Private Student Loan Companies: A List and How They Work

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Private student loan companies are typically banks and credit unions. You’ll find many of these offer private student loans in every state. I have made a list below with several lenders you can contact.

But making a comprehensive list might not help you – here’s why: almost any bank or lending institution may offer this type of student loan. And you don’t really need to contact all of them, just ones that will loan to you.

Which Private Student Loan Companies to Contact?

I’d suggest contacting the banks and credit unions you already do business with. If you have a credit card, see if that company is a private student loan company as well. I suggest this because they may be more favorable in their rating if you have been a good customer in the past.

For example, Citizens offers a quarter percent (.25%) discount on your interest if you or your cosigner have an active account with them. This type of discount isn’t unusual. Nelnet also offers these types of discounts – I used to take advantage of them when I was paying mine off!

Really Big Private Student Loan Companies 

Sallie Mae


Discover Student Loans

College Ave Student loans


Social Finance (SoFi)



Citizens bank

Wells Fargo Bank

Chase Bank 


I have found references to up to 3100 lenders – I won’t make a full list right here. Maybe in the future I’ll find the full list and publish it. 

I mention this because you don’t really need a list from me. You can use one of the biggest, which are listed above, or you can go to your university financial aid office, or your bank or credit union, and ask if they make private student loans, and get started that way.

While you are asking about loans, ask the financial aid office how to apply for as many scholarships as possible. Apply for some and see what happens. 

Remember to Try Your Other Financial Aid Options

One more word about scholarships and grants – in other words financial aid that you don’t have to pay back – many students don’t apply. They figure they don’t qualify, or they don’t want to take the time to fill out the paperwork. I get it – it’s work. You might have to write an essay or make a video.

Try to make this a game. See how many you can apply for in a short period. If you love an essay you wrote, use it as a basis for another essay on another application! Or as the script for a video you shoot.

Look, sometimes in life you make your own opportunities. I can’t guarantee that if you apply, you’ll win. No one can. But I can guarantee if you don’t apply, you definitely won’t win. And you may always wonder what would’ve happened.

Also, and this really is my last word on this subject for this page, as you apply, you’ll find you get into a rhythm, and you get better at the applications. Hopefully, you will also get some approvals, some money out of it. And if not, then at least some rejections to tell you what to do better. Give it a shot.

Back to private student loan companies.

Not a Bank, but Still a Lender?

Some private student loan companies refer you to lenders, but don’t actually lend themselves. by Lendingtree – because they aren’t a lender, their advice is meant to be more objective. They can provide you with several private student loan companies to choose from on their site, and guidance in general. While they do want to help you find a loan, they will do better to help you find a good loan, and a good company that treats you and other students fairly. 

No Private Student Loans Offered

I included this list because these companies used to offer student loans or are just huge banks. You can use this list to avoid wasting time when looking for your loan.

JP Morgan

US Bank

Citibank – the link goes to which is one of the biggest private student loan companies

Bank of America

Navient – this used to be a part of Sallie Mae. Now, Navient just services loans. As far as I can tell, Navient does not lend money, just collects payments for federal student loans (like Stafford and PLUS loans).

Cosigner Required?

Lots of times, to get a student loan you will need a cosigner. I know it stinks. Lenders require this because you don’t have much of a credit history, and in the case of some students, maybe even some of your friends, they haven’t been exactly responsible with their loans.

I’m sure you know at least one person who didn’t finish college. I understand, they decided to do something different with their life or maybe they got married. It happens, right?

But in those cases, students who stopped going to school also stopped paying their loans, or maybe never paid them. I’m not judging, I’m just saying that the risk of giving young people $10,000 or so is a large risk. Banks don’t want to just hand out checks for this amount with no idea that they will get their money back!

The good news is that if you pay your private student loan company on time, many will let you release your cosigner. If the company offers this option, it will be somewhere in your loan documents. I have seen companies allow students (hopefully graduates) to release their cosigners after 36 months of on time payments.

That may be a tough pill to swallow for some parents, but at least there is some way to get released.

