4 Best Private Student Loan Companies for Parents in 2018

student loan companies

If you’re a parent who’s interested in helping your child pay for college, you might be in for a rude awakening. The cost of college has skyrocketed since you attended college, and you could be on the hook for anywhere between $3,520 to $33,480 per year, on average.

If you need to borrow money to pay for your kid’s college, a Parent PLUS Loan is often the best option. With the ability to consolidate the loans to get access to income-driven repayment plans and the Public Service Loan Forgiveness Program, you’ll have a lot of repayment flexibility.

But some private student loan companies offer lower interest rates than Parent PLUS Loans. Plus, you might be able to escape the latter’s 4.624 percent origination fee.

To help you sift through all the student loan companies that offer parent loans, we’ve put together some private student loans reviews for our top choices.

4 best student loan companies for parents

As you compare the following private student loans for parents, consider the interest rates, fees, and other terms and features to determine which option is best for you.

One thing to keep in mind: A search for the best private student loans for bad credit will prove futile. You typically need a decent credit score or a cosigner to qualify.

Lender Variable Interest Rates Fixed Interest Rates Repayment Terms Notes
SoFi 4.02% APR to 7.445% APR 4.25% APR to 8% APR Five or 10 years Doesn’t allow interest-only payments while your child is in school.
College Ave 4.33% APR to 9.31% APR 6.62% APR to 10.57% APR Five to 12 years in one-year increments Sends you money directly to cover non-tuition expenses.
Sallie Mae 5.12% APR to 11.49% APR 5.74% APR to 12.87% APR 10 years Doesn’t allow you to pre-qualify with a soft credit check.
Citizens Bank N/A 6.64% APR to 7.24% APR Five or 10 years Offers an extra 0.25% interest rate reduction if you have an eligible Citizens Bank account.

1. SoFi Parent Loan

SoFi is one of the largest student loan refinancing companies in the industry, but it also offers private student loans. Its parent loan is one of the cheapest in terms of interest rates and fees.

Interest rates and fees

You have the choice between a variable and fixed interest rate, as of January 2018:

  • Variable: 4.02% APR to 7.445% APR
  • Fixed: 4.25% APR to 8.00% APR

Note that these rates include a 0.25% reduction, which you qualify for when you set up autopay. Also, you can get an idea of what kind of rate you qualify for without a hard credit check.

The lender charges no application or origination fees and no prepayment penalties.

Other terms and features

You can borrow as little as $5,000 or enough to cover the cost of attendance for your child.

One big drawback to the SoFi parent loan is that you can’t defer the loan until after your child graduates. Your first payment will be due within 30 to 45 days after you receive the funds. You can, however, choose between a five-year and 10-year repayment term.

2. College Ave Parent Loan

If you want a little more flexibility with your payments, College Ave offers three repayment plans you can choose from:

  • Interest-only payment: Pay just the interest charges while your child is in school and start making payments in earnest after they graduate.
  • Interest-plus payment: Pay enough to cover the interest charges. You can choose what to pay on top of that amount in $20 increments.
  • Full principal and interest payment: Start making the full payments right away instead of waiting.

Interest rates and fees

Although they aren’t as low as SoFi’s rates, College Ave’s interest rates are competitive. As of January 2018, you can choose between the following variable and fixed interest rates:

  • Variable: 4.33% APR to 9.31% APR
  • Fixed: 6.62% APR to 10.57% APR

Note that these rates include a 0.25% interest rate reduction for setting up autopay. You can get pre-qualified for an interest rate through the lender’s website with a soft credit check, which won’t hurt your credit score.

You don’t have to worry about application or origination fees or prepayment penalties.

Other terms and features

College Ave parent loans start at $2,000 and can cover up to 100 percent of the school’s cost of attendance. The lender also offers to send you up to $2,500 directly to cover other required expenses.

When it comes to repaying your loan, you can choose a term of five, six, seven, eight, nine, 10, 11, or 12 years. In addition to the lender’s initial payment options, this feature allows you more flexibility than many student loan companies offer.

