Recommended Lender Review and Selection Process for Alternative Loans
Students should exhaust federal loan eligibility before borrowing through an alternative private student loan. However, each family’s borrowing needs are unique and for those who decide to pursue a private alternative loan, Carleton College provides a recommended lender list. Our recommended lender list consists of four lenders for our alternative private loans: Chase, Minnesota Office of Higher Education (MOHE), US Bank, and Wells Fargo. Last year new regulations went into effect regarding the use of recommended lender lists. After using a historical lender list for the 2010-2011 academic year, we felt that for 2011-2012 it would be more beneficial to families for us to review lenders and once again provide a recommended lender list. This spring we sent out a series of questions to lenders and invited lenders to submit proposals specific to Carleton and our questions. The same questions were posed to all lenders regarding what types of benefits they could offer our students as well as details regarding their loan products. To assist us in evaluating lenders that offered similar products, we developed a case study and asked lenders specific questions to ascertain the full cost of a loan and the benefits that could be expected through their program. The Student Financial Services (SFS) staff reviewed each submitted proposal thoroughly and determined four lenders for our recommended alternative private lender list based on the clarity of the proposal, benefits available to our students, and cost of the loans over time. The four lenders on our recommended list were able to meet the high standards we set forth and conformed to the personalized service our students deserve. Throughout our entire selection process we had uppermost in our minds the financial benefits that our students would gain and the importance of serving our students and their families in a manner that represents Carleton well. Based on our review, we believe the lenders we recommend provide our students with the best loan products available. No lender asked for concessions that would lead to even better rates or options and no lender offered financial considerations for placement on our list.
At Carleton, we have worked hard to ensure that we have sufficient tools to offer our students and their families who are faced with the cost of coming here. The reality is that we cannot count on only one source of financing for any one student. Instead, we must often draw on multiple types of assistance including loans that must be repaid. As described above, we have been very careful and deliberate in our recommendation of loans to students. We are confident that our students are not being disadvantaged by taking any of our options. Financial considerations discussed by lenders have been those directed to students in the form of lower interest rates, fewer fees and other borrower benefits.
It is also our policy that students can seek loans using any lender they choose. Our recommended lenders are only suggestions, and we will not hamper any student nor parent from using other lenders. However, we have prepared a recommended list because our students and parents continue to ask us to provide them with direction when choosing a lender. The student loan business is very competitive and can be confusing. So, it is not surprising that many students seek advice from us and place their trust in our recommendations. We take that trust seriously, and we believe we have earned that position with our students.
It is our intention in the SFS Office to continue our efforts to provide our students with all possible resources including grants, scholarships, student employment, and loans. We welcome your comments and questions by contacting us at 507-222-4138 or at mailto:firstname.lastname@example.org.