How To Get a Student Loan for Online College

Around 61% of undergraduate students were enrolled in at least one online course in fall 2021, according to the National Center for Education Statistics (NCES). The NCES also reported that 28% of all undergrads, or 4.4 million students, took classes exclusively online.

Getting an online education has many perks. “Online college is a fantastic — and affordable — option for those who want to pursue a four-year degree, or even a master's degree while working or needing a flexible class schedule,” says Amanda Elliott, associate director of financial aid and student finance advising at Colorado State University Global.

Although online schools are often more affordable than in-person education, many students still need to borrow to attend. If you're one of them, this guide will help you learn how to get a student loan for online college.

Can you get student loans for online colleges?

Student loans are available for online colleges, as long as those colleges are legitimate educational institutions. For federal student loans, they must participate in Title IV federal student aid programs. One example is the William D. Ford Federal Direct Loan Program, which offers Direct Subsidized, Unsubsidized, PLUS, and Consolidation Loans.

“We would recommend making sure your online college is accredited to receive federal education funding. Institutions not accredited cannot process federally administered aid from the FAFSA,” explains Hillary Saylor Schulze, director of student financial services counseling at Alvernia University.

You can use the Federal Student Aid School Search tool or the College Navigator tool from the National Center For Education Statistics to see if the online program you're interested in participates in Title IV federal student aid programs.

Private student loan lenders should also make loans available for online schools, as long as those schools are accredited and award a qualifying degree.

Current private student loan rates

How to apply for federal student loans for online college

Applying for federal student loans for online colleges is simple and straightforward. “The best way to start is to fill out a FAFSA form to determine your eligibility,” advises Domenick D'Andrea, financial adviser and co-founder of DanDarah Wealth Management.

You can find the FAFSA online at StudentAid.gov, although you'll first need to sign up for a Federal Student Aid ID to complete it if you don't already have one. For the 2024-25 school year, the federal deadline to submit the FAFSA is June 30, 2025.

It should take less than an hour to complete the FAFSA, and you can consent to have your tax information automatically retrieved from the IRS to make completing the financial portion of the application much simpler.

Submitting the FAFSA can help you become eligible for several federal student loans, including:

• Direct Subsidized Loans: These are for undergrads with demonstrated financial need, and they offer affordable fixed interest rates. Interest is subsidized while you're in school and during periods of deferment. There are annual and lifetime loan limits, but your credit score doesn't impact eligibility.
• Direct Unsubsidized Loans: These are for undergraduate and graduate students, with no financial need requirement. There's no interest subsidy, but rates are fixed and typically lower than private student loan rates. These have higher loan limits than Direct Subsidized Loans, and credit isn't a factor in eligibility.
• Direct PLUS Loans: Parent PLUS loans are available for parents of undergrads, and grad PLUS loans are for graduate and professional students. As long as you don't have adverse credit, you can qualify to borrow up to your school-certified cost of attendance. Interest is not subsidized, and rates are a little higher than other Direct Loans.

Each of these loan types has specialized borrower benefits exclusive to federal loans, including access to loan forgiveness and income-driven repayment plans. As long as your online school is accredited and eligible for federal aid, any or all of them could be an option for you.

How to apply for private student loans for online schools

Taking out private loans for online schools can be more complicated than applying for federal student loans because the terms of the loans can differ substantially from one lender to another.

To apply for private student loans, you'll generally follow these steps:

• Obtain multiple rate quotes from different lenders: Make sure the lender provides financing for online schools, and pay attention to key information like interest rates and repayment terms.
• Check the lender's application requirements: If you don't meet credit or income requirements, consider applying with a cosigner.
• Submit an application: Individual lenders typically have online applications. You'll need to provide personal and financial information for yourself and your cosigner, if applicable.

Private student loans don't offer benefits like income-driven plans, but they don't usually charge origination fees, which federal loans do. And if you have strong credit, private loans can sometimes have more favorable terms. You can typically borrow up to the school-certified cost of attendance, minus other aid you receive.

Financial aid options for online college students

When you're attending school online, you want to borrow the least amount possible so you have less to repay when you graduate. You should explore all free sources of funding to help pay for your degree before turning to student loans.

“Scholarships are always worth looking into,” says D'Andrea. “These can take time to find and to apply for — I would start to investigate merit-based and then any organization that you are affiliated with.” You can use scholarship search sites like Fastweb to find scholarship opportunities. Before applying for a scholarship, be sure that it can be used to pay for online education.

Since flexible schedules are one benefit of attending online school, you may also be able to work while you earn your degree. If so, D'Andrea recommends looking for a job that offers tuition reimbursement.

“Some companies offer tuition-based financial assistance, which not only will save you money but will increase your importance to the company,” he says. “This can be a win for both you and the company that you work for.”

Elliott also suggests working with your school's financial aid office or finance advising team to explore these and other options.

Tips for managing student loans for online education

If you borrow to earn an online degree, you'll want to make sure you effectively manage your loans after graduation. Some tips to help you do that include:

• Set a budget: Be sure you can realistically fit your loan payment into your monthly budget. If possible, make extra payments on your debt to pay off your loans more quickly.
• Consider how best to prioritize payments: It can make sense to pay off loans with a higher interest rate first, which will typically be private student loans. If you have federal loans, you can also explore income-driven options to keep payments down, although these can lead to higher interest costs over time.
• Explore refinancing options: If you have private student loans, consider student loan refinancing to potentially get a lower interest rate. Reducing your interest rate can help you save money, but be careful about extending your payoff time, as this will increase your total costs. It's also best not to refinance federal student loans, as doing so will cause you to lose borrower benefits like access to loan forgiveness.