Choosing a Stafford Loan Lender

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i just spoke with citi, chase, and T.H.E. reps today and it seems like citi gave me the best deal with
-1% origination fee
-1% default fee
- interest capitalizes once upon repayment and once after forbearance
-0.5% Interest rate reduction upon repayment
-0.25% reduction with automatic debit
-last six payments picked up by citi (seems like significant savings if they actually honor this)

citi is not on my school's list of preferred lenders though. i'm not sure if this will be a problem. what qualities does the school use to make a lender "preferred" anyway?

BTW, when i spoke with chase, they told me i would have 1.5% origination fee, 1% default fee, and just the typical 0.25% IRR so citi seems like a better deal.
any thoughts?
Members don't see this ad.
 
SO I am between Citi and Bank of America.

Citi has 1% orig. and 1% default
BOA has 1% orig. and 0% default.

Both of .25% reduction

But Citi has another .5% reduction and you get to skip the last 6 payments.

So with BOA, I save 1% off my loan, but with Citi i get those reduction, which probably add up to more in the long run - but I don't know if It will be definite by the time i pay back my loans.

ANy advice?
 
General question: everyone's comparing lender benefits, but as we've seen recently, they can change at the drop of a hat. Does anyone know which lender benefits we'll actually get when we're in repayment? Those at the time of MPN signing, at graduation, at repayment? Can they change once we're in repayment? If they can change so easily, then it really seems like it's a shot in the dark because there's no way to tell what the benefits will be when we're finally in repayment.
 
Members don't see this ad :)
since we're debating the default fees here......
if I take out $40k in federal stafford loans, won't the default fee on this be ~$400? If so, isn't citi a better deal than BOA if citi allows you to get .5% IRR and skip the last 6 payments (assuming they actually honor these benefits at the time of repayment)?
 
Is anyone going to go with EdAmerica? I think I am settling on them.
 
Yes it's true that the .5 will add up to more in the long run....but all i hear is that these incentives can go away so I wasn't sure what to do?
 
Sorry for my ignorance. I have few general questions here.

I have one acceptance but I am still waiting for two waitlists from schools I liked more.
The FinAid office of the school that accepted me requsted that I do my Mater Promissory Note as soon as possible meaning I have to chose the lender for my Stafford loan.
The questions:

After I submit my MPN could I not take this loan at all? Or does submitting of MPN equal signing the loan contract?
Is that possible to use the loan for another school after you submit the MPN if you get accepted just before the school starts?
Until what time could I possibly change the lender or is that impossible after I submit MPN?

Also, as I understood, I would not get a detailed financial aid letter with all the loan possibilities, grants and scholarships until I submit my MPN. How could people compare there FianAid offers in cases of multiple accepances then?

Thank you very much!
 
Chase is now changing the terms retroactively. I just called yesterday to make sure everything was fine, and they said that, even though my loans were certified in May, they are now going to charge me an origination and default fee and repayment bonus is going to be only .25%, not 1% anymore. So check with them even though you had all the paperwork done by the end of May. I am now looking at Discover and Edamerica.
As I said once before, chase sucks. They have been, at best, extremely misleading in this whole process.:thumbdown: If you applied for their loans call them and check for yourself, you're not going to be happy. There is still plenty of time to change lender. Good luck!
 
plauto said:
Chase is now changing the terms retroactively. I just called yesterday to make sure everything was fine, and they said that, even though my loans were certified in May, they are now going to charge me an origination and default fee and repayment bonus is going to be only .25%, not 1% anymore. So check with them even though you had all the paperwork done by the end of May. I am now looking at Discover and Edamerica.
As I said once before, chase sucks. They have been, at best, extremely misleading in this whole process.:thumbdown: If you applied for their loans call them and check for yourself, you're not going to be happy. There is still plenty of time to change lender. Good luck!
Click to expand...
That is bull$hit. What did the paperwork say about origination fees? They can't charge an origination fee if it isn't in the contract.
 
Sol Rosenberg said:
That is bull$hit. What did the paperwork say about origination fees? They can't charge an origination fee if it isn't in the contract.
Click to expand...

well, again the problem is that the MPN (the contract) does not say anything about these things. What ticked me off is that they said that loans certified by June 1st would not be charged any fees, while now they are saying (well actually you have to call them to find out:confused:) that instead they are ignoring what they said, and will charge fees no matter what because the loans are going to be disbursed in August.
3rd week of May I applied for the loans and my school certifed them the next day. I thought I was all set and was assured no origination and defalut fees would be charged. Well, apparently things were different and in June they went back retroactively and charged fees anyway.

