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A few types of lenders offer private student loans, including online lenders, traditional banks, and credit unions.
Depending on your needs, getting a student loan from a bank might be the right choice for you — especially if you already have a bank account and can qualify for loyalty discounts on a student loan.
Here’s what you should know about banks that offer student loans:
- 4 banks that offer student loans
- Banks vs. other student loan lenders
- When are private student loans a good option?
- How to take out student loans
- Taking out student loans with a cosigner
- How to pick the best student loan for you
- How do student loan interest rates work?
4 banks that offer student loans
Before you take out a student loan, it’s important to compare as many lenders as you can — not only from banks but also from other lenders. This way, you can find the right loan for your needs.
Here are a few banks that offer student loans. Citizens and Sallie Mae are Credible partners, while the other lenders listed are not.
|Bank||Fixed rates from (APR)||Variable rates from (APR)||Loan terms||Cosigner release offered?|
|4.99%+1||6.37%+||5 to 15 years||Yes, after 36 months of consecutive, on-time payments|
|Check with lender||Check with lender||15 years||No|
|Check with lender||Check with lender||5 to 15 years||Yes, after 48 months of consecutive, on-time payments|
|4.50%9 - 15.49%9||6.37%9 - 16.70%9||10 to 20 years||Yes, after 12 consecutive on-time payments|
Lowest APRs reflect autopay, loyalty, and interest-only repayment discounts where available | Read our full methodology | 10Ascent Disclosures | 1Citizens Disclosures | 2,3College Ave Disclosures | 11Custom Choice Disclosures | 7EDvestinU Disclosures | 8INvestEd Disclosures | 9Sallie Mae Disclosures
Citizens offers student loans from $1,000 to $350,000 with repayment terms from five to 15 years.
If you already have an account with Citizens, you could get a 0.25% loyalty rate reduction — plus another 0.25% off your rate if you sign up for autopay.
With Discover, you can borrow $1,000 up to 100% of your cost of attendance with a 15- or 20-year term. Additionally, Discover offers a 1% cash reward to undergraduate and graduate students who earn at least a 3.0 GPA.
Check Out: How Long Does It Take to Get a Student Loan?
PNC Bank student loans range from $1,000 to $65,000 (depending on your degree) with terms from five to 15 years. If you sign up for autopay, you could get a 0.50% rate discount — higher than the typical 0.25% offered by many other lenders.
With Sallie Mae, you can borrow $1,000 up to 100% of the school-certified cost of attendance with repayment terms ranging from 10 to 20 years.
Additionally, if you apply with a cosigner, you can apply for cosigner release after just 12 months of consecutive, on-time payments.
Banks vs. other student loan lenders
While banks tend to be similar to other types of student loan lenders, here are a few differences to consider:
- Fewer options for bad credit: You’ll generally need good to excellent credit to get approved for a private student loan. But some banks may have more stringent credit qualifications. This might make it hard to qualify if you have poor or fair credit.
- Might perform a hard credit pull: Some banks, such as Sallie Mae, perform a hard credit check before you can see your personalized rates. This hard credit pull can have a slightly negative impact on your credit score. Online lenders, on the other hand, tend to use only a soft credit pull before showing you the rates you might qualify for, and will save the hard credit pull for when you apply for a loan.
- Longer application process: Depending on the bank, it might take longer to get a student loan in comparison to an online lender.
If you decide to take out a private student loan to pay for college, remember to compare as many lenders as you can — including banks and other types of lenders — to find the right loan for you.
This is easy with Credible: You can compare your prequalified rates from multiple lenders in two minutes.
When you’ve exhausted your federal student loans, private loans can be a good option to help cover any remaining costs. But keep in mind that when it comes to private student loans, it’s important to only borrow what you need.
When are private student loans a good option?
It’s a good idea to use federal student loans or gift aid (like grants and scholarships) before turning to private student loans. But private loans can be a great option to help fill any financial gaps. Here are a few situations when private student loans may make sense for you:
- You’ve already applied for federal student aid. If you’ve reached the limit for federal subsidized and unsubsidized loans and still need money to pay for school, private student loans can fill any funding gaps in your education.
- You have good credit. You’ll need to have good to excellent credit to be eligible for many private student loans. If you aren’t eligible, applying with a cosigner who has good credit can improve your chances, and could even get you a lower interest rate than you’d get on your own.
- You don’t qualify for an income-driven repayment (IDR) plan. Private student loan repayment options tend to be more limited compared to federal loans. To qualify for some federal IDR plans, you have to be able to demonstrate partial financial hardship. Unfortunately, private student loans don’t offer income-driven repayment plans.
- You’re an international student. If you’re an international student studying in the U.S., it’s likely that you won’t qualify for federal student aid. Private student loans may be a good option to fund your education.
