LendKey Private Student Loans Review: Connect with Community Banks, Credit Unions

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When you shop around for a private student loan, you might apply with multiple banks and credit unions to compare offers. But when you look into LendKey private student loans, this process is already baked into the cake.

On its platform, LendKey promises to connect you with hundreds of community banks and credit unions simultaneously. You can access lenders you might have otherwise overlooked and, ideally, compare multiple loan offers in one place.

In addition to the student loan refinancing it offers to graduates, LendKey’s partner lenders also offer in-school loans with competitive interest rates and some partner lenders even offer an an attractive cosigner release policy. Read on for all the details.

LendKey student loans review: The basics

To be eligible at LendKey — founded in 2009 with offices in New York City and Cincinnati — you have to be a U.S. citizen or permanent resident attending an eligible school. You must also meet the specific lender’s credit and income requirements to qualify for a loan. You (or your cosigner), for example, would need a credit score of at least 660.

Keep in mind that because LendKey would be your servicer, not your lender, the terms of your loan would depend on your lending bank or credit union. With that said, here are the basics of private student loans serviced by LendKey:

  • Available for undergraduate and graduate students
  • Borrow as little as $2,000 and as much as $120,000 (undergraduates) or $160,000 (graduate students)
  • Fixed and variate interest rates available
  • No application or origination fees
  • No prepayment penalties
  • 6-month low-payment grace period after you leave school (see below)
  • Autopay rate discount of 0.25%
  • Up to 18 months of forbearance
  • Cosigner release offered after 12-36 prompt monthly payments

There are also some factors of LendKey private student loans that might not be as appealing:

  • You’re required to apply with a cosigner when your income is below $24,000 or you have less than 3 years of credit history
  • You must make interest-only or fixed $25 payments while enrolled in school and during the grace period
  • Only a 10-year repayment term is available

What we like about LendKey private student loans

Given that LendKey is more of a marketplace than a lender, you might not be surprised to learn that its application process generally takes less than 15 minutes and is relatively easy to follow.

When applying, you’ll be asked for information about your school, major and citizenship status. You’ll also have to give your Social Security number and total annual income, and you must agree to undergo a credit check. After that, you’ll receive a loan offer.

Here are a few factors that could make that offer more attractive in your eyes.

Your ‘Academic Credit Score’ could lower your rate

You might wonder why LendKey also asks you to select the range of your grade point average (GPA) or send over your latest transcripts. This is because the company uses the information to assess your reliability.

Your GPA, course of study and class-standing information — right alongside your (or your cosigner’s) credit history — is plugged into LendKey’s proprietary credit scoring model. This is referred to this as your Academic Credit Score, and the better it is, the better the chance you have to score lower interest rates.

A lower rate could mean significant savings. Say you qualify for a 6.00% interest rate and intend to borrow $10,000 for your next year of school. Repaying your five-figure debt over a 10-year term would cost you $3,322 in interest, according to our monthly payment calculator.

Now say your Academic Credit Score dragged down your loan application, so you only qualified for a 9.00% rate. Repaying that $10,000 over the same term would include $5,201 of interest.

Release your cosigner in 1 to 3 years

Most undergraduate student loans offered by private lenders require or strongly encourage you to apply with a cosigner. As a teen or 20-something, you likely don’t have the income or credit history to apply on your own anyway.

At LendKey, you’ll need to attach this guarantor to your loan application if you earn less than $24,000 per year or have fewer than 36 months of credit history.

On the plus side, some LendKey network lenders have a cosigner release policy that would allow you to thank your Mom, Dad or other guarantor and send them on their merry way after 12 to 36 months of full and prompt payments.

Pause your repayment for up to 18 months

Hiccups are a part of life, so naturally, you could expect to experience one during your student loan repayment as well. A significant benefit of borrowing from one of LendKey’s member lenders is that you could pause your repayment for up to 18 months (in six-month increments).

The forbearance policy is especially generous when compared with competitors. Even some top-rated lenders max out their offering at 12 months.

