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Tuesday, January 18th
Sallie Mae is all about student loans. Originally, it was a governmental organization that serviced federal education loans, but the Sallie Mae Bank now operates as a standalone funding option strictly for private loans: more than $19 billion in current student loans, to be exact! You can be approved to borrow up to 100% of your school-certified expenses: this can include not just your tuition and fees but also books, housing, meals, travel, even a laptop.
High approval rates for subsequent loans
One reason that many students choose Sallie Mae to fund their education is because of the lender's high approval rate for returning students. According to the lender, 96% of undergraduate students who apply for a loan after their first year of borrowing continue to get funding (when they return with a cosigner). Note that Sallie Mae doesn't specify how much students get from year to year; some students report that their loans got smaller from one school year to the next.
Loans available even with less than half-time enrollment
Sallie Mae doesn't charge origination fees on any student loans, and they keep their interest rates competitive. We invite you to visit their site to get the current rates for your type of loan, but as a point of reference their advertised rates are a little higher than other lenders we reviewed. Also, you can be approved for a loan even if your enrollment is less than half-time; that's a plus over lending institutions that require a full-time commitment to be eligible.
Nice range of repayment options
How about repayments? You'll get a 0.25% discount when you make your repayments via auto debit; that's pretty common among student loan providers. Plus, Sallie Mae has a wide range of repayment options. While you're in school, you can choose from deferred repayments (no payments required while in school or during your grace/separation period), fixed repayments (pay the same amount every month), or interest repayments (just pay interest until you graduate and are out of your grace period). Once you've left school, you can take advantage of Sallie Mae's Graduated Repayment Period that allows you to make interest-only repayments for up to a year, or request deferment, forbearance, rate reduction or term/rate modification if you encounter financial difficulties.
Cosigners eligible for release after 12 consecutive, on-time payments
We appreciate that Sallie Mae allows for loans both with and without cosigners. If you choose one of their student loans and get approved with a cosigner, they can be released after just 12 on-time principal and interest payments. That's a big advantage over lenders who require a total of 24 payments before granting the release. Bear in mind that you'll need to meet certain criteria for approval, such as a credit review of your own history, proof of income, and proof of graduation.
Loans waived upon disability or death of the student
Also, this lender is more compassionate than average when it comes to the death or disability of the borrower. If the student "becomes totally and permanently disabled" or dies, Sallie Mae will waive the current balance on the loan, minus any tuition refunds paid out by the school itself.
Extra perks to help you learn
Finally, at the time of this evaluation, Sallie Mae was offering a promotional benefit of four complimentary months of Chegg Study for all undergraduate and parent loans. This study program lets students get expert answers on up to 20 questions per month.
Customer service is a nightmare
You might think that with so many perks for borrowers, 100% US-based customer service, and an "A+" rating and accreditation from the Better Business Bureau, Sallie Mae would be one of the best choices for taking out student loans. Unfortunately, student feedback on how this lender services their loans continues to be extremely negative. We found hundreds of complaints and unhappy reviews that can be described as troubling at best. One person said that Sallie Mae agreed to put their loan into deferral status, but instead they entered it as a charge off - which dropped the credit scores of the borrower and cosigner by 200 points! This error wasn't taken care of in a timely fashion and impacted the individuals' ability to rent an apartment. Not good at all! Another complaint described how a Sallie Mae representative called all of the members of the borrower's family looking for repayments and then suggested that the parents take out a home equity loan. Even though Sallie Mae responded to every complaint filed at the BBB, it often took a week or longer - and still left the issue unresolved.
There are better options
Obviously, there are lots of college students who use Sallie Mae for their student loans. This platform offers a vast array of loan types, repayment terms, and has some benefits that go above and beyond what you might see with other lenders. However, is it worth it if the servicing is a nightmare? If your credit score is damaged for no apparent reason? We would have to say no. Use Sallie Mae as your lender if you must, but we'd encourage you to check out a few other options for student loans before making the commitment here.
With 45% of high school graduates finding it necessary to take on student debt to finance their higher learning, that's an important question to answer. While most student loan debt comes from federal loans, some people discover that their government loans just aren't enough to cover the full costs of tuition, room and board, expensive textbooks, and everything else necessary for their college education.
If you find yourself in that situation - for your studies or your children's - you might get overwhelmed trying to figure out where the money will come from. And even once you've selected a lender, you still need to decide what repayment terms are best. Fixed- or variable-rate? Interest-only or small fixed repayments while still in school or fully deferred for 6-9 months after graduation? Repaying over five years or twenty? There are a lot of factors to consider that are unique to you.
Fortunately, there are quite a few providers of student loans that can help you not only figure out those answers but also connect you with the money you need to pay for school. Many of them can even prequalify you for a loan with just your name, address and birthdate, with no impact on your credit report. Rest assured that millions of students (and many of their parents) have successfully navigated this process - and you can too.
Here are several aspects of student loan providers to keep in mind as you decide which ones merit further consideration:
To help you get the funds you need for your education, TopConsumerReviews.com has evaluated and ranked the best options for student loans today. We're confident that this information will make it possible to find the right way to cover the costs of your tuition, books and more!
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