Why it’s Smart to Choose a Credit Union for Your Private Student Loans
A variable rate can increase if the prime index rate goes up. Your lender usually limits how high your rate can get, called the ceiling rate. Under a variable rate, you may pay more interest on your loan over time compared to a fixed rate.
Repayment Schedule
Some private lenders require students to make full monthly payments while attending school. Others give students the option of deferring part or all of the loan payment until after graduation.
Student Choice lets borrowers decide if they want to make interest-only monthly payments, full payments of principal and interest every month, or defer all payments until 6 months after graduation.
The standard repayment schedule is 20 years for borrowing up to $40,000 and 25 years for any amount over that amount. You’ll have a monthly minimum payment to make, based on the amount borrowed and interest accrued. If you can afford it, you can also pay more than your monthly minimum to help pay your loan off quicker.
Why You Should Choose a Credit Union
Credit unions offer students private loans to help pay for college. All credit unions are member-owned nonprofits that provide the same banking products and services as larger, for-profit banks.
Members belong to a board and have a say in how the credit union is run. Federal credit unions are regulated by the National Credit Union Association and must follow national standards for banking.
Better Banking Experience
Credit unions are known for offering their members lower banking and financial fees and better customer service than other big banks. They’re more interested in building a long-term relationship with their customers and work hard to make sure you’re satisfied.
Lower Interest Rates
Since credit unions don’t pay taxes or need to make large profits to appease their stockholders, they can afford to offer their customers better interest rates. Credit unions may offer lower interest rates for private student loans than for-profit banks and other online lenders. The lower your interest rate, the less you pay over time.
Easier to Qualify for Loans
The application requirements at credit unions aren’t always so strict. It might be easier to qualify for a private student loan at a credit union even if your credit history is short or your credit score is average.
What Types of Private Student Loans are Available?
Many credit unions partner with Student Choice to offer private student loans to their members. The rates, approval, and underwriting for Student Choice loans are provided directly through your local credit union. The money for your private student loan comes through your credit union, and Student Choice manages your repayment plan.
When comparing loans, look at its terms, including:
Interest rates: does it offer a fixed or variable rate, and what is the amount?
If there are any origination fees.
What your repayment options and terms are.
What your monthly payments will be.
Apply for Private Student Loans Through T&I Credit Union
Private student loans are necessary if you still need money for college after receiving federal student loans and financial aid from your school. Private student loans from credit unions help cover the gaps in your funding so you can still attend school.
Credit unions may offer lower interest rates or better repayment terms for your private student loans than other lenders. T&I Credit Union offers banking and financial services, including private student loans, to members in Michigan. Contact us today for all your loan needs.