Basically that big ad they had on their webpage about 0% fees and 1% interest reduction at repayment was all crap. Those benefits started in mid May and stopped at the end of May. How many med students had their loans certified and disbursed in those 2 weeks? At least the other lenders were upfront with their fees and such....Chase is trying to take us for a ride :thumbdown: Don't let them.
 
Last edited:
I just called EdAmerica and, in regards to origination fees, they charge 1.5% for loans dispersed before July 1 and 1% for loans dispersed after July 1.
 
is there a way to get these benefits in writing? I read somewhere that you need to get them in writing to qualify.
 
Members don't see this ad :)
Stafford Loans

0 % orig. fee
1 % default fee
2 % reduction in interest rate AFTER 24 payments
0.25% reduction with autopayments

Hard to beat!:luck:
 
DDS Nuke said:
Stafford Loans

0 % orig. fee
1 % default fee
2 % reduction in interest rate AFTER 24 payments
0.25% reduction with autopayments

Hard to beat!:luck:
Click to expand...
Link?
 
tinkerbelle said:
DDS Nuke- They didn't mention a 1% default fee when I called them a few weeks ago. Are you sure about this?
Click to expand...

They added the requisite "depending on your school"...I didn't mention my school since I was so blown away with the no origination fee and 2% reduction...it didn't matter at that point...sign me up! :D
 
DDS Nuke said:
They added the requisite "depending on your school"...I didn't mention my school since I was so blown away with the no origination fee and 2% reduction...it didn't matter at that point...sign me up! :D
Click to expand...

I am going to call them on Tuesday...do you have to be a Navy employee/member of relative of one to qualify?
I could not find it on their website, but you never know. It says that the .25% off for automatic payment is taken off no matter what bank you use.
 
plauto said:
do you have to be a Navy employee/member of relative of one to qualify?
Click to expand...

Yes, you don't have to have your auto payments from NFCU to get that extra 0.25% off...not sure if you even have to be a member of NFCU to get the loan in the first place then...?


Navy Federal's field of membership is determined by the National Credit Union Administration. If you are in any of these categories, you are eligible to join:
  • All Department of Defense (DoD) uniformed personnel—Army, Navy, Marine Corps and Air Force, retirees and annuitants
  • All Department of Defense Reservists—Army, Navy, Marine Corps and Air Force—regardless of drill status—retirees and annuitants
  • All Army and Air National Guard Personnel—regardless of drill status—civilian employees, retirees and annuitants
  • All DoD Officer Candidate programs: Midshipmen and cadets at the United States Naval Academy, United States Military Academy, United States Air Force Academy, United States Coast Guard Academy and the United States Merchant Marine Academy; Other Officer Programs
  • U.S. Government employees assigned to DoD installations (including Coast Guard)
  • All DoD civilian employees
  • DoD contractors assigned to U.S. Government installations
  • Family Members, including grandparents, parents, spouses, siblings, grandchildren, children (including adopted, foster and stepchildren) and household members
Once your family members have joined, they can extend the membership opportunity to their family members, too.
 
I am looking for things that charge neither origination nor default, but I can't find that. Seems like the loan that my school signed me up for automatically (Suntrust) is the best choice. Apparently for Pennsylvania students, it doesn't charge an origination fee, but there is a 1% default fee, and your standard reductions that most loans have nowadays (.25% and .5%, I forget for what).

If anyone finds a loan I could use in Pennsylvania with no origination and no default, PM me please (I looked at Bank of america, but my school doesn't participate in their program).
 
bacillus1 said:
I am looking for things that charge neither origination nor default, but I can't find that. Seems like the loan that my school signed me up for automatically (Suntrust) is the best choice. Apparently for Pennsylvania students, it doesn't charge an origination fee, but there is a 1% default fee, and your standard reductions that most loans have nowadays (.25% and .5%, I forget for what).

If anyone finds a loan I could use in Pennsylvania with no origination and no default, PM me please (I looked at Bank of america, but my school doesn't participate in their program).
Click to expand...

