Iowa Student Loan Review: A Nonprofit Lender With Low-Interest Options

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You might think federal student loans and private student loans are your only borrowing options for school. But there’s a third option to consider: state student lenders, such as Iowa Student Loan.

Iowa Student Loan is a nonprofit that helps Iowa students face their college costs head-on with competitive interest rates, as well as offering refinancing options for those who already have loans. Here’s what you need to know about this lender.

Iowa Student Loan review: the basics
Benefits and features of Iowa Student Loan options
How Iowa Student Loan stacks up against other borrowing options
Iowa Student Loan refinancing
Set up your Iowa Student Loan login to apply online
Is Iowa Student Loan right for you?

Iowa Student Loan review: the basics

Iowa Student Loan offers private student loans to Iowa residents attending college around the country, as well as to students from other states attending college in Iowa. Here’s an overview of what Iowa Student Loan offers:

  • Iowa Student Loan Partnership Loan: This is a private student loan offered to current undergraduate and graduate students who are attending an Iowa school or are from Iowa.
  • Iowa Student Loan College Family Loan: The College Family Loan is a private student loan open to anyone (not just parents) who wants to help pay for the educational costs of an eligible college student.
  • Iowa Student Loan Reset Loan: The Reset Loan is open to both Iowa residents and nonresidents looking to refinance their student loans.
  • Iowa Student Loan scholarships: The nonprofit also offers cash scholarships to parents saving for college, high school seniors in Iowa, and high school seniors in neighboring states who intend to attend an Iowa college.

Note that Iowa Student Loan also owns Aspire Resources, a for-profit subsidiary that provides customer service to borrowers among other functions. While Aspire serviced federal student loans in the past, its function today mainly involves business-to-business services.

Benefits and features of Iowa Student Loan options

Iowa Student Loan recommends that college students or those borrowing for a college student view these loans as supplemental to other forms of student aid, including federal student loans.

Still, Iowa Student Loan offers many benefits for borrowers looking for affordable college financing options. Check out the major features available for each Iowa Student Loan option below.

How Iowa Student Loan stacks up against other borrowing options

Thanks to its affordable student loan rates and a lack of fees, Iowa Student Loan’s in-school borrowing options are low-cost compared with many other private student loans.

Iowa Student Loan’s rates also beat those offered on some federal student loans, such as PLUS loans. Here’s a comparison of Iowa Student Loan in-school borrowing options versus federal student loans, as of May 14, 2019.

Some private student loans enter full repayment as soon as they’re disbursed. Iowa Student Loan, however, offers several repayment options for borrowers:

  • Immediate full repayment of principal and interest (with a 10-year term)
  • Interest-only payments while the student is enrolled, with a six-month grace period after enrollment ends before full payments are required (10-year term)
  • Full deferment of payments while the student is enrolled, including a six-month grace period (15-year term)

Both students and College Family Loan applicants need a minimum credit score of 670 to qualify. You might need to meet additional requirements to have your Iowa Student Loan application approved, though you can also add a creditworthy cosigner if you can’t qualify on your own.

Iowa Student Loan refinancing

Iowa Student Loan also offers student loan refinancing for both Iowa residents and nonresidents. Its flexible refinancing terms give borrowers the freedom to choose an option that makes sense for them.

A shorter term will mean lower rates and less interest overall. A longer term, however, will come with lower monthly payments, which will be more affordable for borrowers with low income relative to their student loan balance.

Borrowers can refinance between $5,000 and $300,000 in student loans, with the following choices of loan lengths and rates:

  • Five-year student loan with rates from 3.50% to 5.90%
  • 10-year student loan with rates from 4.63% to 6.65%
  • 15-year student loan with rates from 5.13% to 7.03%
  • 20-year student loan with rates from 5.63% to 7.50%

Note that the rates above are current as of May 14, 2019. Your rates might differ based on your creditworthiness and refinancing amount.

Here are the eligibility requirements you must meet to qualify for Iowa Student Loan refinancing:

  • A current debt-to-income (DTI) ratio of 40% or less, including mortgage or rent
  • A credit score of 690 or higher, with better scores qualifying for lower student loan refinancing rates
  • A credit history free of recent derogatory marks such as delinquencies, charge-offs, repossessions, collections, foreclosures and the like

If you don’t meet the above requirements, you can add a cosigner to improve your chances of approval.

Also note that Iowa Student Loan charges no student loan refinancing origination fees or prepayment penalties.

Set up your Iowa Student Loan login to apply online

Iowa Student Loan offers online applications for all three of its student loan products. Each type of loan has an “apply” option listed beneath it on its website menu. Click it, set up your Iowa Student Loan login, and you’ll be taken to a form to apply for student loans online.

Iowa Student Loan only provides custom rate estimates with a soft credit check on its Reset Loan — not on its Partnership or College Family loans. So in order to know what rates you would pay, you might have to complete a full student loan application and incur a hard credit inquiry that could ding your credit slightly.

However, Iowa Student Loan provides fairly comprehensive rate tables that outline the loan offers for different repayment terms and credit scores.

Is Iowa Student Loan right for you?

Iowa Student Loan is a strong alternative to other types of student loans for Iowa students and their families. But you’ll likely need a cosigner to qualify, and you won’t get the same protections as you would with federal student loans.

So it’s probably a good idea to max out your eligibility for federal student aid before turning to state student loans or private student loans. Once you’ve hit your borrowing limits, Iowa Student Loan could be a good option.

But make sure to shop around with a variety of lenders before borrowing or refinancing to ensure you’ve found the best possible rate. By comparing your options, you can feel confident you’ve found a student loan or refinancing offer with the most attractive terms and conditions.

Rebecca Safier contributed to this report.

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Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

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