Borrowing from a company that promises relatively extensive hardship protection will not only put your mind at ease — it could lower your costs and keep your finances from additional harm, avoiding a serious incident like student loan default.

But be aware that, like most competitors, LendKey’s policy allows interest to accrue and capitalize onto your loan balance while you step away from repayment.

What to keep in mind about LendKey private student loans

You might find LendKey’s platform user-friendly, but remember that it’s not your lender — the bank or credit union would be.

That explains, at least in part, why you must complete a full application off the bat, subjecting yourself to a hard credit check. There’s no way, at least currently, for the company to help you prequalify faster and with less effect on your credit.

Here are a few more factors to consider before choosing LendKey as your loan servicer:

You might not receive multiple loan offers

The real boon of borrowing from LendKey is that it can help you rate-compare among lenders and connect you with lesser-known lenders you might not have considered on your own.

Unfortunately, depending on your borrowing situation, LendKey might not truly deliver part of this key benefit. After completing the first stage of your application, for example, you might be asked to select your lender, only to find a single credit union available.

In other cases, your state of residence might restrict you to just one of LendKey’s partner lenders. And even if LendKey’s prescribed lender offers a suitable loan agreement, you might still need to hunt around elsewhere to ensure you find the best loan available.

You are required to make in-school payments

There are plenty of benefits of making in-school payments: Beginning to repay your loan while you’re enrolled could beef up your credit history, for example, and also stop interest from ballooning your balance.

Many LendKey partner lenders, however, lock you into this choice. They require borrowers — regardless of their financial situation or personal preference — to either make interest-only payments or fixed $25 payments while enrolled and after, while enjoying a grace period.

If you’d rather take the higher toll of accruing interest in exchange for the freedom to put off repayment, you might prefer a lender like College Ave, which offers four in-school repayment options, including full deferment.

You might need to join a credit union first

If your LendKey application directs you to select one or more credit unions, you will also have to apply — and pay for — membership at the credit union itself. The process isn’t especially difficult, and the costs can often be as low as $1-$5, but there’s more red tape here than if you elected to borrow from a bank or online-only lender.

If you don’t see a discounted rate or other unique benefits to joining and borrowing from a not-for-profit credit union, you might test the waters with no-fee online lenders, such as Ascent.

Are LendKey private student loans right for you?

When shopping around for a private student loan, we recommend comparing rates with at least three lenders. That way, you’ll find the least costly — or best overall — loan agreement for your borrowing needs.

You could qualify for relatively low interest rates from LendKey’s partner lenders. These community banks and credit unions also tack on one of the more generous forbearance policies available among private lenders.

On the downside, you might prefer full deferment to the in-school repayment options required by LendKey’s partners. More critically, you might wonder if the company lives up to its promise as a marketplace if it only connects you with a single lender, rather than a few.

Even if it doesn’t serve as a one-stop shop, however, you could consider LendKey one of the “lenders” you request quotes from before making your final decision. Additionally, if you like the idea of borrowing from a nonprofit lender like LendKey’s partners, you can also explore some of the other ways to find credit union student loans that are a good fit for you.

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2 Important Disclosures for College Ave.

CollegeAve Disclosures

College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.

(1)All rates shown include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.

(2)This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7% variable Annual Percentage Rate (“APR”): 96 monthly payments of $179.28 while in the repayment period, for a total amount of payments of $17,211.20. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.

(3)As certified by your school and less any other financial aid you might receive. Minimum $1,000.

Information advertised valid as of 5/22/2019. Variable interest rates may increase after consummation.


* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
3 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.

4 Important Disclosures for Discover.

Discover Disclosures

  1. At least a 3.0 GPA (or equivalent) qualifies for a one-time cash reward of 1% of the loan amount of each new Discover undergraduate and graduate student loan. Reward redemption period is limited. Please visit DiscoverStudentLoans.com/Reward for any applicable reward terms and conditions.
  2. View Terms and Conditions at DiscoverStudentLoans.com/AutoDebitReward.

