There are several factors you need to take into consideration when looking for student loans. To start with, you’ll need to compare interest rates and fees so you can find the lowest-cost loan. You also need to look into each lender’s terms and conditions, protections, and penalties. There’s one other factor that not many people talk about and that’s lender longevity. Here’s what you should know about lender longevity and why it matters when taking student loans.
What Is lender longevity?
Lender longevity refers to how long a private lender has been in the business of providing student loans. It does not apply to federal student loans, which are offered by the federal government of the United States.
Private student loans may be offered by banks, credit unions, or private financial institutions. Each of these organizations may have gotten into the business of providing student loans at different times. Some may have been dealing with student loans for many years while others may be newcomers to this space. The length of time the lender has been in the student loan business is called lender longevity.
So, does lender longevity really matter when taking student loans? The truth is, it could have an impact on both the loan application process as well how the loan is handled after the funds are disbursed.
These are some of the more notable reasons why you should consider lender longevity as a factor when selecting a lender.
1. A longer track record indicates commitment and trustworthiness
Just knowing how long a lender has been in the business of student loans tells you a lot of things.
A longer track record indicates that the lender has been able to maintain their operations and continue to offer student loans over an extended period of time. The only way they can do this is by building a reputation of being trustworthy and reliable. Word of mouth spreads very fast. A lender who scams their customers would be out of business very quickly.
Lenders who have built their reputation over several years will do everything they can to maintain it. They won’t resort to unsavory tricks that would undermine their customer’s trust. When dealing with a long-time lender, you can feel confident knowing you’ll get an agreement with all terms and conditions clearly outlined. There’ll be no fees or other unsavory terms and conditions in the fine print.
2. Smoother onboarding process
Lenders with a longer student loan lending history are likely to have a more established system for processing loan applications, disbursing loan funds, and managing the payment process. They may also have more experience in assessing borrower creditworthiness and offering loan options that are tailored to individual needs.
Most important of all, long-term lenders have an efficient and helpful customer service team dedicated to helping borrowers through the application, funding, and payment process. This is an especially important aspect for first-time borrowers, who can find the whole process very intimidating. Having an approachable customer service representative can make all the difference.
3. More years in the business = more efficient in handling loans
A lender with a longer history in the student loan business is likely to have more experience and expertise in dealing with the various issues and challenges that can arise when borrowing and repaying student loans. Over the years, they would have taken note of the common obstacles that come up and developed better systems to resolve them. They have established processes in place to manage loan applications, service ongoing loans, and handle collections to ensure borrowers have a smoother and more efficient experience.
4. A Track Record of Accuracy and Timeliness
Long-time lenders also have a better track record of providing accurate and timely billing statements, as well as offering a variety of payment options to borrowers.
When it comes to student loans, you’ll be paying back what you borrowed several years after graduation. During that time, you may want to change the loan terms to better suit your changed lifestyle. Or you may need to pause payments for a while. Whatever your needs, it helps to know your lender will work with you to find a solution that meets your needs. A lender with more experience in the student loan business is likely to have encountered a wider range of issues and challenges that can arise during the loan repayment process. As a result, they would have developed more effective solutions for handling issues such as loan deferments, forbearances, and defaults.
Lender longevity matters for all of the reasons above. Knowing that you’re dealing with a lender who is trustworthy and will help you find a solution to any loan problem that may arise can make the process a little less stressful.
The best way to find out how loan a lender has been in the student loan business is to ask them outright.
- Do your research first.
- Compare lenders with regards to interest rates, fees, terms and conditions, and lastly how long they’ve been dealing with student loans.
- If you can’t find the information on their website, call their customer care number and ask them.
Are you researching lenders for student loans? Use College Raptor’s Student Loan Finder tool to quickly and quickly find and compare loans from reputed lenders.
| Lender | Rates (APR) | Eligibility | |
|---|---|---|---|
 |
5.34%-15.96%* Variable
3.99%-15.61%* Fixed
|
Undergraduate and Graduate
|
VISIT CITIZENS |
|
|
4.92% - 15.08% Variable
3.99% - 15.49% Fixed
|
Undergraduate and Graduate
|
VISIT SALLIE MAE |
 |
4.50% - 17.99% Variable
3.49% - 17.99% Fixed
|
Undergraduate and Graduate
|
VISIT CREDIBLE |
 |
6.00% - 13.75% Variable
3.99% - 13.75% Fixed
|
Undergraduate and Graduate
|
VISIT LENDKEY |
 |
5.50% - 14.56% Variable
3.69% - 14.41% Fixed
|
Undergraduate and Graduate
|
VISIT ASCENT |
 |
3.70% - 8.75% Fixed
|
Undergraduate and Graduate
|
VISIT ISL |
 |
4.99% - 16.85% Variable
3.47% - 16.49% Fixed
|
Undergraduate and Graduate
|
VISIT EARNEST |
 |
5.00% - 14.22% Variable
3.69% - 14.22% Fixed
|
Undergraduate and Graduate
|
VISIT ELFI |
