Discover student loans are a perfect back up for students whose federal loan isn’t enough to cater for their college costs in full. Also, discover offers refinancing options if you wish to lessen your repayment burden.
They do not charge any processing fees, and their interest rates are low and highly competitive, plus they have deferment as well as forbearance to their customers.
The company has attained great status in the market as one of the best when it comes to private or refinancing loans.
When you first apply for a discover loan, the company shall first check your credit report to ensure that you have an excellent score. If your score isn’t good enough, you shall not qualify for the loan, although you could still have a parent co-sign the loan with you.
This company currently on the credible platform that enables students to compare many loan providers and find one that offers them the best terms and lowest interest rates.
Discover Student Loans Rates and Terms
|Rates and Terms||Refinancing Loan||Private Loans|
|Time to Funding|
|Soft credit check?|
Discover Student Loans Requirements
Here are the main requirements for both refinancing and private loans:
|Minimum Credit Score|
|Must Have Graduated|
Discover Loan Products For Students
Discover usually works with your school to ensure that you only borrow what you need. They offer the following loan products.
Most students find that combining their federal loans with private loans works great for them because in most cases the federal loan is never enough.
Currently, they offer the following academic loans.
They offer undergraduate loans to students who are listed as qualified from having attended an accredited university or college at least part of the time.
There are various determinants to qualify for this such as repayment terms, interest rates, and fees.
- Variable interest rates – 4.12% – 11.87%
- Fixed APR – Between 5.49% and 12.99%
If you join the direct debit program, you shall qualify for a reduction of 0.25% discount on the interest rate.
This loan product covers college fees if you are in a professional field such as dental, medical, and MBAs.
They also cater for all other graduate programs as well. You can receive full financing for college, including room and board.
The loan is similar to the undergraduate loan but has a few differences such as giving borrowers a long grace period of nine months after graduation before you are required to start repaying the loan. Other loan products usually give just 6 months.
There is an option for repaying $25 each month while you are still a student in school, and you really do not need to have a co-signer, although you must have very good credit to qualify for a graduate student loan.
If you sign up for a direct debit, the company shall reduce your interest rate with 0.25%, and a further 1% reduction on the principal if you achieve a 3.0 GPA.
It has a repayment period of 20 years and the following interest rates;
- Variable Rate APR: 3.74% – 11.37%
- Fixed-Rate APR: 4.99% – 12.24%
Discover Residency Loans
Residency programs are usually for students who have completed medical school.
It is usually done in a hospital, and unfortunately, students are never paid enough during residency.
Discover understands this, and they have come up with a residency loan program that helps then take care of bills such as buying food, paying rent and other costs.
The loan takes care of plenty for the students such as the board review, the internship program, and relocation as well. The limits for this loan are;
A limit of $18,000 if you are in Allopathy, Dentistry, Optometry, Osteopathy, Veterinary Medicine or Podiatry pharmacy.
A $5,000 limit for everyone doing a residency for Physician Assistant, Nursing, and Physical therapy.
The repayment is 20 years and the interest rate is as follows;
- Variable Rate APR: 5.87% to 8.87%
- Fixed-Rate APR: 6.99% to 9.99%
Bar Exam Student Loans
If you are a law student, life is probably pretty tough right now.
Discover has a loan product specifically designed for law students to take care of their living expenses and other costs that are likely to stack up when studying for the bar.
They offer a limit of up to $16,000 for preparation of the bar exam, a 20-year term, and the following rates:
- Variable interest rate – 6.27% – 11.87%
- Fixed interest rate – 7.39% – 12.99%.
Discover Refinance Loans
Discover offers students the opportunity to consolidate their loans by taking out a new loan that can cover all of their current liabilities.
This is a great option because they have the lowest interest rates and a long repayment period of up to 20 years. You are allowed to make small monthly payments each month but at the expense of high-interest rates.
The company must, however, conduct a soft credit check before you qualify for the loan, and the lenders can receive up to $150,000. You, however, need to have a good credit score of at least 660 to receive the loan.
Pros & Cons Of Discover Student Loans
Before making a final decision, it’s important you’ll be aware of both the pros & cons. Let’s start with the benefits:
High Loan Amounts
If you are refinancing your loans using Discover, they shall give you up to a limit of $150,000 which is more than enough to cover all of your existing liabilities and then some.
This is just perfect for students who have become overwhelmed with their hefty loans.
On the other hand, their private loans usually cover all of your college attendance costs, which includes room and board, less any amount you may have received in form of federal loans.
The company motivates its students to achieve excellent results and repays them for it.
If you attain a 3.0 GPA or higher, you shall receive a cash reward from Discover that is equivalent to 1% of the loan they gave you.
For most people, this is motivation enough to work hard.
They service the loans by themselves without outsourcing to a third party, which has been known to cause tremendous problems for other lenders who do this.
They also have their inbuilt system of escalating customer concerns to serve them better.
Their application process is greatly simplified and does not involve too much work and requirements.
They also consider financing students who did not graduate so they can resume their studies.
Hard Credit Pull
Discover shall do a hard pull of your credit when identifying the rates you shall receive for your loan, and this adversely affects your credit score.
The best thing to do would be a soft check, just to identify the best rates for you, before they can issue the loan
Currently, they do not have a cosigner release program
It’s a huge disadvantage as it means that if you receive a loan through a cosigner, they shall be attached to that loan forever until you finish repaying it.
This causes most students to face difficulties when looking for someone to cosign the loans with.
Limited Repayment Options
They do not have a variety of repayment options as other lenders, which can be limiting in itself as most students would love some bit of flexibility when it comes to loan repayment.
The type of loan you receive will determine your repayment terms and period.
For undergraduate loans, the repayment is 15 years with 6 months grace period. This means that; if you are a student, you shall not be required to start repaying the loan until after six months are over.
All other Discover student loans including the graduate loan have a 20-year repayment period and 9 months grace period. The grace period for the residency and bar exam loans usually ends 9 months after you graduate.
All loans, except refinance loans have two options for repayment – deferment and in-school. While in school, you shall be required to pay $25 each month. But the deferred option does not require you to make any payments while still enrolled in school.
According to the BBB, – the Better Business Bureau, Discover has an A+ rating, which is the highest possible rate. This takes into account all complaints that the company has received and resolved. They have a recorded 900 complaints, and most of them have a response.
Their customer service department is available either on phone, email or fax, and their loan specialists can be found 24 hours each day. Simply call 1-800-STUDENT.
Discover student loans are excellent if you wish to have a long grace period. They have some of the best repayment options and for a private lender, they are at the top of their game.
Their rates are highly competitive and some of the best in the industry, and the additional incentives of reducing the interest rates with 0.25% when the student attains a GPA of 3.0 is great.
This is a lender who deserves your consideration if you are looking to get a student loan.