Can Student Loans Be Used for Rent?

College tuition is rising, but room and board are expensive, too—students who live on campus at a public four-year institution pay an average of $11,520 annually for room and board. At a private four-year institution, the cost is $13,028. Rental costs off-campus run around $11,300 annually.

If you’re unsure how to cover these costs and wonder, “Can I use student loans for rent?” this article will explain how and when you can use your student loans for rent and living expenses.

Can I use student loans for rent?

Student loans are intended to help students pay for tuition and living expenses, and renting an apartment counts as living expenses while you’re in school. Therefore, you can use student loans to pay rent.

Can I use federal student loans for rent?

Federal student loans can cover rent while you’re in school. However, there are limitations to consider. For example, your total loan amount cannot exceed your school’s listed cost of attendance (COA). 

The Higher Education Act lists what costs schools should include in their total COA, but each school gets to determine its rates. Once you’re approved for federal student loans, the government will send your loans directly to your school to pay for your COA. Any money left over will be disbursed to you.

Most schools will have a COA for off-campus housing if you rent an apartment off-campus. For example, the Office of Student Financial Aid at the University of Maryland lists cost of living estimates for on-campus housing, off-campus housing, and living with parents. 

Remember that while using federal loans to pay rent is allowed, using federal student loans to pay a downpayment on a house is not. It’s also important to find a place to rent that you can afford—using student loans to rent an apartment above your means creates unnecessary extra student loan debt.

Can I use private student loans for rent?

Private student loans offered by banks, credit unions, and online lenders can also be used to pay rent. However, some private lenders require you to make payments while in school, so consider that when determining your living costs and overall budget. 

Private student loans can have fixed or variable interest rates, which are typically higher than federal student loans. To qualify, you also often must meet specific credit criteria or have a cosigner with a good credit history. 

If you need more student loans besides your federal student loans, or you don’t qualify for federal student loans, there are several private lenders to consider to help cover rent costs. Here are our recommendations: 

Lender	Rates (APR)	LendEDU rating
College Ave	4.39% – 16.85%	5/5
Sallie Mae	4.50% – 16.70%	4.8/5
Earnest	4.11% – 15.90%	4.7/5
Ascent	9.16% – 15.22%	4.4/5

College Ave – Best overall

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LendEDU rating: 5 out of 5

• Student loans for undergraduates, graduates, parents, and career training
• Choose your repayment term
• 4 in-school repayment options

College Ave stands out for its comprehensive range of loans, which can be used for living expenses such as rent. This makes it ideal for students who need financial support beyond tuition. 

The company’s flexible repayment terms, ranging from five to 15 years, and various in-school repayment options (full, interest-only, flat fee, and deferred) allow borrowers to tailor the repayment to their needs, easing their financial burden after graduation.

College Ave doesn’t have minimum enrollment requirements, and its application process is quick—you can complete it in about three minutes. Its Multi-Year Peace of Mind® lets you receive future loans at better approval odds, and College Ave allows borrowers to apply for an additional six-month grace period.

However, College Ave doesn’t allow borrowers to prequalify with a soft credit check, meaning the application will affect their credit score. It also doesn’t allow cosigner release until halfway through repayment, which is longer than several competitors offer.

Sallie Mae – Best for cosigners

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LendEDU rating: 4.8 out of 5

• Cosigner release after 12 months of consecutive on-time payments
• Loans can cover both tuition and living costs, including rent 
• Get a decision within 15 minutes

Sallie Mae’s cosigner-friendly approach makes it an attractive choice for students who may lack a credit history or income. 

This feature enables them to secure funding with the help of a family member or trusted individual—and your cosigner will love that they can be released from their financial responsibility for your loan once you make 12 on-time consecutive monthly principal and interest payments. 

Sallie Mae’s various repayment options, including deferred, fixed, and interest-only, provide additional flexibility. Plus, you can get lower rates if you choose to begin repaying your loans while in school rather than defer payments.

However, Sallie Mae doesn’t offer a soft credit check, and its shortest repayment term is 10 years, which may not be ideal for those who want to repay their loans as soon as possible.