However, if you can qualify for a lower interest rate elsewhere, it might be worth giving up some repayment flexibility.

3. Sallie Mae Parent Loan

If you need a smaller loan amount, Sallie Mae offers parent loans as low as $1,000 and up to your child’s school-certified cost of attendance. The lender also allows you to choose between an interest-only payment while your child is in school or a full payment from the get-go.

Interest rates and fees

Sallie Mae offers both variable and fixed interest rates. As of January 2018, you might qualify for a rate within the following ranges:

  • Variable: 5.12% APR to 11.49% APR
  • Fixed: 5.74% APR to 12.87% APR

The lender also offers a 0.25% interest rate reduction when you set up autopay, which isn’t reflected in these rates. Like the other lenders listed, Sallie Mae doesn’t charge an application or origination fee and won’t penalize you for paying off your loan early.

Other terms and features

One drawback to the Sallie Mae parent loan is that it doesn’t allow you to pre-qualify with a soft credit check. That means you have to apply to find out what kind of rate you’d qualify for.

If you’re concerned about inquiries on your credit report, Sallie Mae might not be the best fit.

You also have only one choice for your repayment period: 10 years. Of course, you can pay off the loan earlier if you wish, but you have less flexibility when determining your monthly payment.

4. Citizens Bank Student Loan for Parents

If you’re already a Citizens Bank customer, applying for its student loan for parents could score you a lower interest rate.

In addition to its 0.25% interest rate reduction for signing up for autopay, the bank also offers an extra 0.25% discount if you have a qualifying account when you apply for the loan.

Interest rates and fees

Unlike the other student loan companies on our list, Citizens Bank doesn’t offer variable interest rates for its parent loan.

As of January 2018, its fixed interest rates range from 6.64% APR to 7.24% APR. Note that these rates include the full 0.50% rate reduction for the loyalty and autopay discounts.

Citizens Bank doesn’t charge any application or origination fees, and there’s no prepayment penalty.

Other terms and features

With Citizens Bank, you can choose between a five-year and 10-year repayment plan. You also can choose to pay interest only while your child is in school or start making full payments immediately.

Also, like Sallie Mae, Citizens Bank doesn’t allow you to see your interest rate offer until you officially apply. That can make it harder to shop around.

Which private student loans for parents are best?

Out of all the student loan companies that offer parent loans, there’s no one best lender for everyone. Each lender has different features and criteria for determining your loan terms. While one might offer lower interest rates, that doesn’t mean you’ll qualify for them.

To make sure you get the best deal on your parent loan, shop around and compare different companies and what they have to offer. For companies that offer pre-qualification, fill out the application to get an idea of what interest rate you’d qualify for. As you do this with several companies, you’ll have a better idea of which loan is best for you.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderRates (APR)Loan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
  2. Personal LoansFixed rates from 5.49% APR to 14.24% APR (with AutoPay). Variable rates from 4.98% APR to 11.44% APR (with AutoPay). SoFi rate ranges are current as of December 21, 2017 and are subject to change without notice. Not all rates and amounts available in all states. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 4.98% APR assumes current 1-month LIBOR rate of 1.34% plus 3.89% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

2 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Personal Loan Rate Disclosure: Fixed interest rates range from 5.99% – 16.24% (5.99% – 16.24% APR) based on applicable terms and presence of a co-applicant. Lowest rates shown are for eligible applicants, require a 3-year repayment term, 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.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Discount: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.
7.39% - 29.99%$1,000 - $50,000
Check rate nowon SLH's secure site
4.98% - 14.24%1$5,000 - $100,000
Check rate nowon SLH's secure site
8.00% - 25.00%$5,000 - $35,000
Check rate nowon SLH's secure site
5.99% - 16.24%2$5,000 - $50,000Visit Citizens
5.99% - 35.89%$1,000 - $40,000Visit LendingClub
5.25% - 14.24%$2,000 - $50,000Visit Earnest
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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 and will make a positive impact in your life. 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, understand what you are buying, and consult 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. Please do your homework and let us know if you have any questions or concerns.