go2school wrote:
I feel I can get better terms from private loans.
Totally reasonable conclusion. Federal loans do come with much better protections and flexible repayment options than private ones, but can be more expensive. I opted for 100% private/variable on my MBA loans.
go2school wrote:
How does the private lender know about federal loans I've applied for?
They don't.
go2school wrote:
Do I have to wait until I'm approved for federal loans before I move on to applying for private lending?
No.
go2school wrote:
Or do I just take total cost of attendance - federal loans applied for = amounts I apply for privately?
That's the basic idea. You also have to subtract any scholarships, fellowships, and grants. My calculations never quite lined up with school's, so I applied for a few grand more than I knew I'd be eligible for. You can always accept a lower amount than you're approved for.
go2school wrote:
I'm also curious how different lenders know what I've applied for? I'd like to do gov loan + variable interest loan from one lender + fixed interest loan from a second lender.. Is it up to me to make sure total is only to the published cost of attendance?
They won't know what you've applied for, but they'll find out how much you've accepted from other lenders. Basically the process is this:
- Figure out what combination of loans you wants (up to COA less scholarships etc)
- Tell your financial aid officer
before you accept with the lenders. For example: "I want my full Stafford amount ($20,500), $30,000 from Discover, and the balance of the COA from Citizens."
- The school is the clearing house that ensures you don't take more than the COA.
- Note that it works best to leave the last loan open-ended (e.g. "the balance of the COA"). Let the school do the math.