decision on whether to approve your loan. This process can take several days to a few weeks.

4.) Receive loan funds: If the lender reviews and approves your application, the loan funds will be disbursed directly to the school. The school first applies your loan money toward your tuition, fees, and room and board. Any money left over is paid directly to you for other education expense.

Note: Always thoroughly read and understand the terms and conditions of the loan before you sign any loan agreements or promissory notes.

More: How to apply for private student loans.

Unlike most federal loans, with private lenders, you can borrow up to 100% of the school’s certified cost of attendance. To determine how much you can borrow, lenders look at your income, credit score, current major, future projected income, and whether or not you have a cosigner.

That exact amount varies by lender, but private student loan limits are generally based on a total loan amount ranging from $75,000 to $120,000 for undergraduate students and $150,000 to $300,000 for graduate or professional students. Graduate and professional students can typically borrow more due to higher education costs and expected earnings.

More: Student loan limits: how much can you borrow in student loans?

Private student lenders offer several different repayment options (not all of these options are available for all loan products or from all lenders):

1.) Immediate: Full payments begin shortly after the loan is disbursed.

2.) Interest Only: Pay only the interest while you are in school.

3.) Flat / Fixed In-School: Make a fixed payment (typically $25) of both interest and principal, lower than a full payment, while you are in school.

4.) Fully Deferred: Payment is completely deferred until after you graduate, typically for a period of six months. But, interest starts accruing as soon as funds are disbursed.

More: The best repayment plan for private student loans.

The current private student loan interest rates can vary widely depending on the lender, the loan terms, and the borrower’s financial situation. As February 2023, private student loan interest rates can range from as low as 3% to as high as 15% or higher.

With Sparrow, you can submit a single form and quickly compare loan rates from multiple lenders so you know exactly how each loan offer stacks up.

More: Best private student loans.

You are responsible for paying the interest on a private student loans during all periods.

Unlike federal student loans, most private student lenders do not charge fees.

With that said, here are some fees to look out for:

1.) Application fee: Some lenders charge an application fee for processing your loan application. This fee can be a flat rate or a percentage of the loan amount.

2.) Origination fee: An origination fee is charged by the lender for originating or processing your loan. This fee is typically a percentage of the loan amount and can range from 1% to 6% or more.

3.) Late fee: If you miss a loan payment, you may be charged a late fee. The amount of the late fee can vary depending on the lender and the loan terms.

4.) Prepayment penalty: If you pay off your loan early, some lenders may charge a prepayment penalty. This fee is designed to compensate the lender for the interest they will lose if you pay off your loan early.

While most lenders don’t charge fees, it’s important to carefully review the loan documents before you sign to understand the full cost of the loan.

The eligibility requirements for student loan refinancing vary by each lender. In general, to be eligible to refinance your student loans, you typically need to meet the following criteria:

1.) Credit Score: Most lenders require a minimum credit score of 660 or higher to refinance student loans. A higher credit score can also help you get a lower interest rate.

2.) Debt-to-Income (DTI) Ratio: Generally, you’ll need a DTI below 50% to be able to refinance student loans. The lower your DTI, the better your chances of qualifying and getting a low interest rate. Lenders determine debt-to-income ratio, or DTI, by dividing your total monthly debt payments by your gross monthly income.

If you don’t meet the criteria above, you may want to consider adding a creditworthy to help you qualify.

More: What credit score do I need to refinance my student loan?

Here are the steps to apply to refinance your student loans:

1.) Compare rates: Sparrow’s free search engine allows you to compare rates from multiple lenders, without impacting your credit score. We’ll help you compare interest rates, repayment terms, and other loan features. Once you’ve found the right loan, we’ll bring you to the lender’s website to start the refinancing process.

2.) Complete the application: After selecting a lender, you will need to complete an official loan application. This typically triggers a hard credit check, which gives the lender access to your complete credit report and may temporarily impact your credit score. You may also be required to provide additional information, such as your personal information (SSN & ID), financial status, and employment history.

3.) Sign and start repayment: If your loan application is approved, you will be asked to sign new loan documents and agree to the terms and conditions of the new loan. Once you have signed the loan documents, your existing loan will be paid off by your new lender and you will start making payments on the new loan. Before signing, make sure you fully understand the new loan terms and what you are agreeing to.

More: Guide on how to refinance student loans.

While exact amounts will vary by lender, in general, you can refinance as much student loan debt as you want, up to the amount of the loan balance.

Across all lenders on the Sparrow marketplace, here are the minimum and maximum refinancing amounts:

Minimum: $5,000

Maximum: $500,000

More: Student loan limits: how much can you borrow in student loans?

If you’re refinancing your student loan (federal or private), you’ll likely need to begin full payments shortly after the loan is disbursed. Look out for a note from your lender/servicer for more detailed information.

The current student loan refinancing interest rates vary widely depending on the lender, the loan terms, and the borrower’s financial situation. As February 2023, student loan refinancing rates range from as low as 3% to as high as 11% or higher.

With Sparrow, you can submit a single form and quickly compare loan rates from multiple lenders so you know exactly how each loan offer stacks up.

More: Best student loan refinance rates.

You are responsible for paying the interest on a refinance student loans during all periods.

Unlike federal student loans, most private student lenders do not charge fees.

With that said, here are some fees to look out for:

1.) Application fee: Some lenders charge an application fee for processing your loan application. This fee can be a flat rate or a percentage of the loan amount.

2.) Origination fee: An origination fee is a fee charged by the lender for originating or processing your loan. This fee is typically a percentage of the loan amount and can range from 1% to 6% or more.

3.) Late fee: If you miss a loan payment, you may be charged a late fee. The amount of the late fee can vary depending on the lender and the loan terms.

4.) Prepayment penalty: If you pay off your loan early, some lenders may charge a prepayment penalty. This fee is designed to compensate the lender for the interest they will lose if you pay off your loan early.

While most lenders don’t charge fees, it’s important to carefully review the loan documents before you sign to understand the full cost of the loan.