After you’ve maximized federal and institutional financial aid, grants, and scholarships, it’s time to start exploring private student loans. Make sure to shop around and look for the best deal possible before borrowing money from a private lender.
Of course, with dozens of lenders with different eligibility criteria, rates, and repayment terms, shopping around is easier said than done. This is where LendKey comes in handy.
Here are 6 things you should know about LendKey student loans.
How LendKey Works
LendKey works differently from most other private student loan companies. Rather than acting as a lender, they connect prospective student borrowers with best-matched lenders from their network of credit unions and community banks.
Filling out a quick application with your personal and financial details will give you access to hundreds of credit unions and community bank partners that offer affordable student loans.
After you submit the application, you are provided with a list of relevant lenders based on factors such as your financial needs and the lender’s eligibility requirements. This saves you hours researching the terms and conditions of one lender at a time.
What Sets LendKey Apart
While there are other platforms that offer similar loan comparison services, LendKey has some unique features that make them stand apart from their competitors.
Firstly, the lenders in LendKey’s network are mostly smaller, local banks and credit unions. The advantage of using these smaller lenders is that you will get access to more competitive interest rates and better deals than what you would get through larger lending institutions. This can save you a substantial amount of money from the start.
Another benefit of using LendKey is that they also service loans that are processed through their online portal. When you apply for a loan through LendKey, you can select your repayment options and also make your payments through their platform. This gives you an added level of convenience and protection that you may not otherwise benefit from when dealing directly with a smaller lender.
To qualify for a LendKey student loan, you must meet these requirements:
- Be 18 years or older
- A citizen or permanent resident of the U.S
- Enrolled in school at least half-time
- Have minimum credit score of 660 to apply without cosigner
Rates & Fees
As mentioned earlier, LendKey offers some of the most competitive interest rates on student loans. Borrowers can choose from fixed and variable rate loans.
If you have little or no credit history, having a creditworthy cosigner can increase your chances of getting approved for a student loan. Having a cosigner may also qualify you for lower interest rates.
LendKey does not charge any loan origination or processing fee. They also do not charge any prepayment penalties. So if you can pay off your loan early, you won’t be charged for it. This can help you reduce the cost of your loan significantly if you decide to start making payments while you are still in school.
In addition, you also get 0.25% off the quoted interest rate if you sign up for automatic payments. If you meet certain conditions, you may also qualify for a further 1% reduction in interest rates after you’ve paid off 10% of the loan amount.
Repayment Plans & Protections
LendKey offers repayment terms ranging from 5 to 15 years. This allows you to choose a repayment term that is best suited for your short and long term financial goals.
Borrowers also benefit from unemployment protection. This can come as a real relief since you will be able to defer loan payments for a time if you become unemployed.
Online Loan Application
LendKey accepts applications from undergrad students, grad students, parents of students, and parents of graduates.
The entire loan process is completed online. Filling out the online application takes just a few minutes. After submitting, you will get a list of lenders that are a good match for you. You can then compare each lender’s terms, conditions, and interest rates, and choose one that works best for you.
After you’ve finalized your choice of lender, you then sign the promissory note and complete the other formalities.
You need to have a credit score of 660 or more to apply without cosigner. If you have not had a chance to build your credit history, you will need to get a cosigner to qualify for a student loan through LendKey. If your cosigner has a good credit score, you may even be able to get a lower interest rate on your student loan.
Most people are reluctant to cosign student loans, because they are ultimately responsible for the loan if you default. LendKey minimizes the risk for the cosigner by allowing borrowers to release their cosigner after making 24 consecutive on-time payments.
Should You Consider a LendKey Student Loan?
Highly competitive rates from banks and credit unions, a range of repayment options, and no prepayment penalties are just some of many features that make LendKey a very attractive option.
However, it’s important to explore all opportunities before you settle on one. With College Raptor’s free Student Loan Finder, you can compare lenders and rates side by side to find the ideal loan for you!