More About The Biggest

The largest of the private student loan companies get the lion’s share of the loans. You probably have heard of Wells Fargo, Discover, SallieMae and SoFi, but not many of the others. 

These few I have mentioned and a few more probably make well over half of the private student loans. The others may work with large groups of students regionally. You may know of a large bank or credit union that has a branch at your campus.

That branch is a clue – they probably loan to students. You may have a friend who can tell you if they are easy or hard to work with. In my experience, the local company is generally easier than the large national company, but the large company may qualify you more easily. You will have to decide.

Should You Apply?

First, you should have by now already filled out a federal application for student aid – A FAFSA form. You fill these out yearly to apply for federal financial aid. 

Understand this: A scholarship, a grant, a subsidized or unsubsidized student loan are ALL forms of financial aid. If you were approved for a Pell grant, or a scholarship, use those first (of course). 

If you were approved for subsidized or unsubsidized federal student loans, use those next.

Only after using your approved financial aid should you consider going to a private student loan company for an unsubsidized student loan.

The Application Process

The application process for a private student loan usually still requires a FAFSA to begin. You give your FAFSA to the student loan company, and they will tell you what they can loan you for the school year to go to college.

You will then receive notification of your loan – approved, or rejected. If you are approved, it will tell you the amount, the interest rate, and if you need a cosigner.

You will need to provide information about the cosigner at this stage, to make sure they are acceptable to the private student loan company.

At this point, the next step is signing the promissory note which means you are accepting responsibility for the loan. If the loan requires a cosigner, this is where the cosigner also signs.

Disbursement of Funds

Once your loan has been approved, they will want to send the money directly to your school, to make sure your tuition is paid first. Then, the university (or college) cashier will give you a check for the rest. 

Of course, these funds which come from your private student loan company are for you to spend on school – rent, school supplies, college textbooks, transportation, food, and so on.

Sometimes as students we get ahead of ourselves here. The dates these checks pass from the lender to the school to you may take a little longer than you expect. You might want to plan on your expenses for the first month of school coming from another source, or at least make sure your landlord knows you’ll pay them when it comes in.

And stock up on ramen…;0)

Most schools have a lot of experience with the lenders and know when the checks will come. The cashier should be able to tell you when the money will arrive to pay your tuition, and then when you will get the rest. 

Unfortunately, they do not always move fast, but they will get it done. 

Standard Warnings

Okay, I have to put in a few words of warning:

1. You are responsible for your student loans. I can’t give you financial advice, I’m just telling you what is out there and how it works. When you sign, you are on the hook to pay back the loan with interest. 

2. Some companies may offer you a private student loan even if you are eligible for a subsidized federal student loan like a Stafford loan. You should talk to your guidance counselor and probably use the subsidized loan first, and not get the private one unless you absolutely need it.

3. Remember to avoid borrowing whenever you can. If you decide you have to borrow, borrow as little as possible to get you through the school year. Share an apartment, share a car, use the bus, ride your bike, don’t eat out, don’t subscribe to cable, keep your phone bill as low as possible.

4. Don’t use credit cards to get through your university degree! You’ll pay higher interest and have to make payments during school – bad combo.

5. Never use payday loan companies.

6. I suggest you get a job during school if you can handle the time commitment, and on semester & summer breaks. Earning as you go will decrease what you need to borrow and pay back. Also, it may help you keep your job during breaks, or get a better job and find a good job after you finish your degree. 

7. You may also be able to use tuition reimbursement through your job, and even move into a professional position when you finish. Having a job may also help you get an internship, which I recommend for everyone. Nothing is like real world experience to help you understand working for a living.

Things to Remember...

No private student loan companies are perfect. They have to make money to make their budget, too. They are in this to provide you a service, but it has to make sense for them or they can’t stay in business. 

Before you go ahead with a private student loan, talk to your financial aid counselor, and be sure it is what you really need. You are the one who has to live with the end result. And by the way, if student loans are involved, that result must always include a degree. You don’t get a diploma for getting a loan, you get one for finishing your degree.