Private student loan volume is growing much faster than federal student loan volume. If it continues as it is it will soon surpass the federal volume. It is so important that students have the correct tools to compare the different private student loans to learn and understand the validity and scope of the wide range that is out there.

The lender will want to know about your past financial record. This will be in regards to any bankruptcy and your credit rating. If either is showing negative, you will need to go with a secured loan.

A secured loan means you will have to put something up as collateral. The lender will want some guarantee (such as a vehicle, boat, etc.) if you are unable to pay your loan. The larger amount of money you request, the larger the interest rate and fee you will be accessed. This type of loan should be borrowed on a short-term basis.

As you begin your search for a private loan it is important that you find a lender that you can build a good relationship with. This way he or she knows exactly where you are coming from. As a general rule, students should only consider obtaining a private education loan if they have tried to obtain all other loans such as the Federal Stafford Loan, other federal loans, grants, work-study, Federal PLUS Loan, etc.

Watch for lenders to advertise a lower rate for the 'in-school' and grace period, with a higher rate in effect when the loan enters the repayment period. The fees charged by some lenders can increase the cost of the loan. A loan with a low interest rate but high fees can ultimately cost more than a loan with a somewhat high interest rate with no fees.

The lenders that do not charge fees often roll the difference into the interest rate. You will not have a problem finding nor attracting a lender for a private loan.

There are many lenders more than willing to lend you money even over the Internet without ever seeing you. The problem will be what you are willing to settle for and understanding all that is requested of you.

The best private student loans will have interest rates of LIBOR + 1.8% or PRIME- 1.00% with no fees. Such loans will be competitive with most federal loans. These rates often will be available only to borrowers with great credit who also have credit-worthy co-signers.