Discover
 
plauto said:
I am going to call them on Tuesday...do you have to be a Navy employee/member of relative of one to qualify?
I could not find it on their website, but you never know. It says that the .25% off for automatic payment is taken off no matter what bank you use.
Click to expand...

well, I checked and yes, you do have to be a member of the Navy/Army/ Airforce etc.
 
plauto said:
well, I checked and yes, you do have to be a member of the Navy/Army/ Airforce etc.
Click to expand...
This isn't true. Read the above from DDS Nuke's post:

Navy Federal's field of membership is determined by the National Credit Union Administration. If you are in any of these categories, you are eligible to join:
All Department of Defense (DoD) uniformed personnel—Army, Navy, Marine Corps and Air Force, retirees and annuitants
All Department of Defense Reservists—Army, Navy, Marine Corps and Air Force—regardless of drill status—retirees and annuitants
All Army and Air National Guard Personnel—regardless of drill status—civilian employees, retirees and annuitants
All DoD Officer Candidate programs: Midshipmen and cadets at the United States Naval Academy, United States Military Academy, United States Air Force Academy, United States Coast Guard Academy and the United States Merchant Marine Academy; Other Officer Programs
U.S. Government employees assigned to DoD installations (including Coast Guard)
All DoD civilian employees
DoD contractors assigned to U.S. Government installations
Family Members, including grandparents, parents, spouses, siblings, grandchildren, children (including adopted, foster and stepchildren) and household members
Once your family members have joined, they can extend the membership opportunity to their family members, too.
 
Guile said:
This isn't true. Read the above from DDS Nuke's post:

Navy Federal's field of membership is determined by the National Credit Union Administration. If you are in any of these categories, you are eligible to join:
All Department of Defense (DoD) uniformed personnel—Army, Navy, Marine Corps and Air Force, retirees and annuitants
All Department of Defense Reservists—Army, Navy, Marine Corps and Air Force—regardless of drill status—retirees and annuitants
All Army and Air National Guard Personnel—regardless of drill status—civilian employees, retirees and annuitants
All DoD Officer Candidate programs: Midshipmen and cadets at the United States Naval Academy, United States Military Academy, United States Air Force Academy, United States Coast Guard Academy and the United States Merchant Marine Academy; Other Officer Programs
U.S. Government employees assigned to DoD installations (including Coast Guard)
All DoD civilian employees
DoD contractors assigned to U.S. Government installations
Family Members, including grandparents, parents, spouses, siblings, grandchildren, children (including adopted, foster and stepchildren) and household members
Once your family members have joined, they can extend the membership opportunity to their family members, too.
Click to expand...

That's why I wrote etc. in my post
 
bacillus1 said:
I am looking for things that charge neither origination nor default, but I can't find that. Seems like the loan that my school signed me up for automatically (Suntrust) is the best choice. Apparently for Pennsylvania students, it doesn't charge an origination fee, but there is a 1% default fee, and your standard reductions that most loans have nowadays (.25% and .5%, I forget for what).

If anyone finds a loan I could use in Pennsylvania with no origination and no default, PM me please (I looked at Bank of america, but my school doesn't participate in their program).
Click to expand...

National City.
 
If you don't have your loans already I have found Discover to be the only one who doesn't charge Orig and default fees after July 1. If there are any others I would love to know of them. Discover said the they are new to the student loan (1 1/2 yrs) They are loosing money on the loans but hope to make it up no the credit card end..... ( get your data and try to get you to apply for a credit card at a higher rate .... I was told this by another lender) They also use Great Lakes as a guarantor. But the new memo is that they are charging a default fee (Discover says that they are covering that fee) They don't sell their loans so you will always be with Discover. On the Grad plus they are charging 8.25% with .25 for auto payment. I am a little concerned what I have read about all the rates changing after I sign up and have to start all over. any feed back thank you
 
It seems your right about discover, it is a very interesting choice. I ended up going with Chase after a lot of looking around, their was nothing special about the loan. I wanted to choose a large bank with a long history of student loans. Honestly in this market it seems like every loan is nearly the same. (I did not know about the discover loan until i had already chosen chase).
 
kunfu said:
It seems your right about discover, it is a very interesting choice. I ended up going with Chase after a lot of looking around, their was nothing special about the loan. I wanted to choose a large bank with a long history of student loans. Honestly in this market it seems like every loan is nearly the same. (I did not know about the discover loan until i had already chosen chase).
Click to expand...
If they haven't funded you can change and save the money.
 
Yahoo! Discover added my school, so I switched.
 
lucky lady said:
If you don't have your loans already I have found Discover to be the only one who doesn't charge Orig and default fees after July 1. If there are any others I would love to know of them. Discover said the they are new to the student loan (1 1/2 yrs) They are loosing money on the loans but hope to make it up no the credit card end..... ( get your data and try to get you to apply for a credit card at a higher rate .... I was told this by another lender) They also use Great Lakes as a guarantor. But the new memo is that they are charging a default fee (Discover says that they are covering that fee) They don't sell their loans so you will always be with Discover. On the Grad plus they are charging 8.25% with .25 for auto payment. I am a little concerned what I have read about all the rates changing after I sign up and have to start all over. any feed back thank you
Click to expand...

