Compare Private Student Loans

compare private student loans

Private student loans could help pay for college. They may pay all or some of the expenses such as tuition and books. You may compare college student loans to find the perfect one that could cover expenses and can be repaid. Learn about how to compare private student loans with this helpful guide.

How Do You Compare Private Student Loans?

You may gather information about private loans from banks, credit unions, and online. Besides searching for lower interest rate, you can also consider a few other factors, such as origination or prepayment fees, repayment options, interest rate discounts and cosigner release policy. 

You should also find out if your lender has any borrower protections, such as forbearance and discharge options. Customer service and online features are another factor to consider. You could compare private student loan options based on eligibility and the following features: 

Interest Rates

Lenders need students to pay a fee for borrowing money. This fee is an annual percentage rate based on the loan’s unpaid principal amount.  The interest rate varies depending on the type of student loan. Lenders offer fixed rates or variable rates. According to the US Consumer Finance Protection Bureau, a fixed interest rate does not change over the life of a loan. A variable interest rate changes based on the index rate. Many variable and fixed rates may also vary over time. When you compare private student loans, try to choose the lowest interest rate they offer.

Loan Repayment Options

Lenders specify how long you could have to repay the loan. They may need in school payments while you attend school. They may offer several flexible repayment options to select from such as interest only or a flat fee. You may select the repayment option that best fits into your financial situation.

Some lenders could also provide a six month grace period or defer payment. You could wait a certain period after college to start making payments. No interest will add onto the loan for a deferment option.

Credit Score

Many college student loan lenders have credit requirements. If your credit history does not meet the standard, they may deny the loan. Some lenders may also post their credit score requirements. Others may not disclose these requirements before applying for the student loan.

Cosigner Rules

If you do not have a good credit history, the private lenders for college may request a cosigner. The cosigner who has a good credit rating could help you qualify for the college student loan. They may also take charge of repaying the loan if you miss a payment. 

A family member, relative, or spouse may cosign a loan. It is important to pick someone you trust to fill this position. A close friend may also cosign. Their income needs to cover the loan repayment amount. Some lenders may release the cosigner after receiving a certain number of repayments. Interest rates may vary for private student loans without one. The rates may also vary for private student loans for bad credit.

Loan Fees

Many lenders post loan fees. These loan fees may be application fees, origination fees or service fees. The fees are separate from the loan amount and interest rate. Loan fee amounts may vary. You should compare private student loans’ fees between each private student loan before you choose one. 

Be wary of companies that hide fees after the paperwork is signed. You may want to work with a company that is upfront about all terms and conditions. 

Forbearance and Discharge Options

According to the U.S. Department of Education, short term forbearance programs stop payments. You may not experience a penalty. Unlike deferred options, interest on the loan still accrues for this option.  A lender could also offer discharge options as you compare private student loans. Discharge options forgive the remaining unpaid balance based on certain circumstances. They may discharge the loan if the borrower dies or becomes disabled. Filing for bankruptcy may allow you to discharge loan payments.

Online/Customer Service

Getting in touch with the lender and getting information should be an easy process. Check how they provide customer service. See if they provide clear and concise answers to your questions.

The customer support should always be willing to help. They should resolve issues in a timely fashion. Companies offering customer support go out of their way to provide perks to loan borrowers. You should also compare these private student loan companies based on customer reviews. 

Which Private Student Loan Lender Should I Borrow From? 

Here is a list of lenders who provide student loans for college. We have provided basic information about the lender. You may use this as a starting point to compare private student loans.

Sponsored Listings 

Sallie Mae

Sallie Mae started as a government federal student loan lender. In 2004, the company became a public student bank offering private loans. Students may get a range of loan types to pay for college. Besides student loans, they also offer student credit cards. 

Student Loan Types: undergraduate, graduate, dental, law, medical, MBA, parent loans, medical/dental residency, bar study, health professional graduate loans, career training

Positive Features:

  • Loans provide 100% coverage for school certified expenses. compare private student loans
  • No origination fees
  • Many repayment plans
  • Only apply once to receive money for the entire school year

Drawbacks:

  • No options to change terms of the loan
  • Does not disclose credit requirements
  • Website lacks transparency on all eligibility requirements and repayment terms

Terms and Fees:

  • Offer both variable rate and fixed rate loans
  • No origination or application fees
  • Students become ineligible for repayment incentives if struggling to make loan payments
  • Charges a late fee percentage

Extra Features:

  • Cosigner accepted
  • Offers repayment programs but not listed on website
  • In school deferment options and a 6 month grace period are available
  • Forbearance is available for students serving in the military
  • Two reward programs
  • Online homework help is available
  • Customer service rated as great

Ascent

Ascent offers college student loans for graduate students and undergraduate students. Students may find these loans available in all 50 states. The company also has both non cosigned and cosigned loans.

