Official Lender Info Thread

I thought an efficient way of gathering this type of info might be PHEAA, which services the loans for many lenders and which offers some benefits for students attending school in PA. No such luck. Though PHEAA has the lender-specific data (it's programmed into their servicing software), it insists that the info be obtained directly from the lenders.

Making matters worse, some lenders (e.g., PSECU - a state credit union which usually offers good deals) will not answer any questions or post all the relevant details on its website. The customer service reps just refer the caller to PHEAA.

db: THANK YOU for this thread!!! i just got my first finaid package yesterday and i had no idea what to do. this is just another reason why sdn is so great!

You should realize that these interest rate reductions are not guaranteed, and the company always reserves the right to yank the benefits at any time. I went with MEDLOANS last year, so my interest rate is currently at 6.5%. If you can find anything that will accrue interest at a rate less than 6.8% you should jump on it. I doubt these interest rate reductions at repayment will even be in existence when we are finished. Bait and Switch.

i know nothing about finance or economics so please forgive me if this is a silly question, but what's the likelihood that the interest rate will drop below 6.8% this july? if it does, would i be able to get that rate if i've already chosen a lender but the funds have yet to be disbursed?

residency repayment is gonna be in for some changes in the next couple of years. the government already took away the ability to get a "residency/internship" deferment for anyone who has med loans after 1993. since then the only way residents in recent years have been getting deferments is through the "economic hardship application", and the government is considering dropping option 6 on that application which is the one residents use to qualify! sallie mae just gave the graduating seniors at my school a 2 hour talk about all this last week and it looks like residents might not be able to defer through that hardship application starting in july 2009 if the government makes the change. we'll still have forbearance thank god so that at least we don't have to pay massive payments to the loans each month as residents but we'll have to at least pay the interest on the loans during residency or its all just going to capitalize. its just unbelievable that the gov is trying to make it harder for residents to defer.

Misty said:

i know nothing about finance or economics so please forgive me if this is a silly question, but what's the likelihood that the interest rate will drop below 6.8% this july? if it does, would i be able to get that rate if i've already chosen a lender but the funds have yet to be disbursed?

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0% chance
The rate is not based on market conditions. It is set by the government.

I found this information and it is good to know who has suspended or ended their programs, etc....

http://www.finaid.org/loans/lenderlayoffs.phtml

I'm skeptical about those lenders not charging fees. Could their terms possibly change within the next few months?

New loans are so much more expensive thanks to Congress.

Doctor Bagel said:

Chase -- seems promising. They're starting a new loan program for health professional students including medical students, vet students, pharmacy students, dental students, etc. with no fees on staffords, on default fees on GradPlus (sounds like you're still stuck with the 3% origination fee) and an interest rate reduction that starts at repayment.

http://www.chasestudentloans.com/medical/index_chep.html

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Boy, you would think lenders would have to stick to their word about promotions. I was going to go with Chase or Wachovia which have rate reductions/rebates at repayment but now I'm highly suspecting that they will withdraw these benefits sometime in the next 4 years and I'll be stuck with a normal rate.

In any case, which do you think is better- Chase or Wachovia's rate rebates/reductions?

Also, does Wachovia have an origination fee?

Wachovia has another webpage up with their new terms for Staffords and they no longer give the 1, 1, and 1.5% principal credit
http://studentloans.wachovia.com/jump/b020554/stafford.htm

They do the .25% interest rate cut with auto debit, but still have to pay an origination fee that is reduced by 0.5% Not that great. I think I'm going to end up going with Bank of America since they offer a 0.25% that you cannot lose if you miss a payment unlike most other places.

i'll probably end up picking chase since they're the preferred lender at my school.

Chase definitely seems like the best option out there right now.
For those of you worried about being late for a payment and losing the on-time payment interest reduction....most banks offer (for free) a feature called something like cash reserve or similar, where your bank will not let your checks (up to a specified amount that you establish) bounce. This way you can just set the reserve above your monthly repayment and, if your account does not have enough cash in it, the bank will temporarily cover for you. In this case automatic payments are very convenient.

Also note that the bigger lenders aren't doing loan consolidations right now if you are looking to consolidate before med school (your undergraduate loans is what I'm referring to). Just a little side note. I ran into this issue with Nelnet. Keybank is still doing consolidations I believe though.

Things will be changing over the next few months until the gov't sets some new regulations. The legislation in Oct changed things BIG time for lenders. Many of them have already folded and the credit crunch of the mortgage/lending industries has affected student loan credit (private loans) as well. Keep this in mind and make sure you check your credit now and clean it up!!

