FAQs-Private Student Loans

What is a Private Student Loan?

The cuScholar Private Student Loan is issued from a not-for-profit credit union participating in the cuStudentLoans program and can be used to pay for qualified educational expenses including tuition, room and board, books, and other school related expenses. Private student loans serve as a way for students to fill the funding gap between the cost of attending school and the amount of federal loans, grants, and available scholarships.

What is the difference between a private student loan and a federal student loan?

Federal student loans follow guidelines set forth by the U.S. Dept of Education and typically offer fixed and lower interest rates compared to private student loans. However, Federal loans, unlike most private loans, have borrowing limits, which may not allow a student to borrow enough to cover the entire cost of education. Private loans help students fill the funding gap between the cost of attending school and the amount of federal loans, grants, and available scholarships. Both private and federal student loans typically allow students to defer payments while in school and some offer economic forbearance options once a student completes school. Unlike federal loan programs, private lenders assess the credit history of the borrower and cosigner before making a loan.


Privacy & Security

Will my personal information be shared with third parties?

Only information that is necessary and required to complete the loan application process, make payments, and transfer funds may be shared. Please consult our Privacy Policy for additional details.

How is financial information protected?

Our servers are equipped with Secure Socket Layer (SSL) certificate technology, which encrypts the user’s entire online session. Automatic sign out occurs after a period of inactivity. All banking information and social security numbers are stored in a secure off-site data center. All users must pass through our secure verification systems to prevent identity theft. Please consult our Privacy Policy for additional details.

How does identity verification work?

All borrowers must have a valid government-issued photo ID or social security number. This information is used to obtain non-credit based questions from an identity verification agency. The user is asked a series of questions that must be answered correctly. Since these questions are not based on a person’s credit history, obtaining another person’s credit report does not provide sufficient information to pass our identity verification test. Those who violate our security and privacy protections are subject to disciplinary action, including prosecution to the fullest extent allowable by law. Please consult our Privacy Policy for additional details.


Application Process

When should I begin the process?

We encourage you to start early. You can start the loan application process once you know what school you will be attending, the Cost of Attendance for the current academic year, and can provide proof of enrollment. You should allow yourself 6-8 weeks from the time of the initial application until your school receives your funds.

How much can I borrow?

The minimum you can borrow is $2,000 per year. The maximum you can borrow is the certified amount determined by your school. The school certified amount is typically the Cost of Attendance (COA) less any other financial aid received.

How do I apply for the cuScholar Private Student Loan?

The application process must be completed online at http://collegedebtsolution.com/private-student-loans/

Do I need to be enrolled in an educational institution to complete the application process?

Yes, you must provide proof of enrollment at an eligible school within the program to complete the application process.

What proof of enrollment do I need to provide?

If you are a returning student, you must provide an unofficial copy of your most recent graded transcript as proof of enrollment at the school you are attending to complete the application process. If you are an incoming freshman, your school will confirm your enrollment during the certification process.

What proof of income do I need to provide?

You must provide a copy of your two most recent pay stubs within the last 60 days. Pay stubs submitted for review must clearly display the following five pieces of information:

  • 1) Employer Name
  • 2) Pay Period
  • 3) Employee Name
  • 4) Gross Income
  • 5) Deductions

Depending on your type of employment or financial situation, we may be able to accept alternate proof of income:

  • If you are self-employed, you must provide a 2010 and 2011 tax return and required schedules.
  • If you are retired, you must provide a pension and/or social security award letter or 1099R.
  • If you are a commission-based employee, you must provide a 2010 and 2011 W-2 and two recent pay stubs within the last 60 days.

If the loan is cosigned, only the cosigner needs to submit these documents.

What is school certification and how can it affect my loan?

Before our private student loan can pay to your college’s billing account, the school must authorize the loan disbursement date, and the total amount of money that may be provided. This process is completed by the school’s financial aid office where they certify that the student attends the school, and meets a minimum registration status of half time or greater.

School certification also acts as a borrower protection to prevent over borrowing. The school has authority to reduce a private student loan to fit within the Cost of Attendance after all other financial aid is paid to the account (Like Grants and Scholarships)

We are unable to disburse funding until school certification is completed to establish a date and authorized loan amount. We provide the school certification to the college through an electronic servicer (Elm, Great Lakes, etc.) or we can fax a paper certification per request of the school. The school completes the certification, and returns it so we may finalize the application and provide the loan.

Schools will vary on the amount of time it takes to process a student loan certification. Be advised that it may take 7-10 business days or more for a school to respond to a certification request after we have sent it.

