How To Get a Student Loan: Federal & Private Requirements

Student loans are a key part of college financing for many students, especially when scholarships, grants, and personal savings fall short. In fact, about 30% of adults who pursued higher education needed to borrow for school, according to the Federal Reserve. If you’re weighing your options, understanding the types of loans available and how the student loan application process works is essential to covering your education costs responsibly.

This guide walks you through how to get both federal aid and private student loans — from filling out the FAFSA to comparing lenders and preparing for student loan approval. 

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Federal loans are the first place to start when you’re paying for college with financial aid. Federal aid offers more than private lenders, like flexible repayment options and fixed interest rates. After you've exhausted federal aid but still have educational expenses to cover, private student loans are another option. Both have similar eligibility requirements, but they also have plenty of important differences you should know.

Federal vs. private student loan requirements

These are the eligibility requirements for federal and private student loans:

Beginning in July 2026, new federal student loans will no longer qualify for any of the current income-driven repayment plans. Instead, all new borrowers will repay their loans under a new plan, the Repayment Assistance Plan (RAP), and it will be the only income-based repayment (IBR) option. 

Existing borrowers who are already enrolled in IBR — or who switch to IBR before July 1, 2028 — can continue using IBR or choose to move to RAP later. If you fall into this group, you’ll need to compare IBR vs. RAP to decide which plan offers the best long-term benefits.

How to get a federal student loan

Federal loans are considered the most borrower-friendly. To apply, you must submit the Free Application for Federal Student Aid (FAFSA). Schools use the FAFSA to determine your eligibility for various financial aid, including federal student loans, scholarships, grants, and work-study opportunities.

Undergraduate loans don't require a credit check and have fixed interest rates, but include borrowing limits on certain loan types. Federal loans have different repayment options and benefits, including income-driven repayment plans and loan forgiveness. Because of this, you want to exhaust federal loans before turning to private lenders.

Federal student loan eligibility

Federal loans offer significant advantages over private loans, including potential loan forgiveness and protections like deferment and forbearance, which allow you to pause loan payments during financial hardship. Eligibility depends on your Student Aid Index (SAI), your year in school, your enrollment status, and the cost of attendance at the school you want to attend.

To be eligible for federal student loans means:

Federal student loan requirements

The government limits how much you can borrow in student loans each year and over your lifetime, depending on your academic level and dependency status. Dependent students must have a contributor, like a parent, provide their information, including a consent to transfer tax data directly from the IRS to the FAFSA application. Contributors must also sign up for an FSA ID to complete their sections and sign the FAFSA form.

Here's what do you need to complete in order to qualify for a federal student loan:

1. Create a FSA ID: You must create a Federal Student Aid (FSA) ID — a unique username and password required to complete the FAFSA and access your account on StudentAid.gov.
2. Fill out the FAFSA: The FAFSA application opens around Oct. 1 every year. It's available online and typically takes less than an hour to complete. You'll need your Social Security number, date of birth, email, and details about your income and assets (or your parent's, if applicable).
3. Sign and submit the FAFSA: After you (or your parents, if applicable) have completed the FAFSA, sign and submit it.

FAFSA income limits

After submitting the FAFSA, schools where you were accepted will send you a financial aid award letter outlining the types of aid you qualify for. This can include scholarships, grants, federal work-study, and federal student loans:

Federal need-based financial aid

The school you're attending determines your financial need by using this formula: cost of attendance (COA) - SAI = financial need. Need-based financial aid programs include:

• Federal Pell Grant: These grants don't have to be repaid, except under certain circumstances. Your eligibility is determined mostly by financial need and a few other factors, including citizenship status, academic enrollment, and academic progress, to name a few.
• Direct Subsidized Loans: Formerly called Stafford Loans, the government pays the interest on these loans while you're in school and during the 6-month grace period following graduation, reducing your overall borrowing costs. The school determines how much you can borrow, and the amount can't exceed your financial need.
• Federal Supplemental Educational Opportunity Grant (FSEOG): This need-based grant that offers for between $100 and $4,000 per year by participating schools for undergraduate students with exceptional financial need.
• Federal Work-Study: This provides part-time jobs for undergraduate and graduate students with financial need, allowing them to earn money to help pay education expenses. The program encourages community service work and work related to your course of study.

These types of federal loans aren't based on your financial need:

• Direct Unsubsidized Loans: Available to both undergraduate and graduate students and don't require proof of financial need, making them more accessible. The amount you can borrow is determined by your school's cost of attendance, less any other financial aid you receive. You're also responsible for paying the accrued interest.
• Direct PLUS Loans: Graduate students and parents of dependent undergraduate students can apply for PLUS loans, also called parent PLUS loans or grad PLUS loans. To qualify, you usually have to have good to excellent credit.

