Fees

Private loans often carry an origination fee. Origination fees are a one-time charge based on the amount of the loan, they can be taken out of the total loan amount, or added on top of the total loan amount, often at the borrower's preference. Some lenders offer low-interest, 0-fee loans; but these are usually available only to those with high credit scores of 800 or more. Each percentage on the front-end fee gets paid once, while each percentage point on the interest rate is calculated and paid throughout the life of the loan. Origination fees are changing per the Higher Education Act (HEA) July 1, 2006 and the source of payment of the 1% mandated fee may vary by lender.