Rates changin? For Gradplus and new stafford they are all fixed. Interest rate changes won't affect them.
 
I heard a rumor that chase retroactively changed the terms on our loans to include an origination fee, etc. I think I'm going to call them tomorrow.
 
It's not a rumor. Definitely a 1% origination fee, a possible 1% default fee. That is actually different for every person, b/c different groups guarantee the loans. Look at Discover.
 
ToasterThief said:
I heard a rumor that chase retroactively changed the terms on our loans to include an origination fee, etc. I think I'm going to call them tomorrow.
Click to expand...
They aren't retroactively changing the terms. They added the fees if your loan was guaranteed after June 1. Call them and ask about your specific account though to be sure. If you applied before June 1 but your school didn't certify the loan in time, then you might have the fees.
 
Found out my loan hadn't been certified yet, so I canceled with chase and am going with Discover. Signed my MPN and such. The one caveat is that Discover is not on my school's list of recommended lenders, so it seems like I'll have to jump through a few hoops. What should I do to make sure this is as painless as possible?
 
ToasterThief said:
Found out my loan hadn't been certified yet, so I canceled with chase and am going with Discover. Signed my MPN and such. The one caveat is that Discover is not on my school's list of recommended lenders, so it seems like I'll have to jump through a few hoops. What should I do to make sure this is as painless as possible?
Click to expand...
I would recommend calling and emailing as much as possible until you know everything's set. Don't assume that it will be taken care of. If everything is good to go on Discover's end, call or email your fin aid department and ask them what you should do to make sure the funds show up on the first day of class. If they say they've done everything they need to do, call Discover, have them look up your account (so you don't get generic advice) and make sure your school has done everything they should do.
 
It looks like citi went up to 2.5% fees and no more forgiveness of the last 6 months of payments

Every time I go to choose a lender, new crap unfolds

So Discover is looking the best with no fees, but they seem unstable for future lending, as they have only been in this for a short time and I've heard they are losing money......................
 
Well, if they don't start charging fees until next year or they go out of the loan business, then you will still have gotten through this year without fees. 2.5% isn't necessary yet, I don't think. There are plenty of 2% lenders, though that isn't much better.
 
Do people ever change lenders from year to year?
 
Is Discover still the best lender? I looked on their webpage and it says that they only give $20,500 for the stafford loan, so what if that's not enough to pay for medical school, do people get a second lender? And is the $20,500 the total limit or the limit each year? I don't know much about the whole stafford loan deal, so any answers would be helpful.
 
megamega said:
Is Discover still the best lender? I looked on their webpage and it says that they only give $20,500 for the stafford loan, so what if that's not enough to pay for medical school, do people get a second lender? And is the $20,500 the total limit or the limit each year? I don't know much about the whole stafford loan deal, so any answers would be helpful.
Click to expand...

That limit is for graduate school in general. The stafford limit for medical school is ~$40500 - can't remember the exact number. If your COA as determined by your school is above this limit, then you must utilize private loans. As far as I know Discover is pretty much the only one still offering zero fee loans. There might be a couple others. Haven't looked into it since I'm an M4. Just check around the internet.
 
akpete said:
That limit is for graduate school in general. The stafford limit for medical school is ~$40500 - can't remember the exact number. If your COA as determined by your school is above this limit, then you must utilize private loans. As far as I know Discover is pretty much the only one still offering zero fee loans. There might be a couple others. Haven't looked into it since I'm an M4. Just check around the internet.
Click to expand...

:thumbup:

Yeah $40,500 or more (for longer school years) in medical school. The lower amount is just for grad school. Also remember that grad plus has no limit but of course the total of your FA can't be more than the CoA. These days it is nearly impossible to get private loans above the CoA so don't count on that. The best route is through the FA department increasing your CoA for necessary expenses.
 
i wish they were offering us all this cool stuff now :(
 
Is Discover still the best? I'm loathe to change lenders for a second time, but I will to save money...
 
updates/opinions?

My school shows Access, Chase, EdAmerica, and Sallie Mae as preferred lenders but it looks like a lot of people like Discover on here. Any opinions on any of these lenders?
 
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