An alternative loan is a personal loan from a bank that is used for educational expenses. These loans are often used as a supplement to a student's existing financial aid package, so be sure to accept your Federal Direct Loans before you apply for an alternative loan. Most alternative loans are deferrable until you graduate; however, some may require you to pay interest while you are attending school.


Applying for alternative loans

  • If you need additional funds and have exhausted all other options, you may want to consider an alternative loan.
  • The Alaska Supplemental Education Loan (ASEL) is an example of an alternative loan.
  • Alternative loans are based on your credit, and therefore usually require a credit-worthy cosigner.
  • Make sure you compare lenders before deciding. When you are ready to apply, make sure you follow the instructions on the lender's website for completing the application.
  • Lenders are bound by legislation in the Truth in Lending Act and the Higher Education Opportunity Act. There are minimum required waiting periods for various steps in the application process. Though lenders' policies may vary, there are several general steps that must occur.
  • Once you submit your application, the lender will send you an Application Disclosure and Self-Certification Form. Both documents will require you to actively accept the terms and conditions. The Self-Certification form will need data from your UAOnline account.
  • If you are approved, the lender will contact us for our portion of the loan certification. Upon submission of the School Certification Form, you will receive the Final Disclosure from the lender.
  • You have a 3 day rescission period from receipt of the Final Disclosure. During this period, you still can opt to cancel the loan. Although the overall processing time by lenders will vary, several weeks is a definite possibility. Give yourself time, and apply early!
  • Remember your combined resources (including grants, scholarships, tuition waivers, etc) cannot exceed your cost of attendance/budget.