Alternatives to American Express Student Loans

 July 12, 2019
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Private Student Loan rates starting at 0.94% APR

1.19% to 11.98% 1

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1.62% to 11.73% 2

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0.94% to 11.44% 3

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  • Variable APR

You could, in theory, repay education debt using a credit card from American Express (though it probably wouldn’t make financial sense). And you could certainly go to Amex if you need a personal loan. But at the end of the day, there is no such thing as an American Express student loan.

With that said, there are useful alternatives to (non-existent) American Express student loans. Here’s a look at your options if you need money for school.

Alternatives to American Express student loans

After you’ve finished off your search for gift aid (such as scholarships), worked to increase your income, and asked for help from family and friends, you could be ready to resort to student loans.

Unlike scholarships and grants, of course, loans need to be repaid — with interest — making them the most expensive and least ideal financing option.

Given the cost involved, you’ll want to make sure you borrow from the right lender. And if your preferred lender is American Express, which isn’t in the student loan business, you’ll need to consider the competition.

Federal student loans

The Department of Education offers undergraduates, postgraduate students and parents the ability to borrow for their higher education costs.

Although the Department of Education, as a lender, awards the same interest rates regardless of your credit history, federal student loans are usually recommended over those of private lenders, even if you do have stellar credit. That’s because federal loans include unique features and protections, such as:

Even better, if you can demonstrate financial need, you could qualify for the Department of Education’s Direct Subsidized Loan. For this type of loan, accruing interest is covered by the government while you’re in school, during your grace period, and for other pauses in repayment.

Private student loans

Although there are rare scenarios when you should prioritize a private lender over the Department of Education, it’s usually best to use private student loans to fill any remaining gaps, if necessary, in your borrowing needs.

In particular, a student loan from a bank, credit union or online lender could come in handy if you run up against federal loan borrowing limits. While postgraduate students and parents can borrow up to the cost of attendance, Uncle Sam limits undergraduates to between $5,500 and $12,500 per school year.

If you initially sought out American Express to serve this purpose, you might be interested to learn about two other well-known lenders that offer not just credit cards or savings accounts but, yes, student loans as well.

1. Citizens Bank

Citizens Bank offers multi-year approval for additional borrowing, should you need it.

Citizens also stands out by lending not just to American students but also to international students with a creditworthy U.S. citizen or permanent resident cosigner, as well as parent borrowers. Any of the above could receive a 0.25% interest rate reduction for enrolling in autopay, plus an additional 0.25% loyalty discount if the borrower or cosigner already has an account or loan with the bank.

Other features of Citizens’ student loans include:

  • Borrow between $1,000 and $150,000 (for undergraduates)
  • Repayment terms available: 5, 10 and 15 years
  • Choose between fixed and variable interest rates
  • Defer repayment while you’re enrolled, or make interest-only or full payments
  • Release your cosigner (if you have one) after three years of on-time payments

2. SunTrust Bank

Like Citizens Bank, SunTrust Bank goes above and beyond the typical lender’s reward if you enroll in autopay for your student loan. It provides a 0.25% for repaying your loan from any bank account, and it adds another 0.25% if you connect a SunTrust account. The bank also features a student-focused checking account that waives monthly maintenance fees for the first five years.

Other details on SunTrust student loans include:

  • Borrow between $1,001 and $65,000 (for undergraduates)
  • Repayment terms available: 7, 10 and 15 years
  • Choose between fixed and variable interest rates
  • Defer repayment while you’re enrolled, or make interest-only, partial or full in-school payments
  • Release your cosigner (if you have one) after three to four years of prompt payments
  • Additional discounts for graduating and making on-time payments

Finding the best private student loan option

Just because American Express doesn’t offer student loans, it doesn’t mean you can’t find financing from a similar lender.

Starting with the Department of Education’s menu of federal student loans is a good first step. You might also consider banks, credit unions and online lenders if you don’t value federal loan protections or, more likely, if you need to borrow beyond federal loan limits.

As you shop around for the right private student loan lender, compare your options based on the criteria that makes sense for you. Ensure that your pick offers a low interest rate and the loan term you desire, plus repayment safeguards that won’t leave you unprotected.

One place to start is with our list of top-rated lenders — even if American Express isn’t on there.

Note: Student Loan Hero has independently collected the above information related to student loan interest rates and terms. The financial institutions mentioned have neither provided nor reviewed the information shared in this article.

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