Many undergraduate student loans are federal loans issued through the government. But if you needed extra funds while pursuing your education or you earned an advanced degree, there’s a good chance you may also have one or more private loans in your borrowing mix.
Knowing what kind of student loans you have can help you stay up to date with your payments and also ensure that you’re aware of any benefits and relief programs that may be available. Read on to learn how you can tell which student loans are federal and which are private.
Key Points
• Identifying student loan types is important for managing payments and accessing federal benefits.
• Federal student loans offer flexible repayment options, including income-driven plans, while private loans generally do not.
• Federal loans have fixed interest rates set by Congress, whereas private loans have fixed or variable rates set by lenders.
• Federal loans provide benefits like deferment, forbearance, and forgiveness programs, which private loans typically lack.
• Federal loans can be consolidated into a Direct Consolidation Loan, while private loans can be refinanced.
• Resources for identifying student loan types include the Federal Student Aid (FSA) website, the lender, and the borrower’s credit report.
Characteristics of Federal Student Loans
Federal student loans are issued through the Department of Education (DOE), while private student loans are from banks, credit unions, and other private lenders, including online lenders.
For most student borrowers, federal loans are the better choice to start with. They typically come with lower interest rates, and the rates are fixed, so they won’t fluctuate. Undergraduate students are eligible for federal loans without undergoing a credit check, and they typically won’t need a student loan cosigner. And federal loans offer a variety of flexible repayment plans, with the option to pause or reduce payments if necessary. Borrowers may even qualify for a student loan forgiveness program.
Federal PLUS loans for parents and graduate students involve a credit check, and a borrower cannot have an adverse credit history, but these loan programs also have advantages that can be attractive to borrowers, including a choice of repayment plans.
Chances are, if you’re wondering “are my student loans federal or private?,” it’s likely you have at least one federal loan. As of the second quarter of 2024, more than 92% of student loan debt in the U.S. was owed on federal loans. The remaining amount was owed on private student loans.
How to Check Your Federal Student Loan Status
When you’re trying to determine the status of your federal student loans, the Federal Student Aid (FSA) website, StudentAid.gov, can be a good place to start. Log in using your FSA ID and go to the “My Loan Servicers” section on your dashboard to get a list of all the federal student loans in your name. The site also lists contact information for various loan servicers such as Edfinancial and Nelnet, if you need more details about your loan.
You also can access your loan information by using the FSA’s National Student Loan Data System (NSLDS), which tracks federal financial aid through the loan approval, disbursement, and repayment process. Or you can call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243.
Common Federal Loan Types
What student loans are federal? One of the most common types is federal Direct loans. The different kinds of Direct loans include:
• Direct Subsidized: This federal loan for undergraduate students is need-based. The government pays the interest while borrowers are in school and during the six-month grace period after graduation.
• Direct Unsubsidized: Any undergraduate or graduate student may qualify for this loan (up to a lifetime borrowing limit); it is not based on need. However, the interest on Direct unsubsidized loans accrues while borrowers are in school.
• Direct PLUS: These loans are for graduate and professional students, or the parents of undergraduate students. A credit check is required to be approved for a Direct PLUS loan.
• Direct Consolidation: A consolidation loan allows you to combine one or more federal student loans into one new loan. You’ll make one payment each month, and consolidation could help to reduce your loan payment amount — though it could also extend your loan term.
If you have an older federal student loan, it might be a Perkins Loan, a Federal Family Education Loan (FFEL), or a Stafford Loan. These borrowing options were discontinued a number of years ago and are no longer available, but if you had one of them, it should still be listed on your FSA dashboard.
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Differences Between Federal and Private Loans
Both federal and private student loans can help you cover the costs of attending the college of your choice. But there are significant differences between them. Federal student loans, which are funded by the government, tend to offer the best rates and terms, and they come with federal benefits and protections like income-driven repayment plans and forgiveness options. Private loans don’t offer those same benefits and protections, and their interest rates are often higher.
Federal loans do have borrowing limits, however, which means students may find it necessary to turn to private loans to fill a gap in their financing. So if you hit the limit on your federal student loans at some point, it’s possible you also took out a loan from a private lender.
Here’s a closer look at how federal vs. private student loans compare:
Interest Rates
The interest rates on federal student loans are set by Congress each year and they’re fixed. Once you take out a federal loan, your interest rate remains the same for the life of the loan.
Private lenders can set their own interest rates and other loan terms. Rates may be fixed or variable and can depend on several factors, including your credit score (or the score of your student loan cosigner), loan amount, and repayment term.
Repayment Plans
Federal student loan borrowers can choose from several different federal repayment plans, including income-driven repayment plans. You can defer payments on a federal loan if you’re enrolled at least half-time, and you’ll have a six-month grace period once you graduate.
The time limit for paying off student loans varies. Under the Standard Repayment Plan, borrowers repay their student loans over a period of 10 years. On some income-driven repayment plans, however, the repayment period may be extended to up to 20 or 25 years.