Loan Types: undergraduate and graduate

Positive Features: 

  • Offers cash back graduation rewards if meeting certain criteria
  • Allows students to pay interest only or a flat fee on cosigned loans
  • Students may make full payments while in school and during the grace period
  • No origination, application, or prepayment fees

Drawbacks:

  • Does not offer parent loans
  • No student loan refinance is available
  • No degree specific student loans

Terms and Fees:

  • Repayment term periods are 10 year to 15 years for independent borrowers
  • Co signed loans have repayment term periods of 5 years, 10 years or 15 years
  • No application or origination fees

Extra Features:

  • Cosigners accepted
  • Offers specific cosigner loans
  • Has fixed rate and variable loans
  • Interest rate reduction and cash back awards are available
  • Deferred payments options available for cosigned and non cosigned loans
  • Repayment available for only cosigned loans
  • Administrative and temporary hardship forbearance are available
  • Releases cosigners if meeting certain conditions

Citizens Bank

Citizens Bank is the largest commercial bank chain in the United States. They have branches within 40 states. Many branch locations are in the New England, Midwest, and Mid Atlantic areas. They also offer 4 year student loans for those who are eligible.

Loan Types: undergraduate, graduate and parent

Positive Features:

  • Multiyear student loans with a credit check for later years
  • International students may qualify for a loan if they have a US cosigner
  • Citizen bank customers may get reduced interest rates for student loans

Drawbacks

  • Two year institutions do not qualify for student loans
  • No preapproval or instant applications
  • Hard credit inquiry performed for approval

Terms and Fees

  • Fixed and variable student loans are available
  • Loan limits will range from 5 years up to 15 years
  • There a no origination, application, or disbursement fees

Extra Features

  • Cosigners accepted
  • Repayment programs include full payment and interest only payment while in school
  • Deferred payments are available
  • Forbearance options are available with Firstmark loan servicer on a case by case basis

Discover

Discover has offered private loans for students since 2010. These loans are available for students attending over 2,400 universities and colleges. The college student loans may cover 100% of education related expenses.

Loan Types: undergraduate, graduate, law, MBA, medical residency, bar exam prep

Positive Features:

  • Small loan amounts are available for out of pocket and gap expenses
  • Cosigners accepted
  • No application, origination or lateness fees

Drawbacks: 

  • Prequalification is not available
  • Company does not disclose qualifying criteria before applying
  • Hard credit inquiry performed
  • Single loan period is only available

Terms and Fees: 

  • Offers both fixed and variable rates
  • A 15 year single loan term for undergraduates and 20 year term for graduates
  • A 10 year to 20 year term for loan consolidation
  • No application, origination, or loan fees

Extra Features: 

  • Cosigners accepted
  • Repayment programs include interest only payments and flat monthly payments while in school
  • Deferred payments with no in school payments required
  • Offers options for students experiencing financial difficulty
  • Loans forgiven if the main borrower becomes disabled or if they die
  • Students can earn a one time percentage award if earning at least a 3.0 GPA
  • Extra interest rate discounts offered for interest only repayment

Earnest

Earnest is an online student loan lender offering undergraduate loans and graduate loans. It has been in business since 2013. Students who apply may select loan conditions that can fund up to the full cost of education.

Loan Types: undergraduate, graduate, business school, medical school , law school

Positive Features: 

  • Students may pick out monthly payment
  • Students may choose their loan term length
  • Cosigner allowed for undergraduate and graduate loans
  • No application, origination, or late fees

Drawbacks: 

  • Must have a FICO score of at least 650
  • Part time students are not eligible for private loans
  • Earnest loans are not available in all 50 states

Terms and Fees: 

  • Both fixed and variable loan rates are available
  • Loan periods may vary from 5 years up to 20 years
  • School loans may cover up to 100% of certified cost of attendance

Extra Features: 

  • Cosigner acceptance is available
  • No prepayment penalties for repayments
  • Repayment programs include fixed payment, interest only payments, and principal and interest payments
  • Deferred payments are available
  • Forbearance payments are available
  • Loans discharged due to death or disability
  • Accounts in good standing may skip a payment every 12 months that will be repaid later
  • A borrower could get a nine month grace period

College Ave

College Ave has been in business since 2014 as they only offer student loans. Their private student loans are available in all 50 states. Borrowers may complete the easy student loan application on any device.

