The APRs for variable rate loans, if listed, are only the current APRs and are likely to change over the term of the loan. Borrowers should be careful about comparing loans based on the APR, as the APR may be calculated under different assumptions, such as a different number of years in repayment. All else being equal, a longer repayment term will have a lower APR even though the borrower will pay more in interest.

The APRs for variable rate loans, if listed, are only the current APRs and are likely to change over the term of the loan. Borrowers should be careful about comparing loans based on the APR, as the APR may be calculated under different assumptions, such as a different number of years in repayment. All else being equal, a longer repayment term will have a lower APR even though the borrower will pay more in interest.

Discover is best known for its role as a top-four credit card network in the United States, but it does a lot more these days than helping you pay with plastic. In addition to a bank, Discover also grew to offer student loans at competitive rates. Variable rates range from 3.37 to 11.87% APR and fixed rates go from 4.74 to 12.99% APR. Loans come with 15-year or 20-year terms with no flexibility. Cosigner beware, there is no cosigner release available at Discover.


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There are some circumstances that may result in your no longer having to repay your federal student loan. For instance, some or all of your loan could be forgiven in exchange for your performing certain types of service such as teaching or public service. Or the obligation to make further payments on your loan might be discharged based on specific factors such as your school closing or your becoming totally and permanently disabled. Take a look at all the possibilities: Find out what circumstances qualify your loans for forgiveness, cancellation, or discharge.
When it comes to Stafford, Perkins, PLUS, and Direct Consolidation loans—which make up 85 percent of education debt—there are five repayment options. They range from the standard plan, which requires a minimum payment of $50 every month for up to 10 years, to the new, income-based plan that caps your monthly payments at a “reasonable percentage” of your income (determined by the federal government)and forgives any debt remaining after 25 years. So which schedule is best for you?
Generally, borrowers should prefer loans that are pegged to the LIBOR index over loans that are pegged to the Prime Lending Rate, all else being equal, as the spread between the Prime Lending Rate and LIBOR has been increasing over time. Over the long term a loan with interest rates based on LIBOR will be less expensive than a loan based on the Prime Lending Rate. About half of lenders peg their private student loans to the LIBOR index and about 2/5 to the Prime lending rate.
The other thing to consider with repayment is what your repayment term will be after you leave school. Most often, lenders will offer multiple term lengths ranging from 5 to 15 years, though some do offer longer terms. The longer your term, the lower your monthly payment will be, but the more your loan will cost over time, and vice-versa for shorter terms.
Private student loan volume grew much more rapidly than federal student loan volume through mid-2008, in part because aggregate loan limits on the Stafford loan remained unchanged from 1992 to 2008. (The introduction of the Grad PLUS loan on July 1, 2006 and the increases in the annual but not aggregate limits had only a modest impact on the growth of private student loan volume. The subprime mortgage credit crisis of 2007-2010, however, limited lender access to the capital needed to make new loans, reining in growth of the private student loan marketplace.) The annual increase in private student loan volume was about 25% to 35% per year, compared with 8% per year for federal loan volume.
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For example, you may see variable rates advertised as low as 2.5% APR and fixed rates starting around 3.9% APR. But this is a sunny day scenario. You and/or your cosigner would need to have the right qualifying credit score or credit factors to achieve the lowest rate, and the lender may impose requirements such as signing up for auto-debit from a checking or savings account to lock in these low rates. When comparing lenders, look for the asterisks and footnotes along with the fine print to understand what it takes to achieve or put you in the running for the advertised rates.
Student loan repayment assistance is a perk that more companies are providing given that most students carry debt into their careers. Although only 4% of companies offer this benefit now, it is the hottest benefit of the past year with 76% of people saying that student loan repayment benefits would be a deciding or contributing factor to accepting a job, according to the 2015 American Student Assistance survey. Employers usually pay $100 to $300 a month with many employers matching contributions up to $2,000 per year.
After completing your FAFSA, you’ll receive a financial aid award letter from the colleges you listed on the form. The timing on these letters can vary from college to college. However, if you’ve already received admissions acceptance from a college but no financial aid award letter, you can call their financial aid office to inquire about the letter’s status.
Discover is best known for its role as a top-four credit card network in the United States, but it does a lot more these days than helping you pay with plastic. In addition to a bank, Discover also grew to offer student loans at competitive rates. Variable rates range from 3.37 to 11.87% APR and fixed rates go from 4.74 to 12.99% APR. Loans come with 15-year or 20-year terms with no flexibility. Cosigner beware, there is no cosigner release available at Discover.
Generally, borrowers should prefer loans that are pegged to the LIBOR index over loans that are pegged to the Prime Lending Rate, all else being equal, as the spread between the Prime Lending Rate and LIBOR has been increasing over time. Over the long term a loan with interest rates based on LIBOR will be less expensive than a loan based on the Prime Lending Rate. About half of lenders peg their private student loans to the LIBOR index and about 2/5 to the Prime lending rate.
Variable Rates: Starting variable rates range from 3.65% to 11.25% APR (with autopay), and will never exceed 13.95% (sometimes lower in certain states as required by law). For variable rate loans, the variable interest rate is derived from the one-month LIBOR rate plus a margin of between 1.58% and 9.98%. The current one-month LIBOR rate is 2.27%. Changes in the one-month LIBOR rate may cause your monthly payment to increase or decrease. Interest rates for variable rate loans are capped at 13.95%, unless required to be lower to comply with applicable law.
Hi Michelle. Does your spouse have any student loans? If so, his/her loan debt can be taken into account when calculating your payment. Also, the new Revised Pay As You Earn Repayment Plan doesn’t require that you have a financial hardship, so you may qualify for that. Have you read this post: https://blog.ed.gov/2016/02/which-income-driven-repayment-plan-is-right-for-you/
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