There are 3 types of loan programs for undergraduate students.
Federal Direct Student Loan- A federal loan where the student is the borrower. These loans must be repaid. Loan limits are determined by the student's grade level. The Federal Direct Student Loan and the amount for which a student is eligible will appear on the student's Financial Aid Award Notification should the student qualify for this loan program.
Federal Direct Parent Loan (PLUS)- A credit based federal loan where the parent is the borrower. These loans must be repaid. Parents may borrow up to the Cost of Attendance minus any financial aid the student is receiving. This loan program assists families with paying the remaining charges that are not covered by other types of financial aid.
Private Alternative Loans- These are private credit based loans where the student is the borrower often with a credit worthy co-signer. These loans must be repaid. This is another option for families to use for paying the remaining charges that are not covered by other types of financial aid. Since the interest and fees are lower on federal educational loans, students should maximize their federal loan eligibility before applying for a private loan.