Earnest – Best for no fees

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LendEDU rating: 4.7 out of 5

• No origination, late payment, application, or prepayment fees
• Ability to skip one payment per year
• Check your rate without affecting your credit

Earnest’s no-fee policy is an advantage for students. It eliminates origination, application, and late fees, which can otherwise increase the overall cost of borrowing. This makes Earnest a budget-friendly option for students who need loans for tuition and living expenses, including rent.

Earnest provides comprehensive funding solutions that cover tuition and living expenses. The customizable repayment options, including the ability to choose monthly payment amounts and repayment terms from five to 15 years, give borrowers the flexibility to tailor their loan repayment to their unique financial situation.

Earnest’s nine-month grace period is longer than many other lenders, and the option to skip a payment without penalty can come in handy if your budget is tight. You can check your eligibility in two minutes without impacting your credit score. 

However, Earnest doesn’t allow cosigner release, requires borrowers to be enrolled at least half-time, and its loans aren’t available in Nevada.

Ascent – Best for deferred payments

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LendEDU rating: 4.4 out of 5

• Offers non-cosigned loans based on credit or future earning potential
• 1% cash back at graduation
• Easy application process

Ascent’s unique approach to eligibility allows students to qualify based on credit or future earning potential without needing a cosigner, making it accessible to a wider range of students. 

This flexibility is valuable for those with limited credit histories or a qualified cosigner, ensuring they can secure the funding they need. 

Ascent’s loans cover tuition and living expenses, including rent, making it a comprehensive solution for students needing financial support for all aspects of their education. 

The variety of repayment options, including deferred, interest-only, and full repayment, allows students to choose a plan that suits their current and future financial situations, providing peace of mind.

Ask the expert

Chloe Moore

CFP®

While student loans can be used for room and board, including rent, consider the cost of attending college and find ways to reduce rent expenses so you don’t take out more loans than necessary. You can reduce your housing costs by staying at home with your parents (if possible), living with roommates who can split the rent, and shopping around to compare rental rates. 

How to apply for student loans

Remember to always exhaust all of your federal student loan options before looking into private student loans. Federal student loans typically have lower rates and several repayment benefits not available with private loans, including income-based repayment and student loan forgiveness. 

Here are the steps to apply for student loans, whether you apply for federal or private student loans. 

1. Determine eligibility (one to three days)

To get federal student loans, you must meet basic eligibility criteria, such as a valid Social Security number.

The requirements to qualify for private student loans will vary by lender, but you’ll generally have good credit or an eligible cosigner with good credit and steady income.

2. Complete an application (one to three days)

Any student who wants to apply for federal student loans must complete the Free Application for Federal Student Aid (FAFSA). If you’re a dependent student, you’ll need to collect personal information about your parents to complete the FAFSA.

Unlike federal student loans, where all qualifying colleges can view the same FAFSA, each private lender will have an application. To apply for a private student loan, gather your documents first to speed up the process. 

3. Wait for your offer (days to weeks)

Your FAFSA application only takes a few days to process, and once it is, you can log online to make sure your information is correct. 

However, colleges usually send out financial aid offer letters with acceptance letters. So, if you apply to schools and submit your FAFSA in the fall, you might have to wait until Spring to determine the total cost of your education and living expenses.

Private student loans are a little different. Depending on the lender, you can determine your loan decision in a few days to weeks. 

4. Accept and receive funds (weeks to months)

It will only take a day to officially accept your federal student loan agreement. However, funds are typically distributed at the beginning of the semester. So, depending on when that is, you might have to wait a few weeks to receive excess funds.

Private lenders send your loan money to your school or directly to you. Check with your lender to find out their policy and how quickly you can receive your funds.

Recap of private student loans for rent

Lender	Rates (APR)	LendEDU rating
College Ave	4.39% – 16.85%	5/5
Sallie Mae	4.50% – 16.70%	4.8/5
Earnest	4.11% – 15.90%	4.7/5
Ascent	9.16% – 15.22%	4.4/5