5 Important Disclosures for SunTrust.

SunTrust Disclosures

Before applying for a private student loan, SunTrust recommends comparing all financial aid alternatives including grants, scholarships, and both federal and private student loans. To view and compare the available features of SunTrust private student loans, visit https://www.suntrust.com/loans/student-loans/private.

Certain restrictions and limitations may apply. SunTrust Bank reserves the right to change or discontinue this loan program without notice. Availability of all loan programs is subject to approval under the SunTrust credit policy and other criteria and may not be available in certain jurisdictions.

©2019 SunTrust Banks, Inc. SUNTRUST, the SunTrust logo and Custom Choice Loan are trademarks of SunTrust Banks, Inc. All rights reserved.

  1. Interest rates and APRs (Annual Percentage Rates) depend upon (a) the student’s and cosigner’s (if applicable) credit histories, (b) the repayment option and repayment term selected, (c) the requested loan amount and (d) other information provided on the online loan application. If approved, applicants will be notified of the rate applicable to your loan. Rates and terms effective for applications received on or after 5/1/2019. The current variable APRs for the program range from 4.251% APR to 11.300% APR and the current fixed APRs for the program range from 5.251% APR to 12.00% APR (the low APRs within these ranges assume a 7-year $10,000 loan, with two disbursements and no deferment; the high APRs within these ranges assume a 15-year $10,000 loan with two disbursements). The variable interest rate for each calendar month is calculated by adding the current One-month LIBOR index to your margin. LIBOR stands for London Interbank Offered Rate. The One-month LIBOR is published in the Money Rates section of The Wall Street Journal (Eastern Edition). The One-month LIBOR index is captured on the 25th day of the immediately preceding calendar month (or if the 25th is not a business day, the next business day thereafter), and is rounded up to the nearest 1/8th of one percent. The current One-month LIBOR index is 2.500% on 5/1/2019. The variable interest rate will increase or decrease if the One-month LIBOR index changes. The fixed rate assigned to a loan will never change except as required by law or if you request and qualify for the auto pay discount.
  2. Any applicant who applies for a loan the month of, the month prior to, or the month after the student’s graduation date, as stated on the application or certified by the school, will only be offered the Immediate Repayment option. The student must be enrolled at least half-time to be eligible for the partial interest, fully deferred and interest only repayment options unless the loan is being used for a past due balance and the student is out of school. With the Full Deferment option, payments may be deferred while the student is enrolled at least half-time at an approved school and during the six month grace period after graduation or dropping below half-time status, but the total initial deferment period, including the grace period, may not exceed 66 months from the first disbursement date. The Partial Interest Repayment option (paying $25 per month during in-school deferment) is only available on loans of $5,000 or more. For payment examples, see footnote 7. With the Immediate Repayment option, the first payment of principal and interest will be due approximately 30-60 calendar days after the final disbursement date and the minimum monthly payment is $50.00. There are no prepayment penalties.
  3. The 15-year term and Partial Interest Repayment option (paying $25 per month during in-school deferment) are only available for loan amounts of $5,000 or more. Making interest only or partial interest payments while in school deferment (including the grace period) will not reduce the principal balance of the loan. Payment examples within this footnote assume a 45-month deferment period, a six-month grace period before entering repayment and the Partial Interest Repayment option. 7-year term: $10,000 loan disbursed over two transactions with a 7-year repayment term (84 months) and 8.382% APR would result in a monthly principal and interest payment of $198.61. 10-year term: $10,000 loan disbursed over two transactions with a 10-year repayment term (120 months) and an 8.851% APR would result in a monthly principal and interest payment of $161.70. 15-year term: $10,000 loan disbursed over two transactions with a 15-year repayment term (180 months) and a 9.335% APR would result in a monthly principal and interest payment of $135.68.
  4. The 2% principal reduction is based on the total dollar amount of all disbursements made, excluding any amounts that are reduced, cancelled, or returned. To receive this principal reduction, it must be requested from the servicer, the student borrower must have earned a bachelor’s degree or higher and proof of such graduation (e.g. copy of diploma, final transcript or letter on school letterhead) must be provided to the servicer. This reward is available once during the life of the loan, regardless of whether the student receives more than one degree.
  5. Earn an interest rate reduction for making automatic payments of principal and interest from a bank account (“auto pay discount”). Earn a 0.25% interest rate reduction when you auto pay from any bank account and an extra 0.25% interest rate reduction when you auto pay from a SunTrust Bank checking, savings, or money market account. The auto pay discount will continue until (1) automatic deduction of payments is stopped (including during any deferment or forbearance) or (2) three automatic deductions are returned for insufficient funds during the life of the loan. The extra 0.25% interest rate reduction when you auto pay from a SunTrust Bank account will be applied after the first automatic payment is successfully deducted and will be removed for the reasons stated above. In the event the auto pay discount is removed, the loan will accrue interest at the rate stated in your Credit Agreement. The auto pay discount is not available when payments are deferred or when the loan is in forbearance, even if payments are being made.
  6. A cosigner may be released from the loan upon request to the servicer provided that the student borrower is a U.S. citizen or permanent resident alien, has met credit criteria and met either one of the following payment conditions: (a) the first 36 consecutive monthly principal and interest payments have been made on-time (received by the servicer within 10 calendar days after their due date) or (b) the loan has not had any late payments and has been prepaid prior to the end of the first 36 months of scheduled principal and interest payments in an amount equal to the first 36 months of scheduled principal and interest payments (based on the monthly payment amount in effect when you make the most recent payment). As an example, if you have made 30 months of consecutive on-time payments, and then, based on the monthly payment amount in effect on the due date of your 31st consecutive monthly payment, you pay a lump sum equal to 6 months of payments, you will have satisfied the payment condition. Cosigner release may not be available if a loan is in forbearance.
  7. If the student dies after any part of the loan has been disbursed, and the loan has not been charged off due to non-payment or bankruptcy, then the outstanding balance will be forgiven if the servicer is informed of the student’s death and receives acceptable proof of death. If the student becomes totally and permanently disabled after any part of the loan has been disbursed and the loan has not been charged off due to non-payment or bankruptcy, the loan will be forgiven upon the servicer’s receipt and approval of a completed discharge application. If the student borrower dies or becomes totally and permanently disabled prior to the full disbursement of the loan, and the loan is forgiven, all future disbursements will be cancelled. Loan forgiveness for student death or disability is available at any point throughout the life of the loan.

