State and Private Loans

Private/Alternative Loans

Private/Alternative loans are credit-based educational loans through private banks or lending institutions. The terms for each loan are different per lender so it is important to thoroughly research the terms of each loan to find the one that best meets the needs of the borrower. Although the application process begins with the lender, these loans require school certification and are disbursed to the student through the SMU student account.

The Higher Education Opportunity Act of 2008 prohibits schools from recommending or advising students or families on lender selection. However, SMU conducts a public, open request for information (RFI) and utilizes a neutral comparison tool called ELM Select to compile a list of private lenders offering educational loans. To view the list of lenders, available loans, options and terms, repayment benefits, and applications websites, please launch the lender list below. 

Launch Lenders List

State Loans 

The Texas College Access Loan (CAL) is administered by the Texas Higher Education Coordinating Board (THECB). This loan is available to students who meet the Texas residency requirements for financial aid. Students who wish to utilize this loan must submit their application directly to the state for credit check. If approved, the state will notify SMU and proceed with the certification process. 

If you would like to determine if you meet the requirements for residency prior to submitting your application, please contact the Financial Aid Office at enrol_serv@smu.edu for information and instructions. 

Disbursement of State and Private Loan Funds 

Federal law mandates a minimum waiting period of eleven business days before authorizing the disbursement of state or private educational loan funds. This “right-to-cancel” period can vary per lender, but typically begins after the borrower signs the Loan Approval Disclosure (sometimes referred to as the Final Loan Terms). Be sure to include the eleven-business day waiting period when planning for bill payment.

Understanding the Process and Timeline

Applying for a Loan
  • Getting pre-approved for a certain loan amount by the lender, based on your or your co-signer’s credit score, DOES NOT mean that SMU can certify the loan for the same amount.
  • Your Financial Aid Advisor must determine the amount of the pre-approved loan total that will fit in your financial aid award package for the year or the desired loan period; i.e., academic year or term (Fall-Spring, Fall only, Spring only, Summer, etc.).

CAL (State Loan Program)

Private Loans
  • CAL loan approval requires completion of the TX Core Residency Questionnaire (TXCORE) - either through verifymyfafsa.smu.edu or by submitting the paper form.
  • Please read the requirements of the lender with whom you are applying. Each lender has unique requirements both for application and for repayment.

Loan Approval Disclosure (LAD)/Loan Consummation Disclosure/Final Loan Terms
  • After SMU completes certification of loan, the lender finalizes the loan terms (amount, loan period, repayment, etc.) and sends the finalized terms to the student and co-signer (if applicable).
  • The document containing finalized terms is called either Loan Approval Disclosure (LAD), Loan Consummation Disclosure, or Final Loan Terms.

CAL (State Loan Program)

Private Loans
  • Students can submit LAD electronically if they completed their application on helmnet.thecb.state.tx.us with their TX driver’s license.
  • If student did not apply with TX driver’s license, students must physically sign LAD and mail it back to THECB.

*please click here for example of CAL LAD letter
  • Lender notifies student electronically that 1) school certification is complete, and 2) that they can login to their account on lender website to electronically accept the LAD.

Disbursement: 11 Business Day Right-To-Cancel Period & Release of Funds
  • Federal law mandates that a lender hold loan funds for an 11 business day right-to-cancel period prior to releasing them to the educational institution.

CAL (State Loan Program)

Private Loans
  • The TX Higher Education Coordinating Board starts the 11 business day period AFTER student has signed and submitted LAD.
  • Once this period ends, THECB releases funds to SMU. Please allow 1 business day for the funds to be posted to the student’s account.
  • Private lenders start the 11 business day period at varying times, depending on their in-house policies. Some lenders start once they grant credit pre-approval, some when LAD.
  • Once this period ends, the private lender releases funds to SMU. Please allow 1 business day for the funds to be posted to the student’s account.

CAL Loans

OVERALL TIME: up to 3 weeks from credit pre-approval to disbursement.

AFTER PRE-APPROVAL: estimated time per step is 2-4 business days (except for right-to-cancel period). Student must respond to certification questions from staff and submit LAD to prevent delays.

Private Lenders

OVERALL TIME: 3-4 weeks from credit pre-approval to disbursement.

AFTER PRE-APPROVAL: estimated time per step is 2-3 business days (except for right-to-cancel period). Student must respond to certification questions from staff and submit LAD to prevent delays.