For the ACHIEVER in you.
Home Home Home

Private Loans or Federal Loans: Which Option is Best for You?

Find out more:

We all know the benefits of a college education, but figuring out how to pay for it can be confusing. With the rising cost of education, taking out student loans continues to be the most popular way of paying tuition bills.

But what is the best borrowing option for you?

Popular Borrowing Options

  • The Federal Parent Loan for Undergraduate Students (PLUS) is a loan program for parents of dependent undergraduate students. Parents may borrow every year up to the cost of education minus any financial aid (government grants, college scholarships, etc.). There is no limit to the amount you can borrow, and the loans are based upon a parent's creditworthiness, not financial need.
  • Private loans are often used to pay for college. They are available to eligible creditworthy students and co-signers attending eligible schools.
Federal Direct
Stafford Loans
Federal Direct PLUS Loans Federal Direct Grad PLUS Loans PNC Solution Loan™
Borrower
Student Dependent student's biological or adoptive parent or stepparent Independent graduate student Student
Lender
U.S. Government U.S. Government U.S. Government PNC Bank
Annual Loan Limit
Undergraduates, $5,500/$12,500 (dependent/independent); graduate students, $20,500; medical school students, $40,500 Up to 100% of your cost of attendance minus other financial aid Up to 100% of your cost of attendance minus other financial aid Undergraduates: $40,000
Graduate Students: $65,000
Medical Residents and Bar Exam: $15,000
Interest Rate
Undergraduate loans, 4.66%; graduate loans, 6.21% 7.21% 7.21% Fixed from 6.49% to 12.99% (APRs from 6.19% to 12.99%) or variable from
LIBOR + 3.30% to LIBOR + 10.25% (currently 3.36% to 10.40% APR) (effective 7/1/14)
Origination Fees
1.072% of loan amount 4.288% of loan amount 4.288% of loan amount 0%
Interest Rate Discount for Automatic Payments
0.25% 0.25% 0.25% 0.5%
Payment Deferment While in School
No payments due until 6 months after graduation or enrollment in school less than half time No payments due until 6 months after graduation or enrollment in school less than half time No payments due until 6 months after graduation or enrollment in school less than half time No payments due until 6 months after graduation or enrollment in school less than half time. Making interest-only payments while enrolled in school is also an option.
Repayment Plans
10 years with flexibility to extend up to 25 years, and multiple repayment options (visit direct.ed.gov for more information) 10 years with flexibility to extend up to 25 years, and multiple repayment options (visit direct.ed.gov for more information) 10 years with flexibility to extend up to 25 years, and multiple repayment options (visit direct.ed.gov for more information) 15 years standard repayment*
FAFSA Required
Yes Yes Yes No
Credit Check Required?
No Yes Yes Yes
Co-signer/Endorser Required?
No Borrowers with adverse credit history may be required to apply with an endorser Borrowers with adverse credit history may be required to apply with an endorser No, unless borrower is under 17. Most PNC Solution Loan borrowers have applied with a co-signer, as applying with a co-signer may increase your chances of approval
Co-signer/Endorser Release Available?
No No No Yes, after 48 consecutive on-time payments; borrower must pass a credit check
Satisfactory Academic Progress Required?
Yes Yes Yes No

» View a repayment example for the PNC Solution Loan

» Read more about the PNC Solution Loan.

PNC encourages students to explore all scholarship, grant and federal borrowing options before applying for a private loan.

PNC reserves the right to modify or discontinue any or all terms of this program at any time without notice.

Customer Service

To speak to a loan specialist, call:

1-800-762-1001

Create Your Own Strategy

Whether you're planning to borrow or preparing for repayment, we offer tools to help you create strategies that work best for you.

AccessReady logo
RepayReady logo

You are encouraged to explore all scholarship, grant and federal borrowing options before applying for a private loan.

PNC does not provide accounting, tax or legal advice.