What's the difference between a federal loan and a private student loan?

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Last Updated: April 30, 2022

Federal student loans are funded directly by the federal government. Applying for a Federal student loan requires that you complete the Free Application for Federal Student Aid (FAFSA). We recommend that you complete the FAFSA and apply for federal student loans before considering private student loans. Those who do not qualify for federal loans or who have already exhausted their federal loans often consider private undergraduate student loans.

Private loans are any student loans issued by banks or other private lenders. When it comes to choosing a private student loan, there is no one-size-fits-all solution; students should compare their options and find a solution that works best for their financial situation. 

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