How to take out student loans
If you’re ready to get a student loan, follow these four steps:
- Fill out the FAFSA. If you need to pay for school, start by completing the Free Application for Federal Student Aid (FAFSA). Your school will use your FAFSA information to determine what federal financial aid you’re eligible for. Your FAFSA results might also qualify you for school-based scholarships or grants.
- Apply for scholarships and grants. It’s a good idea to apply for as many scholarships and grants as you can. Unlike student loans, scholarships and grants don’t have to be repaid — meaning they’re essentially free money you can use for school.
- Take out federal student loans. If you need to borrow money for school, starting with federal student loans is usually a good choice. This is mainly because you’ll have access to federal student loan benefits and protections, such as income-driven repayment plans and student loan forgiveness programs. To apply for federal student loans, you’ll need to fill out the FAFSA.
- Use private student loans to fill any gaps. If you’ve exhausted your scholarship, grant, and federal student loan options, private student loans could help fill any financial gaps. Like federal student loans, you can typically use private student loans for a variety of education programs, such as trade schools, online colleges, and community colleges.
Learn More: Federal vs. Private Student Loans: 5 Differences
Taking out student loans with a cosigner
You’ll typically need good to excellent credit to qualify for a private student loan. A good FICO credit score is usually considered to be 670 or higher. This means you might have a hard time getting approved if you have a lower credit score than this or haven’t established a credit history yet.
If this is the case, here are a couple of options to consider:
- Apply with a cosigner. Having a cosigner with good credit can greatly improve your chances of getting approved for a student loan. In fact, most borrowers use a cosigner when applying for private student loans. Even if you don’t need a cosigner to qualify, having one could get you a lower interest rate than you’d get on your own.
- Build your credit. If you can wait to take out a loan, you could spend some time building your credit before applying in the future. You can improve your credit in a few ways, such as making on-time payments on all your bills, paying down credit card balances, or getting a credit-builder loan.
Keep in mind that your credit also affects the interest rates you’ll qualify for. In general, the higher your credit score, the lower your rate. Having a cosigner with good credit might also help you get a better rate, which can save you money on your overall loan cost.
Whether you apply with a cosigner or not, it’s important to consider how much a student loan will cost you so you can be prepared for any added expenses. You can find out how much you’ll owe over the life of your federal or private student loans using our student loan calculator below.
Enter your loan information to calculate how much you could pay
With a $ loan, you will pay $ monthly and a total of $ in interest over the life of your loan. You will pay a total of $ over the life of the loan, assuming you're making full payments while in school.
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Check Out: Taking Out Student Loans Without a Cosigner
How to pick the best student loan for you
To find the best student loan for you, you’ll need to shop around and compare your options from as many lenders as you can. You’ll need to consider several important factors as you do your research, including:
- Interest rate: The interest rate on a loan plays a major role in determining how much you’ll pay for it over time. You’ll also need to decide whether you’d prefer a fixed or variable rate. A fixed rate will remain the same over the life of your loan, which means your payment won’t ever change. A variable rate might be lower in comparison — however, it can also fluctuate over time.
- Repayment term: The shorter the term, the less you’ll pay in interest. Because of this, it’s usually a good idea to choose the shortest term you can afford.
- Cosigner release: Some lenders allow cosigners to be released from the loan once you’ve made on-time payments for a certain amount of time. If you’d like to remove your cosigner from the loan in the future, be sure to check whether the lender offers cosigner release.
- Discounts: Depending on the lender, you might be able to take advantage of discounts. For example, many lenders provide rate discounts if you sign up for automatic payments. Others offer loyalty discounts if you already have an account with them.
If you’re ready to start comparing lenders, Credible can help — you can see your prequalified rates from multiple lenders after filling out a single form.
How do student loan interest rates work?
Student loan interest rates vary depending on the type of student loan you borrow and your circumstances.
- Federal student loan interest rates are fixed rates set by Congress. Your interest rate is determined by the federal loan you borrow, your dependency status, and your year in school.
- Private student loan interest rates can be either fixed or variable, and are determined by your credit score and the repayment term you opt for. Depending on your credit score, your interest rate for a private student loan could be lower than what you’d get with a federal loan.
Here’s a look at how current federal student loan interest rates compare to private student loan interest rates for borrowers who received a private loan through Credible in June 2023:
|Borrower type||Loan||Loan type||APR|
|Undergraduate students||Federal||Fixed rate: 5.50%|
|Graduate or professional students||Direct Unsubsidized Loan||Federal||Fixed rate: 7.05%|
|Direct PLUS Loan||Federal||Fixed rate: 8.05%|
|Borrowers with credit scores of 720 or higher||5-year loan||Private||Variable rate: 6.04% average|
|Borrowers with credit scores of 720 or higher||10-year loan||Private||Fixed rate: 7.14% average|
Keep Reading: Low-Interest Student Loans