Hmmm. I just got my Loyola fin aid letter, and they recommend three companies:

Chase
Access Group
Edamerica

They said they picked these three based on: 1. Loan Terms – Interest rate, fees, borrower benefits; 2. Variety of Products – Federal Stafford Loan, GradPLUS Loan, Private/Alternative Loan,Residency/Relocation Loan and Consolidation Loan; and 3. Customer Service – To our students (feedback from students regarding process and complaints)and to the school (speed, efficiency and accuracy of loan processing, timeliness of response toto inquiries and complaints).

I see you guys have the first two already listed above. Anyone ever use Edamerica? I haven't really looked into this much yet, but here's their website:

http://www.edamerica.net

EDIT: I just spoke with the financial aid office at Loyola, and they said that something to keep in mind is how long the lenders will be around. They said they feel confident Chase will still be available over the next four years. They spoke to Access Group, who said they will absolutely be lending for 2008-2009, but that's all they could state with certainty. Edamerica said that they have some business in the private loan industry too, so they're perhaps a better bet for sticking around over Access Group. However, if you need private uncertified loans (over the cost of attendance), the financial aid office said that of those three, only Edamerica offers that. Then again, I just checked with Chase, and they said that you can actually get a private student loan through them too:

http://www.chase.com/ccp/index.jsp?p...dent_loan_home

You can defer payments during medical school, and the interest rate depends on your credit rating (6.12-12.6%), as does the origination fee (0-4%).

Anyway, Loyola said that they won't adjust the cost of attendance at all (I thought I heard some schools do that if you have a mortgage, etc.), but if you show proof of things like car payments, car insurance, medical/dental expenses, etc., they will certify it and you can generally get a slightly lower rate than you would for a private uncertified loan. My head is slightly spinning over the difference between a certified and an uncertified loan.

I asked whether it would be better to wait until this summer to see where things stand with some of the lenders, and they said that that's definitely a bad idea given that so many lenders are dropping out, and funds may be harder to secure for students. They pointed out that while the federal government has said that will ensure that funds are available for students, but that that could mean that you'd have to go to multiple lenders to put together your aid, rather than getting it all from just one or two lenders.

Sorry if some of what I wrote above is a confusing mess. I'm definitely woefully ignorant when it comes to financial aid, and will probably be spending all weekend trying to make sense of this mess, and what I should do. I'm way over the cost of attendance, so unless I sell my place, I'm definitely going to need to get a private loan. Urgh. But for now, I'm thinking I will likely end up choosing Chase, and having one lender for everything.

So Im lost with financial aid as well, but has anyone tried using lendingtree.com to compare lenders?

Through this site I see that PNC Bank and Discover have good APRs but they seem a little low, are there any catches I should be aware of?

What I have seen is that a lot of the smaller lenders who didn't have access to their own capital (dollars) moving out since they can't raise the capital. What a lot of these lenders were doing is securing the dollars by selling them as securities to get more cash to make more loans... As the feds cut the rate they were paying the lenders above your 6.8, several decided it wasn't worth it. I have also seen elimination of some that were merely subsidiaries of others since the feds declared that a schol's preferred lender list can't be simply a list of "storefronts" for the same lender.
The larger bank based players will more than likely remain in the game and according to the Chase rep, Chase is looking to expand their market share in the fed loan programs. I don't see Sallie Mae moving out or Citibank. There are certainly others that are stable as well. There is also a new entity trying to enter fed lending: credit unions. Traditionally they would fund the loan and then sell it for a quick payment. I can't say if they want to actually be the lender until you pay it off or just turn the loan around and sell it.
The School as Lender program will be phased out entirely and most of you who borrowed from your school (not to be confused with Direct Lending which is directly from the feds). The vast majority of school as lender schools simply had a line of credit from a lending partner in which they were guaranteed the loans would be sold to them once funded. If you look at your statements I doubt they are coming from your school but a lender. Several companies invested heavily in building this program but the writings on the wall that it's going to end. Personally, I find the whole practice rather distasteful and shady... but some of my colleagues thought it was a great untapped revenue stream.
Several lenders are trying to "reinvent" themselves as non-profits since they get a higher rate from the feds for the length of your repayment. One has decided on a "profit sharing" version which again, I find a bit distasteful.
Direct Lending is gaining market share where there is no lender involved trying to make a profit. I tend to think they offer the most stability for the time being since I don't see the gov't going under. The servicing might be a bit clunky but I tend to think most servicing by lenders is crappy when you enter repayment-- it's not like you will be borrowing more from them...
Consolidation has become less than desirable than in the past. When the rates were 3% for you, the lender was guaranteed 9.5% (taxpayers made up the 6.5%) so all lenders were really keen on having you consolidate with them. Again, the feds cut their special allowance payment and they decided to look elsewhere to make money.
Borrower benefits are tricky. The most common one you are comapring is loan fees. Most that pay your fees will tack them right back on (w/interest) if you consolidate it later. Ask the question "what happens if I consolidate this loan?" before you choose based on that. After this many years doing FA, the whole idea of having 6 lenders when in repayment is something you all decide just ain't worth the time.
As the lenders increase their market share will the benefits be phased out in next years loan? Probably. As the competition goes down a business will offer less incentives for you to choose them.
The "lending tree" comparison or the other one being marketed essentially list the lender first who pays them the most to be number one. It may not necessarily be the best lender with the best terms for you but for me, the site owner. Again, not a fan since the interpretation from you guys will always be the first one listed is the best (it was the same w/ your school's preferred lender list: if I, the bank, make it to the top slot, I know you will pick me simply for being the top since the folks in FA obviously made me number one for a reason...).

