Alternatives to TD Bank 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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1.87% to 11.97% 2

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0.94% to 11.44% 3

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  • Variable APR

With 24 million customers internationally and approximately 1,300 branches in the U.S., TD Bank bills itself as “America’s most convenient bank.” But how convenient are TD Bank student loans?

Although many savers and investors find what they’re looking for at TD, there is currently no such thing as TD Bank student loans. On the other hand, there are some solid alternatives that could give you something close to what a student loan at TD Bank might look like, if it existed.

Alternatives to TD Bank student loans

Although you can’t find a student loan at TD Bank, this lender does offer another way to pay for your child’s college education. The East Coast-concentrated bank offers Home Equity Lines of Credit (HELOC) to homeowners footing the bill for tuition. (Conversely, it doesn’t allow borrowers to use closed end loans like its personal loan product to cover education costs.)

A HELOC is different from a student loan in a couple of important ways:

  • It’s an open-ended (revolving) debt, so you can borrow as needed by tapping into your home’s equity
  • It’s a form of secured debt, meaning that if you fail to repay it, the bank could seize the collateral (your home)

Also, if you have the credit score (or a creditworthy cosigner) to nab a low HELOC interest rate, keep in mind that you could probably score an even lower rate on a student loan — without risking your home in the process.

Review your federal student loan options

Whether you’re considering a loan from TD Bank or one of its competitors, you’ll likely be best off exhausting your federal student aid options first, before resorting to private loans. You could find grants that don’t need to be repaid and work-study programs that could lessen your borrowing. Beyond that, you could take out federal loans that come with unique protections like income-driven repayment (IDR).

Student borrowers can qualify to receive $5,500 to $12,500 in Direct Loans per school year. Parent (and graduate school) borrowers can borrow additional funds via the PLUS Loan program in order to cover the remaining cost of attendance.

While an adverse credit history could prevent you from borrowing a PLUS Loan, interest rates for all federal loans are one-size-fits-all, regardless of your credit score.

But a TD Bank-like lender could become the right option if you find yourself needing to borrow more than Uncle Sam will lend, or if you discover you could score a significantly lower interest rate from a private bank, credit union or online lender.

Just remember that chasing a lower rate elsewhere means you’ll give up federal loan safeguards like IDR and routes to student loan forgiveness that aren’t likely offered with private loans.

Consider a private student loan from TD Bank-like lenders

As the sixth-largest bank in the U.S., TD Bank provides its customers with the ability to accomplish most of their financial goals under one roof, whether they seek to save up, buy a home, retire comfortably or achieve something in between.

The lender also provides competitive rates, in-person customer support and online education.

The two banks listed below offer all that too — but unlike TD, they also have actual student loan options. Although both lenders have student loan products with fixed and variable rates, they’re similarly light on fees and boast 15-minute online applications.

1. SunTrust Bank

With branches in nine states and Washington D.C., SunTrust offers many of the flexible terms you’ll find from top-rated private lenders: four in-school repayment options, three repayment terms (7, 10 or 15 years) and cosigner release after 36 to 48 months of timely payments.

The cherry on top is that borrowers could receive additional discounts or awards for graduating and staying current with their balance.

2. Citizens Bank

Also offering multi-year approval for in-school loans, Citizens Bank opens its doors to parent borrowers as well as international students piggybacking on a cosigner. (Note, however, that the lender allows only American citizen or permanent resident borrowers to release their cosigner, which becomes an option after 36 months of prompt payments.)

At the outset, you could select a loan term of 5, 10 or 15 years.

If you’re not sure about the loan details and want to consult a knowledgeable bank representative in person, Citizens could be your best bet: It boasts 1,100 locations across 11 states.

Choose the best alternative to TD Bank student loans

With nearly $70 billion in assets from personal loans on its balance sheet, TD Bank is a real boon to borrowers — just not for those borrowing strictly for education costs. If its HELOC offering isn’t appealing to you, look elsewhere for a private student loan.

But remember to at least review your federal loan options first. Although you might be able to score a lower rate than what the Education Department awards uniformly, you’ll give up repayment safeguards that can’t be matched elsewhere.

If you do need to borrow from a private bank, credit union or online company, make sure it meets all of your needs before signing on the dotted line. Go beyond the rate quote and ask the hard questions, like what sort of support the lender offers if you were to struggle in repayment.

As you shop around, keep the highest-ranked private lenders in mind.

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