If you are concerned about ensuring a timely disbursal on your loan, first make sure your loan is applied for before the semester begins, and then stop by your financial aid office after the certification has been made available to confirm an estimated processing time.

Will this loan be certified?

Yes, all of our loans are certified with the school.

How does the cosigner complete his/her portion of the application?

During the application process, cosigners will be asked to create an account and complete their own application. They complete the same application procedures as the borrower for joint-credit.

Will both the borrower and cosigner’s credit be checked?

Yes. During the application process, and as part of the underwriting process, a credit bureau report is pulled on both the borrower and cosigner. The borrower’s creditworthiness or ability to repay the loan is assessed based on the credit of the borrower, the credit of the cosigner, as well as the borrower’s academic attributes.

What is FACS?

FACS (Fynanz Academic Credit Score) is a proprietary scoring model that assesses borrower creditworthiness by taking into account not only the credit bureau data, but also the student’s academic characteristics such as GPA, course of study, class standing, and year of study.

How do I check the status of my application?

The status of your application is available by signing in to your account. The green status bar you see immediately after login indicates which state your application is currently in.

What do the stages of the status bar mean?


  • The borrower started the application but it has not been credit reviewed for one of two reasons:
  • The borrower hasn’t submitted the application yet
  • The borrower invited a cosigner that has yet to complete his/her portion of the application


  • cuStudentLoans forms an initial credit decision on the borrower and cosigner (if applicable)


  • The borrower is conditionally approved
  • The borrower uploads the requested documents


  • The credit union lender makes a final review of the application


  • The application is final approved
  • The borrower signs the loan agreement and disclosures


  • The loan disbursement is scheduled

After filling out an application is there a commitment to borrow?

No. A borrower may withdraw a request at any time and has up to 30 days from the loan disbursement date to return the money and avoid being charged any fees or interest.


What is the repayment term of the cuScholar Private Student Loan?

The repayment term begins 6 months after the borrower graduates or ceases to be enrolled at least half-time in an eligible degree-granting program. Once repayment begins, the borrower has 10 years to repay the loan.

How soon will a borrower receive the loan proceeds?

The loan proceeds will be sent to the school by check or through electronic funds transfer (EFT). The check will usually be mailed within 5-7 business days of the borrower accepting their final disclosure unless the school requests a later date.

How is the interest rate calculated?

Interest Rate = Base Rate + Loan Margin

The Base Rate is the average of the 3-Month LIBOR (London Interbank Offered Rate) Index, which is a variable component that resets quarterly on the first day of January, April, July, and October.

The Loan Margin stays constant for the life of the loan and is determined at loan inception, depending on the borrower’s credit history and FACS Grade.

What is the LIBOR Index?

The London Interbank Offered Rate (or LIBOR,) is a daily reference rate based on the interest rates at which banks borrow unsecured funds from other banks. This offered rate is the funding cost to a bank and is common to use the offered rate as a benchmark for the bank’s lending rate.

Do you offer any borrower benefits?

Yes! Qualified borrowers can enjoy:

  • No Origination Fee for all student borrowers
  • 1% Interest Rate Reduction once 10% of the loan principal is repaid during the full repayment period
  • 30 Day No-Fee Return Policy allows you to cancel the loan within 30 days of disbursement without fees or interest
  • Cosigner Release Available for creditworthy borrowers after 24 consecutive on-time principal + interest payments

How often is accrued interest capitalized?

Unpaid interest accrues while the borrower is in school. Upon entering full repayment, all accrued and unpaid interest is capitalized (or added) to the principal balance once at the time repayment begins.

What documentation is provided to borrowers?

Borrowers receive electronic monthly statements summarizing all account activities.

What are the Forbearance policies?

Borrowers may request Forbearance due to economic hardship for up to 18 months over the life of the loan. Borrowers are eligible to receive three Forbearance periods up to 6 months each. However, only one Forbearance period may be requested in a calendar year. Interest continues to accrue during Forbearance and the term of the loan is not extended.


cuScholar Private Student Loan Eligibility

Who is eligible for the cuScholar Private Student Loan?

To apply for the cuScholar Private Student Loan you must be a U.S. Citizen or permanent resident enrolled at least half-time in a degree-granting program at an eligible school, and you must be a member of a participating credit union.

If you’re currently not a member of a credit union, you will be prompted to select one that you can join during the application process.

You or your cosigner also must meet our credit requirements. Choosing a creditworthy cosigner will increase the likelihood of being approved and may lead to a lower loan rate. You can apply without a cosigner if you meet all of the credit criteria by yourself.