Bagel: You might want to update the Stafford info you have in the first post of this thread regarding Access Group. I just received this update through Loyola: "Access Group stated they will now charge a 1% origination fee for the Stafford loans. They will also being suspending loan consolidation until further notice. Chase and Edamerica still have no fees for the Stafford loans."

Our FA officer told us Sallie Mae contacted him this week and they are following the Access group's lead and charging a 1% origination fee on Staffords. No other source to back this up besides his word, but it doesn't surprise me at all. Most likely all other lenders are going to follow this pattern, such is how an economy works.

Yes. I read an article yesterday from Google News talking about Sallie Mae not doing consolidation loans any more. The article also mentioned that it would be charging fees from now on, too.

Why aren't students up in arms about this?! The cost of our education is giong up by thousands of dollars a year!!!!

UserNameNeeded said:

Yes. I read an article yesterday from Google News talking about Sallie Mae not doing consolidation loans any more. The article also mentioned that it would be charging fees from now on, too.

Why aren't students up in arms about this?! The cost of our education is giong up by thousands of dollars a year!!!!

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??? If you don't like it, don't take out the loans.

Up in arms or not, there's really not much we can do besides go with lenders that don't charge fees.

EDIT: One thing that we CAN do is try to encourage our schools to participate in the Federal Direct Stafford Loan Program if the private lenders keep making the deals worse and worse. I don't believe the direct loans have origination fees, etc.

Sol Rosenberg said:

??? If you don't like it, don't take out the loans.

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From the John McCain out-of-touch school of thought, I see.

UserNameNeeded said:

From the John McCain out-of-touch school of thought, I see.

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What does this have to do with John McCain again? But, more to the point, what is your suggestion for getting lenders to change their policies (I presume that you didn't like my suggestion that you bring your business to lenders that don't charge fees.) Please be more specific than, "we can get up in arms."

I stumbled upon what looks to be some good deals for people attending MO and OK schools through commerce bank. In fact, they look too good to be true, but if your are attending school in one of those states (I'm not ) it's probably worth looking into:

http://www.commercebank.com/persona...cationloans/loanrepayment/repaymentoffers.asp

http://www.simpletuition.com

Some of the borrower's benefits on here look to be pretty good. Not sure if it still applies for loans for the 2008-2009 year though.

Whats up with Wachovia and Chase offering only $20,500 max as opposed to the previous $38,500 for stafford loans. Is this universal now?

I noticed wells fargo offers 20,500 to 40,500?

Doctor Bagel said:

That is the max for non-health related grad programs. Most likely, their website just doesn't reflect that we can borrow more -- it's something you come across pretty frequently when you look at lender and school sites.

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Great then I will be going with Chase for sure

I have previously used citibank (back when i was naive I gave up like $1000 in origination fees ), Then THE, then graduate leverage, then back to THE after GL went out of business and now THE is out of business.

SketchLazy said:

http://www.simpletuition.com

Some of the borrower's benefits on here look to be pretty good. Not sure if it still applies for loans for the 2008-2009 year though.

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With all the changes going on, some stuff is definitely outdated. Makes it harder to compare.