Direct Subsidized and Unsubsidized Loans have borrowing limits for how much money you can receive, which depend on your academic year in school and dependency status. PLUS loans help cover your school's full cost of attendance after any other financial aid you may receive.

If your application is denied, it could be because you don't meet the eligibility criteria or need to provide additional documentation. Graduate students and parents applying for PLUS loans may face another potential obstacle.

“For federal loans, this would come from an adverse credit history. You could obtain an endorser, who agrees to pay your loans if you do not. You can also file an appeal if there are extenuating circumstances,” says Erik Kroll, certified financial planner and president of Student Loans Over 50.

After reviewing your financial aid offers and choosing a school, you can officially accept your federal aid. Start with any grants and scholarships because they don't have to be repaid. If you've qualified for a Direct Subsidized Loan, prioritize it next since it's usually a more cost-effective option. Remember only to borrow what you need to cover your educational expenses.

If you're a first-time borrower, you'll also have to complete entrance counseling to understand your responsibilities and to sign a Master Promissory Note agreeing to the loan terms.

Federal loan funds are sent to your school first to cover tuition, fees, and, if applicable, room and board. If money is left over, the school sends you the remaining balance, which can only be used for qualified educational expenses, like textbooks, supplies, or electronics.

Check Out: What Is the Average Cost of College?

How to get a private student loan

Private student loans are primarily offered by banks, credit unions, and online lenders. They usually require a credit check to evaluate your creditworthiness. Most private lenders will let you apply with a cosigner if you don't meet their specific criteria. Private student loans offer both fixed and variable interest rates but have fewer repayment options and borrower protections than federal loans.

Eligibility for private student loans

The eligibility criteria for private student loans are similar to those for federal loans but go a step further with checking credit scores and income. Every lender has different qualifications but, in general:

Private student loan requirements

If you've maxed out your federal student loan options, private student loans can help cover any remaining balances. Lenders may let you borrow up to the full cost of attendance, but eligibility depends on several factors like credit history and income (or that of a co-signer).

These loans should generally be a last resort because they lack the protections and benefits federal loans offer, including forgiveness programs and specific repayment plans.

Here's everything private student loan lenders consider:

Credit score and history

Private lenders check your credit score and income to determine your eligibility and the interest rate you're offered. Most lenders require a minimum credit score — often around 670 — and can reject applications from those who don't meet their criteria. You'll likely need a cosigner to qualify if you have limited or bad credit. The interest rate will likely be lower than if you apply alone.

Income

Beyond credit requirements, most lenders also expect applicants to meet a minimum income threshold. Some let you know ahead of time what that amount is, but most don't. Higher earnings can improve your chances. To verify your income and employment, lenders usually request documentation from both you and your cosigner.

Debt-to-income ratio

Lenders use your debt-to-income ratio (DTI) to evaluate how much of your monthly income goes toward debt. A lower DTI suggests you can handle new loan payments more easily.

School and program

Some lenders only approve loans when you attend certain accredited schools or are enrolled in specific degree programs. Your enrollment status (half- or full-time) may also be a determining factor since most (not all) lenders require borrowers to be in school full time.

Loan amount and terms

Private student loan lenders will assess how much you need to borrow and the repayment term you choose. Larger amounts or longer terms may mean stricter qualifications. Each lender has minimum and maximum loan amounts to make sure they can meet your borrowing needs. Most lenders offer 5-, 7-, 10-, 15-, and some even 20-year repayment term options.

After submitting your application, the lender reviews your information and can either approve or deny your application, or ask that you provide additional documentation, which you should respond to as soon as possible to avoid delays. When your application is denied, the lender should explain the reason they rejected it.

If approved, the lender will typically send funds directly to your school to cover your tuition, fees, and room and board that's not already covered by federal aid you might have received. Any remaining funds will be disbursed to you to cover other education-related expenses, such as textbooks or supplies.

Tips for choosing the best student loan

Federal student loans are almost always the best place to start because of their competitive, stable rates, flexible repayment options, and borrower protections. Private loans can help cover remaining costs, but should be used cautiously.

When you're comparing loans, calculate the total borrowing costs. Tools like the Federal Student Aid's loan simulator or a student loan repayment calculator can help you better understand how interest rates, loan terms, and repayment plans will affect your overall payments.

“Misinformation has been rampant as the federal student loan litigation makes its way through the courts, so it's important that borrowers reach out directly to their loan servicers with questions about student loan relief, or to certified credit counselors with expertise in student loans working for nonprofit credit counseling organizations,” advises Donna Loitz, housing and student loan counselor lead at American Financial Solutions.

Prequalify with multiple private loan lenders to see interest rates and loan terms you might qualify before officially applying. Most lenders offer this option without affecting your credit score since it involves a soft credit check instead of a hard inquiry. A hard inquiry usually only happens when you submit a full loan application.