Loan Types: undergraduate, graduate, MBA, dental, medical school, law school, parent loans, career programs

Positive Features: 

  • Easy and fast application process
  • Completion incentive available for career program loans
  • No origination or prepayment fees

Drawbacks: 

  • Financial hardship aid determined on a case by case basis
  • Interest only payments required for parent loans while the student attends school
  • Deferment featuring no in school payment requirements is not available for parent loans

Terms and Fees

  • Offers variable and fixed rate loans
  • Loan periods from 5 years up to 15 years
  • Cashback rewards available when completing the program of study

Extra Features

  • Cosigners accepted
  • Repayment plans include interest only payments, flat payments, and principal and interest payments
  • Deferred payment options are available
  • Discharge and forbearance options may be available but the policies are not disclosed
  • Incentives and promotions offered
  • Customer service rating is great

SoFi

SoFi is an online lender that provides private student loans in all 50 states. It has expanded its financial offerings to include undergraduate, graduate and parent loans.

Loan Types: undergrad, graduate, law school, MBA, and parent loan part time

Positive Features: 

  • Online lending process
  • Long loan terms
  • All student loans eligible for refinancing
  • No origination, application, or late fees

Drawbacks 

  • No qualification criteria disclosed
  • Discharge of loan is a case by case approval
  • No credit score disclosure

Terms and Fees

  • Provides variable and fixed rate loans
  • Loan terms of 5 years, 10 years and 15 years
  • No origination fees, no late fees, and no insufficient funds fees 

Extra Features

  • Cosigners accepted
  • Repayment plans are immediate pay, partial pay, and interest only
  • Deferred payment options
  • Discharge options allowed for certain circumstances
  • Financial aid tool available 
  • Discounts for other loans are available
  • Customer service rating is great

Sponsored Listings 

What is the Difference between Federal Student Loans and Private Student Loans? 

The government offers federal student loans. Banks, state organizations, state affiliated organizations or credit unions usually offer private student loans for graduate school and undergraduates. Federal loan terms and conditions are typically set and governed by laws. Banks and other institutions may decide on the terms and conditions of private loans. 

Federal student loans have fixed interest rates. Private student loans may have variable or fixed interest rates. Both loan types may have repayment programs, although they differ. To apply for a federal student loan, you have to submit a Free Application for Federal Student Aid (FAFSA). Financial aid may be available for those who qualify. 

How Do I Qualify for a Private Student Loan?

Private student loan lenders may list their eligibility requirements and qualifications on their websites. So eligible students may understand their terms before filling out an application. You may qualify based on the following factors:

  • Be a U.S. citizen or permanent resident
  • Be enrolled in an eligible school at least half time or full time
  • Meet credit score requirements
  • Meet education and income requirements
  • If needed, have a cosigner who meets requirements 

Can You Get Private Student Loans Forgiven?

Many private lenders do not forgive student loans. Some state agencies may offer forgiveness depending on the circumstances. An alternative to loan forgiveness may involve enrolling in a repayment help program. You may also get refinancing or merge loans.

Can You Consolidate Private and Federal Student Loans?

Yes. You may merge private and federal college loans to make it easier to repay them. The Direct Consolidation Loan allows students to combine all federal loans. Some private lenders offer consolidation loan programs while others may only refinance loans. You may not join private loans with a federal consolidation program. You may merge private and federal loans together with a private lender. Yet, you could lose out on certain federal benefits. 

Are Private Student Loans Dischargeable?

Yes. Banks may discharge student loans may depending on certain circumstances. To qualify, a student could have to prove some type of financial hardship. A borrower’s death or a permanent disability may result in a loan discharge. 

Filing for bankruptcy may also result in a loan discharge. The student may need to show that continuing to pay for the student creates undue hardship. The amount of the loan discharge may vary. Financial institutions may also discharge all the loan amount or only part of the loan.

Can You Refinance Private Student Loans?

Yes. Students may seek private loan refinancing. There are several reasons a student may change the term of their loans. A student may seek lower interest rates. Another financial institution may offer better repayment plans for your loans. You may also seek this option to merge loans under one monthly payment. You could also switch to a different lender if you do refinance.

Some lenders offer this option. You may speak with the lender who is currently managing your college student loans. Yet keep in mind that they may charge fees for originating loans. You may not transfer private student loans to the federal government. Yet federal student loans may become private student loans. You may lose program benefits when changing a federal student loan into a private one. 

Federal loans come with benefits that are not offered in private student loans. Benefits that you may lose include principal rebates or interest rate discounts. You may also lose loan cancellation benefits.

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