Sol Rosenberg said:

I stumbled upon what looks to be some good deals for people attending MO and OK schools through commerce bank. In fact, they look too good to be true, but if your are attending school in one of those states (I'm not ) it's probably worth looking into:

http://www.commercebank.com/persona...cationloans/loanrepayment/repaymentoffers.asp

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MOHELA is having big issues and experiencing lots of layoffs I wouldn't be too surprised if they announce some much less promising promotions for next year if they service loans at all

Navy Federal
http://www.navyfcu.org/loans/education.html

They don't charge an origination fee. There is a 2% reduction in the interest rate after 24 months of ontime payments, and an additional .25% if you do an automatic deduction from a bank account.

The 2 cons are: you have to repay the loan within 10 years (instead of like 30) and that this bank is for military people (or family of active/retired military).... so not everyone will be allowed to use this lender.

It sounds like a good deal to me. I'll call them tomorrow and if I learn any new info, I'll let y'all know.

I went ahead and picked Bank of america for Stafford, and am not doing GradPlus this year..I already have a checking account with them..if i need more money i'll apply for it in advanced..or i'll bum off my parents.

Seems like Chase is the best deal around right now (NC/MO/OK specific lenders aside.) Has anybody found an "open to everyone" deal better than Chase?

I just called my school (Jefferson) and they are actually adding Chase to their pref lenders list. They said to wait until May to sign up for chase as a new program for health students is coming up. I went on the Chase website and it looks like the new program will be up and running in May and offers no orig. and default fees and 5.8% on Stafford.

plauto said:

I went on the Chase website and it looks like the new program will be up and running in May and offers no orig. and default fees and 5.8% on Stafford.

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Is the 5.8% available to med students? Had the impression the lower rate was for undergrads only.
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plauto said:

I just called my school (Jefferson) and they are actually adding Chase to their pref lenders list. They said to wait until May to sign up for chase as a new program for health students is coming up. I went on the Chase website and it looks like the new program will be up and running in May and offers no orig. and default fees and 5.8% on Stafford.

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In May the Stafford rates will change at Chase, but they don't know what they'll be. They will go into effect in July when the funds are given out, but we'll know in May what those rates will be.

ACK. I'm speaking to Chase's private educational loan department right now, and they said that while there's a $40,000/year cap if you're an undergrad, the grad student limit is by school. And for med students of Loyola, you can only get a Chase private educational loan up to $5,000/year! HUH? She said if I were an undergrad, I could get a loan for up to $40,000/year.

I just called Bank of America and they said they are getting rid of the .25% interest rate reduction and are only giving it to student from certain schools in which they are a "preferred servicer" My school goes through nelnet so B. Of. A said that, they are not their preferred servicer.

Anyone have similar experience with them on this?

"4If the first disbursement on your loan is before 6/30/09, a 0.25% interest rate reduction applies if your application is processed through our Preferred Servicer and if you have a Bank of America checking or savings account open for at least 60 days between your loan disbursement and your first scheduled payment. Your rate will be reduced shortly after you make your first scheduled payment on time. To see our checking and savings accounts, visit https://www.bankofamerica.com/index.jsp and click "Checking" or "Savings & CDs". "

So chase is 5.8% at repayment. For med students that means we don't get the 5.8% for a long long time. If you're an MS1, that may mean a decade before you see this rate, esp if you defer your loans during residency/fellowship. And that's assuming such deferment will be an option when we graduate.

Too many if's. I say we wait for a better deal. Still plenty of time to pick a lender.

Segolene said:

Is the 5.8% available to med students? Had the impression the lower rate was for undergrads only.
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yep, it's also for us. check this page (from a previous post):
http://www.chasestudentloans.com/medical/index_chep.html

They make it sound like this package is coming up in May, and that's what my fin aid office said as well. While everything is possible, I'd find it strange that they would write this for a loan program that's not up yet and then change (for worse) the terms later.

From the Chase website http://www.chasestudentloans.com/medical/index_chep.html (see footnote 'Important Information'):

"In addition, for Chase Health Stafford loans that are originated and serviced directly by Chase under federal lender code 831216, the borrower will receive a 1.00% interest rate reduction that will be applied automatically at the time the loan enters repayment and will remain in place for the remainder of the loan term or until default or loan consolidation. The 1.00% interest rate reduction will not lower the monthly payment amount but instead will reduce the interest that accrues, thereby reducing the total amount repaid and the time in which the loan is repaid.

Does this mean that the 5.8% interest rate (equivalent) is not retroactive to the date of disbursement? If not retroactive, then the interest accrued in the years preceding repayment is still based on 6.8%?

Also, from the same footnote: "Chase currently holds and does not sell its Chase Health Stafford and Chase Health Grad PLUS loans made under this lender code."

What happens if and when Chase sells the paper. All bets are off with regard to the 1% discount? What would bind the successor institution?