After exhausting federal grant and loan options, students who still need additional funds for their education turn to private lending institutions. This option can be a lifesaver when trying to scrounge enough money to pay for school, but keep in mind that most private loans come with drawbacks like higher interest rates, no grace periods, and thorough credit checks.

Getting Started
Deciding which lender you want to work with isn’t like applying to college: It’s not a good idea to submit applications to 20 places and hope to be accepted by at least one. The reason is because every time you ask for a loan through a private institution, they delve deeply into financial information including your credit score. If there are too many inquiries into your credit report, it may actually affect your rating—making it harder to secure a loan now and in the future. Here’s how to go about it the right way:
• Make a short list of potential lenders.
• Give the highest positions on