With private loans, repayment plans are determined by the individual lender. Some of them may allow a borrower to defer payments while in school and for six months after graduating. Private lenders also typically offer multiple repayment terms, which can range from five to 20 years.
Deferment and Forbearance Options
Borrowers can apply for student loan deferment or forbearance if they are having trouble repaying their federal student loans. Although interest on the loans will likely continue to accrue, you may be able to temporarily postpone or lower your payments.
Some private lenders also may offer a variety of hardship options to help borrowers who run into financial difficulties while repaying their loans. Check with your lender to see what might be available for your circumstances.
Loan Forgiveness
Only federal student loans are eligible for student loan forgiveness through Public Service Loan Forgiveness (PSLF) and other federal programs.
Private loans aren’t covered under federal forgiveness programs, and private student loan forgiveness is rarely an option.
Consolidation and Refinancing
Federal student loans can be combined into a Direct Consolidation Loan, which combines federal student loans into one new loan with one monthly payment. The new loan will likely have a lower interest rate — but you can also expect to have a longer repayment period. If you decide to go this route, it’s important to be aware of all the pros and cons of student loan consolidation.
Private student loans cannot be consolidated into a Direct Consolidation Loan, but they can be refinanced, ideally with a lower interest rate if you qualify. With student loan refinancing, you replace your old loans with a new loan that has a new interest rate and terms. It’s possible to refinance federal loans as well as private loans, but it’s important to understand that when you refinance federal loans you will lose access to federal loan forgiveness, deferment, and repayment options.
Taxes
Interest on both federal and private loans may qualify for a student loan tax deduction. Qualified student loan borrowers may take a deduction of up to $2,500 in interest they paid for the year out of their taxable income.
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Resources for Identifying Your Loan Type
To figure out what type of loan you have, log into your account at StudentAid.gov. On your dashboard you should see any federal loans you’ve borrowed in the section called “My Loan Servicers.”
There is no similar centralized website for private loans, so you’ll need to do a bit more detective work. Pull out the billing statement for your loan, and contact the lender at the number or email listed there. Ask them what type of loan it is and get any other information you need about repayment.
What to Do if You’re Unsure About Your Loan Type
If you are still uncertain whether you have a federal or private student loan, there are a few different strategies you can use to help identify the type of loan it is. Try one or more of the following methods.
• Check StudentAid.gov. If your loan isn’t listed on your dashboard on the FSA website, it’s probably from a private lender. If your loan is federal, the site can help you find all your loan details — including the type of loan or loans you have, your loan amount, interest rate, status, and the outstanding balance.
• Contact your lender. You can reach out to a lender directly by calling the phone number on your billing statement.
• Contact your school. Because student loans are typically disbursed directly to your college, the school’s financial aid office may have a record of where your loan came from and whether it’s private or federal.
• Check your credit report. Your credit report will list all of your active credit accounts — including any student loans you have and who the lenders are. You can then contact the lender to find out if the loan is federal or private.
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The Takeaway
If you’re not sure what type of student loan you have, there are several resources available that can help you determine whether you have federal or private student loans, including the FSA website, your college, and your lender.
Identifying your student loans is important because it can help you manage and stay on top of your payments. Plus, knowing that you have federal loans could assist you in tapping into repayment plans and forgiveness programs should your situation warrant it.
For instance, if you’d like to simplify and lower your monthly student loan payments, you could explore a Direct Consolidation loan for your federal loans. If that’s not the right option for you, or you have private loans, you may want to consider student loan refinancing.
Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.
FAQ
Can I have both federal and private student loans?
Yes, it’s possible to have both federal and private student loans. Many borrowers first take out federal loans, but they may need private loans to fill the gap when they hit the funding limits on their federal loans.
Where can I find information about my federal student loans?
The Federal Student Aid (FSA) website, StudentAid.gov, is a good place to start when you’re looking for information about your federal student loans. Log into your account using your FSA ID and you’ll find a list of all the federal student loans in your name by going to the “My Loan Servicers” section of your dashboard.
What if I can’t remember which loans I took out?
You can check your StudentAid.gov account to get details about any federal student loans you have. You can also find information about your loans by checking your billing statements for the lender’s name and information and then contacting them directly. Other options include calling your school’s financial aid office to see if they have information about your loans, and checking your credit report for the lender’s name.
Do all government loans count as federal student loans?
Federal student loans are funded by the government. If you have a student loan from the government, it is likely to be a federal student loan. Federal student loans include Direct Subsidized loans, Direct Unsubsidized loans, and Direct PLUS loans.
How do repayment options differ for federal vs. private loans?
Repayment options for federal student loans tend to be more flexible. For instance, if you have a federal student loan, you could choose an income-driven repayment plan that bases your monthly payment on your income and family size, among other choices. With private student loans, the terms and repayment options are different for each lender, but income-driven repayment plans are generally not offered.
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