When it comes to affording higher education, student loans are often unavoidable. In fact, approximately 70% of students use loans to help pay for their education.
The thought of finding the right lender, in a world that already feels overwhelming with options, can be daunting.
Lucky for you, we’re breaking down the 10 legit student loan lenders in the USA, so let’s dive in and explore your options!
A Little Bit About Student Loans
First things first, let’s understand the basics of student loans. Student loans fall into two primary categories:
- Federal loans: Government-funded loans with lower interest rates and flexible repayment options. They usually don’t require credit checks but do require filling out the Free Application for Federal Student Aid (FAFSA).
- Private loans: Loans provided by private institutions like banks, credit unions, or lenders. These typically have higher interest rates and are more dependent on your credit score.
Now, let’s shift our focus to the 10 legit student loan lenders you’ve been waiting for.
10 Legit Student Loan Lenders in the USA
Sallie Mae:
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- Offers undergraduate, graduate, professional, and career training loans
- Loan amounts: $1,000 up to the cost of attendance
- Repayment terms: 5 to 20 years
- Interest rates: competitive rates, depending on credit approval
- Key takeaway: No prepayment penalty or origination fee making it a great choice
Discover Student Loans:
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- Provides undergraduate, graduate, professional, and career training loans
- Loan amounts: Up to 100% of the cost of attendance
- Repayment terms: 15 to 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Comes with outstanding rewards for good grades
SoFi:
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- Offers undergraduate, graduate, and parent loans
- Loan amounts: $5,000 to the cost of attendance
- Repayment terms: 5, 10, or 15 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Offers additional perks like career assistance and networking events
College Ave:
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- Provides undergraduate, graduate, and parent loans
- Loan amounts: $1,000 to the cost of attendance
- Repayment terms: 5 to 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Offers customizable repayment plans based on your needs
Earnest:
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- Offers undergraduate, graduate, and parent loans
- Loan amounts: $1,000 to the cost of attendance
- Repayment terms: 5, 10, 15, or 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Allows for biweekly payments to help reduce interest costs over time
CommonBond:
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- Provides undergraduate, graduate, and dental/medical loans
- Loan amounts: $2,000 to the cost of attendance
- Repayment terms: 5 to 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Supports social causes by funding education for children in need
LendKey:
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- Offers undergraduate and graduate student loans
- Loan amounts: $1,000 to $300,000
- Repayment terms: 5 to 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Connects borrowers with community banks and credit unions
Laurel Road:
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- Provides loans to graduate students, primarily in medical and dental fields
- Loan amounts: $5,000 to the cost of attendance
- Repayment terms: 5 to 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Offers excellent refinancing options for healthcare professionals
Citizens Bank:
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- Offers undergraduate, graduate, professional, and parent loans
- Loan amounts: $1,000 to $350,000, depending on the degree
- Repayment terms: 5 to 20 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Offers multi-year approval, allowing borrowers to secure funding for future years
PNC Bank:
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- Provides undergraduate, graduate, and health professions loans
- Loan amounts: $1,000 up to the cost of attendance
- Repayment terms: 5 to 15 years
- Interest rates: competitive fixed and variable rates
- Key takeaway: Offers various repayment assistance options for struggling borrowers
Things to Remember
- Compare interest rates, fees, and repayment terms
- Understand both fixed and variable interest rates
- Read the fine print to understand terms and conditions
FAQ
What’s the difference between federal and private student loans?
Federal loans are funded by the government, typically have lower interest rates and more flexible payment options. Private loans are provided by private lenders, banks, or credit unions and usually, have higher interest rates.
How much can I borrow?
Undergraduates can borrow $5,500 to $12,500 per year in Direct Subsidized Loans or Direct Unsubsidized Loans, depending on certain factors like year in school. Direct PLUS Loans can also be used for the remaining college costs, as determined by the school.
When do I start repaying my student loans?
Most federal student loans provide a six-month grace period after you graduate, leave school or drop below half-time enrollment. For private student loans, it depends on the terms of your loan agreement.
What is a subsidized loan?
Subsidized loans are federal student loans designed for eligible undergraduate students who demonstrate financial need, and they don’t accrue interest while you’re in school.
What’s a student loan servicer?
A student loan servicer is a company that manages loans, including billing and other services on behalf of a lender.
Can I pay off my student loans early without any penalty?
Yes, both federal and private student loans can usually be paid off early without penalties.
What’s a loan rehabilitation program?
Loan rehabilitation is a federal program to help borrowers get their student loans out of default and back into good standing.
Do I need a cosigner for my student loan?
For most private student loans, a cosigner is required, particularly if you’re an undergraduate student or don’t have a consistent income or good credit.
Is it better to make smaller payments more often?
Yes, generally making smaller but more frequent payments can decrease the amount of interest that accrues.
Can I qualify for student loan forgiveness?
Yes, you can qualify for student loan forgiveness programs under certain conditions with federal loans, like working in a public service job. Private lenders usually do not offer these programs.
Final Verdict
There is no one-size-fits-all solution when it comes to student loans, as individual situations and requirements vary. Understanding the options and conducting thorough research can help you find the right lender for your educational journey. Remember, these loans are an investment in your future, so choose wisely!