Does applying for a federal loan impact my ability to obtain the cuScholar Private Student Loan?

No. Students are encouraged to explore and exhaust all federal aid options first, and then use private loans to help pay the remaining education expenses.

What is a cosigner?

A cosigner is a parent, grandparent, guardian or other adult who is creditworthy and willing to assume legal responsibility for the loan liabilities along with you. The cosigner must be a U.S. citizen or Permanent Resident.

Is a cosigner required to obtain a cuScholar Private Student Loan?

In most instances, a cosigner is required to obtain a Private Student Loan. A creditworthy cosigner increases the likelihood of your loan approval and may lead to a lower loan rate. Creditworthy students that meet the credit requirements may apply without a cosigner.

Will the cosigner’s credit record be affected?

Yes, in a cosigned loan both the borrower and the cosigner are jointly liable for making all loan payments. The loan will appear on both the borrower and cosigner’s credit report.

Is the cosigner responsible for repaying the loan?

If the borrower fails to repay the loan, then the cosigner is responsible for repaying the loan. However, the cosigner may be released of this obligation once the borrower is able to meet certain criteria to determine creditworthiness and makes 24 consecutive and on-time full payments of principal and interest during the Repayment Period.



What repayment options are available during the school period?

Two in-school repayment options allow the borrower to defer full principal + interest payments until six months after separating from the school:

  • Interest-Only Repayment:the borrower is immediately responsible for making full monthly interest payments on the loan while enrolled in school. Six months after separating from the school or ceasing to be enrolled at least-half time in a degree granting program, the borrower enters repayment status and is responsible for making full interest and principal payments.
  • Proactive Payment:while enrolled at least half-time in a degree granting program, the borrower is only required to make monthly $25 Proactive Payments during the in-school period. Any unpaid accrued interest is capitalized (or added) to the outstanding loan amount once at the end of the in-school period. Six months after separating from the school or ceasing to be enrolled at least-half time in a degree granting program, the borrower enters repayment status and is responsible for making full interest and principal payments.

What is the In-School Repayment period?

The in-school period lasts while the borrower is enrolled at least half-time and includes a 6-month Grace Period once the borrower leaves school. During this time, the borrower is required to either make full interest payments or a monthly $25 Proactive Payment. Any unpaid interest continues to accrue during the in-school period.

What is a Grace Period?

The Grace Period is a 6-month period of time that begins once a borrower graduates or is no longer enrolled at least half-time in a degree granting program. After the Grace Period, the borrower must begin making regular principal and interest payments. Borrowers are required to either make full interest payments or a monthly $25 Proactive Payment during the Grace Period.

What is a Proactive Payment?

A Proactive Payment is a $25 monthly payment the borrower must make while they are in school. The borrower will begin making full principal + interest payments once they have separated from the school or dropped below half-time status. The Proactive Payment helps the borrower demonstrate financial discipline and saves the borrower interest expenses over the life of the loan.

How are payments made?

All monthly loan payments are made to the servicer, Fynanz Inc., using either an electronic transfer from a financial institution account designated during the application process or mailed in by check. Borrowers can set up automatic monthly ACH payments directly from their account by logging into their account, clicking the Payments tab, and Manage Payments. Please have the following information available: Financial Institution Name, Account Type, Account Holder Name, Routing Number, and Account Number.

Borrowers can submit payments via paper check to the following loan payment address:

Fynanz, Inc.

P.O. Box 824575

Philadelphia, PA 19182-4575

Please write your Loan ID and the payment date in the memo line. For example, if your payment is for your March 1st invoice, please put “03/01/12” next to your Loan ID.

When do borrowers enter full repayment status?

Borrowers are given a six month Grace Period once they graduate or separate from school before they enter repayment status. Once borrowers enter repayment status, they are responsible for making full principal and interest payments.

Some students may not yet have found employment six months after leaving school; therefore, borrowers may request to pay just the interest expense on the loan for the first two years while in repayment status. This is referred to as the “Initial Interest Only” option.

Can a borrower prepay the loan at any time?

Yes, a borrower may prepay the loan either partially or in full at anytime without incurring any fees or penalties. Please submit prepayments via paper check and ensure to write your Loan ID and “Toward Principal” in the memo line.

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"Before visiting the College Debt Solution, I was truly lost on how to resolve my defaulted loans. Now I feel very confident about what my options are to address my past due student debt as well as the resources to bring the loans into good standing once again. "

- William R., Jacksonville, Florida 2012


Our goal is to empower you, the borrower, with the resources and tools to make informed decisions and improve your chances of successfully managing your loans. After all, didn't you attend college to improve your life?

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