I’ll start LSU vet school this fall, and for the first time in my life, I’ll get a student loan. Now, I have no idea about lenders, or what is the better option, and the financial aid office in LSU hasn’t been very helpful (besides the fact that I’m not there). They just gave me a list with the lenders (nine) and their “key features”. Can anyone help me pick the best one?
Edsouth
4% rebate of the original principal balance after 33 on-time payments with teh SmartPay program
Immediate 1% reduction in origination fees
Academic Nelnet Loan
1% origination fees discount
2% interest rate reduction after 48 on-time payments
.25% interest rate reduction for auto debit
Bank One
3.3% credit after 33 on-time payments if enrolled in Sallie Mae’s Internet self-service with valid e-mail address
Campus Federal Credit Union
No origination fee
No guarantee fee
Chase
Same as Bank One
Hibernia
1% automatic interest rate reduction at repayment
No guarantee fee
2% interest rate reduction after 48 timely payments
.25% interest rate reduction for auto-debit payments
Rebate of origination fee paid in excess of $250 after 24 timely payments
Louisiana Education Loan Authority
No origination fee
No guarantee fee
3% interest rate reduction after 36 consecutive on-time payments
.25% interest rate reduction for auto-debit service
0% interest loans for Louisiana public school teachers
Nellie Mae
Same as Bank One and Chase
Union Planters
2% interest rate reduction after 48 on-time payments via auto-debit
.25% rate reduction for auto-debit
Oh, and I was finally told what origination fee was, but not guarantee fee. And does anyone have any advice on how to get a private student loan? I need money to move to LSU.
My undergrad are through Nelnet, and they’ve been decent to deal with - I’ve never had a problem with them.
My graduate loans are through a bank - I’ve never had any problems there either (I expect them to be sold to another lender though - my undergrad were through a bank and were sold shortly after graduation).
Unless you’re going to be a teacher in LA, I’d eliminate the Louisiana State Education Authority ones - although the rate reduction sounds nice. I’d probably go with Hibernia or Nelnet, based on what you’ve listed.
Private loans - you might look at Sallie Mae - they do private loans as well as Staffords. I took out some for last summer’s classes.
Just wanted to point out that, in LSU’s defense, they’re not allowed to recommend a lender to students. Our office does the same thing, gives a list of “preferred lenders”, but really you can use any bank you want. With Stafford rates going down AGAIN this year, many lenders are cutting back on their incentives, so it’s great that the ones LSU listed seem to be still offering some pretty good deals.
Waiving the guarantee and origination fee gives you more money up front. The two fees together are generally 3-4% of the loan amount–so if you sign a promissory note for, say, $10,000, you could end up getting a check for only $9600-9700, even though you still have to pay the full $10K back later. Repayment incentives help you out in the long run, but read the fine print–lots of times they come with a long list of conditions, like any break in repayment or late payment disqualifies you (not implying you would miss a payment, but it’s good to know these things ).
Most larger banks, and many smaller ones, have private educational loans these days. They’re sometimes called “alternative” or “signature” loans, and will likely require a co-signer and/or credit check, unlike the Stafford loan. If you go with a private loan from your Stafford lender that might simplify the repayment and/or consolidation process later on.
Good luck at vet school. My oldest brother got his DVM from Texas A&M a few years back and even though it was the hardest few years of his life he’s loving every minute of his career.