6 Important Disclosures for LendKey.

LendKey Disclosures

Additional terms and conditions apply. For more details see 


7 Important Disclosures for CommonBond.

CommonBond Disclosures

A government loan is made according to rules set by the U.S. Department of Education. Government loans have fixed interest rates, meaning that the interest rate on a government loan will never go up or down.

Government loans also permit borrowers in financial trouble to use certain options, such as income-based repayment, which may help some borrowers. Depending on the type of loan that you have, the government may discharge your loan if you die or become permanently disabled.

Depending on what type of government loan that you have, you may be eligible for loan forgiveness in exchange for performing certain types of public service. If you are an active-duty service member and you obtained your government loan before you were called to active duty, you are entitled to interest rate and repayment benefits for your loan.
If you are unable to pay your government loan, the government can refer your loan to a collection agency or sue you for the unpaid amount. In addition, the government has special powers to collect the loan, such as taking your tax refund and applying it to your loan balance.

A private student loan is not a government loan and is not regulated by the Department of Education. A private student loan is instead regulated like other consumer loans under both state and federal law and by the terms of the promissory note with your lender.
If you refinance your government loan, your new lender will use the proceeds of your new loan to pay off your government loan. Private student loan lenders do not have to honor any of the benefits that apply to government loans. Because your government loan will be gone after refinancing, you will lose any benefits that apply to that loan. If you are an active-duty service member, your new loan will not be eligible for service member benefits. Most importantly, once you refinance your government loan, you will not able to reinstate your government loan if you become dissatisfied with the terms of your private student loan.

