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Credit Union Student Loans Overview & How To Obtain One

January 30, 2012

Credit Union Student Loans

Credit union student loans are essentially private student loans that are borrowed from a credit union lender in which one must be a member of the credit union in order to apply for student loans. They are becoming popular in the student loan community as when students have used up their federal student aid and need to turn to private loans, interest is always a concern as private loans always offer higher interest, which credit union loans, loans that are private are being offered at rates comparible to federal loan programs. Credit unions are able to offer loans for college tuition because they partner up with private student loan providers, like for example Salle Mae  Although it is advised that one exaust federal financial aid options first as there are many more benefits as well as better interest rates and more flexiblity in repyament along with fixed interest rates unlike private loans, student credit union loans come with their own set of benefits like:

  • Being able to borrow up to the cost of your education minus what federal student aid and other sources of financial assistance hasn’t provided.
  • Many credit unions offer interest rate deductions as a reward for good grades.
  • Most often that not, these loans are able to be taken out with no activation fee.
  • Loan payments can be deferred while in school or paid off while attending.
  • Multi student structered credit union student loan programs are also a possibility for parents paying for more than one child to go to college, which brings about an entirely new set of benefits.
  • Credit union student loans have also boast statistics that show that their median interest rate is right around 6%.

Which like it was said above, in order to get a credit union loan for school, you will need to become a member which you will need to meet certain credentials/requirements, which tend to consist being a of 16 years old as well as filling out an application which needs to be done at the credit union of your choice, which then you will fill out the application at the facility and give it to them to wait for that status of it’s approval or lack thereof. The best way to find local credit unions is to search the yellow pages or online.

Credit Union Student Loans With Bad Credit

If bad credit is an issue, the possibility of obtaining a credit union student loans is still very much there, which one will most likely get a high interest rate which is dictated what is usually a 5 tier credit score chart. This chart basically consists of the best credit scores getting the best interest rates, in which the next best rate is obtained by those who have a credit score that is 1 to 2 percent higher than the best score and so on and so forth. So the best thing to do would be to check with your credit union and find out what the best credit score tier is and then go from there. If you do not fit this bracket or one close to it, then the best thing to do would be to find a co-signer with an interest rate as high as possible.

Credit Union Student Loans Alternative

If you cannot obtain student loans through a credit union, there is a great private student loan program called iHelp which is known to provide loans to students that have an interest rate that is a minimum of 3% less than the bigger named private student loan providers out there like Citi Bank, Sun Trust, Wells Fargo and more.  This nationwide program was created by the Independent Community Bankers of American and offered by the Student Loan Finance Corporation, in which one can be eligible for up to $10,000 every year they are in school, which iHelp is being offered at a myriad of different community banks all accross that nation, currently over 6,000. This credit union student loans alternative can provide one with the opportunity to have up to 20 years to repay their loan, deferrment while in shchool, use a co-signer on their loan for better terms, three different repayment options as well as no penalties for early repayment.