If your private student loan has a fixed interest rate, then that rate will never go up or down. If your private student loan has a variable interest rate, then that rate will vary depending on an index rate disclosed in your application. If the interest rate on the new private student loan is less than the interest rate on your government loans, your payments will be less if you refinance.
If you are a borrower with a secure job, emergency savings, strong credit and are unlikely to need any of the options available to distressed borrowers of government loans, a refinance of your government loans into a private student loan may be attractive to you. You should consider the costs and benefits of refinancing carefully before you refinance.

If you don’t pay a private student loan as agreed, the lender can refer your loan to a collection agency or sue you for the unpaid amount.

Remember also that like government loans, most private loans cannot be discharged if you file bankruptcy unless you can demonstrate that repayment of the loan would cause you an undue hardship. In most bankruptcy courts, proving undue hardship is very difficult for most borrowers.


8 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Student Loan Rate Disclosure: Variable rate, based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of May 1, 2019, the one-month LIBOR rate is 2.48%. Variable interest rates range from 4.45%-12.42% (4.45% – 12.32% APR) and will fluctuate over the term of the loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a co-signer. Fixed interest rates range from 5.25%-12.19% (5.25% – 12.09% APR) based on applicable terms, level of degree earned and presence of a co-signer. Lowest rates shown requires application with a co-signer, are for eligible applicants, require a 5-year repayment term, borrower making scheduled payments while in school and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change. Please note: Due to federal regulations, Citizens Bank is required to provide every potential borrower with disclosure information before they apply for a private student loan. The borrower will be presented with an Application Disclosure and an Approval Disclosure within the application process before they accept the terms and conditions of the loan. 
  2. Citizens Bank Student Loan Eligibility: Borrowers must be enrolled at least half-time in a degree-granting program at an eligible institution. Borrowers must be a U.S. citizen or permanent resident or an international borrower/eligible non-citizen with a creditworthy U.S. citizen or permanent resident co-signer. For borrowers who have not attained the age of majority in their state of residence, a co-signer is required. Citizens Bank reserves the right to modify eligibility criteria at anytime. Interest rate ranges subject to change. Citizens Bank private student loans are subject to credit qualification, completion of a loan application/consumer credit agreement, verification of application information, and if applicable, self-certification form, school certification of the loan amount, and student’s enrollment at a Citizens Bank- participating school.  
  3. Co-signer Release: Borrowers may apply for co-signer release after making 36 consecutive on-time payments of principal and interest. For the purpose of the application for co-signer release, on-time payments are defined as payments received within 15 days of the due date. Interest only payments do not qualify. The borrower must meet certain credit and eligibility guidelines when applying for the co-signer release. Borrowers must complete an application for release and provide income verification documents as part of the review. Borrowers who use deferment or forbearance will need to make 36 consecutive on-time payments after reentering repayment to qualify for release. The borrower applying for co-signer release must be a U.S. citizen or permanent resident. If an application for co-signer release is denied, the borrower may not reapply for co-signer release until at least one year from the date the application for co-signer release was received. Terms and conditions apply. Borrowers whose loans were funded prior to reaching the age of majority may not be eligible for co-signer release. Note: co-signer release is not available on the Student Loan for Parents or Education Refinance Loan for Parents.
3.99%
11.32%
2
Undergraduate, Graduate, and Parents

Visit College Ave

4.50% – 11.35%*,3Undergraduate and Graduate

Visit SallieMae

4.84%
13.49%
4
Undergraduate and Graduate

Visit Discover

4.25% – 11.30%5Undergraduate and Graduate

Visit SunTrust

4.50% – 9.47%6Undergraduate and Graduate

Visit LendKey

3.74%
9.72%
7
Undergraduate, Graduate, and Parents

Visit CommonBond

4.45%
12.32%
8
Undergraduate, Graduate, and Parents

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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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