The Benefits of Applying for a Sallie Mae Student Loan
What primarily started as a government sponsored entity in 1972 with the sole motive of offering financial assistance in the form of a global scholarship to students is now the leading loan provider in the United States for students studying within the country or overseas.
The Sallie Mae student loans have been servicing college students for more than 30 years by providing them with crucial financial assistance as far as education loans are concerned. This federal loan which went private in 1997 enjoys more popularity among students because of their easy application procedure, consolidation process and friendly consultants providing crucial advice regarding financial aid. Besides the above mentioned, this type of loan offers favorable repayment policies and fairly low interest rates which are responsible for students choosing the Sallie Mae loans rather than seeking financial aid from other private or federal institutions like Federal Perkins Loan or even Federal Stafford Loan. Once your student loan has been approved by Sallie Mae, your school debts will be reduced by about 60%.
Being the most sought after institution providing financial aid, all thanks to its flexible payment options, Sallie Mae has helped more than thousands of students to cope with extremely high tuition fees and has till date managed to account for more than 10 million debts summing up to be an estimated amount of $126 Billion!
Qualifying for a Sallie Mae Student Loan
Sallie Mae has a strict eligibility criterion for students applying for financial aid for college. It clearly specifies that students will be eligible for the loan only if they’ve attended an eligible school and been a part of an eligible program. It also extends its assistance towards locals who choose to study abroad and for international students who wish to study in the States. In case of international students wishing to avail the loan, they must have a creditworthy cosigner who should be a citizen of the U.S or a permanent resident. Besides a cosigner, the borrower should also have appropriate U.S. Citizenship and immigration service documentation. The borrower must also closely meet all the current eligibility criteria besides credit and several other criteria.
The whole process of qualifying for a student loan for college can be dreadfully stressful and Sallie Mae seeks to ease the pressure on students during this crucial phase in their lives. It advises students to first lay thought towards the amount of money they need to borrow. Zeroing on a next to precise figure is important as overestimation will lead to more payments and more interest to be paid. Sallie Mae has a variety of lenders to choose from and the institution will intently advise you on the most feasible deal.
Sallie Mae vs Federal and Private Student Loan Programs
There are a variety of loans to cater to different needs and capabilities of the students. If the borrower happens to be an undergraduate responsible for loan repayment, the following are the loans available to him: Graduate Plus loan, Federal Stafford Loan, Continuing Education Loans and Parental Plus loans. Sallie Mae student’s loan doesn’t leave its potential borrowers stranded without any advice; they render professional financial assistance to the students in need.
Federal loans are very different from private loans; the sole difference is based on the “credit” feature and private loans are heavily based on credit. A student in his/her initial stages may not have sufficient credit reserve to meet the eligibility requirements and thus may need a cosigner, which are preferably the student’s parents. Sallie Mae offers a variety of loans like Sallie Mae Smart Option Student Loans, Career Training Loans, K12 Family Education Loans and Continuing Education Loans.
Now, having being introduced to the core facts relating to the Sallie Mae loans, it’s time we elaborate on the benefits of this system and why more people should resort to Sallie Mae. We already know that Sallie Mae has a flexible loan repayment procedure which many financial institutions lack. We’re also aware of the highly attractive low interest rates offered by this institution. The question is precisely HOW low and HOW flexible is the system of loan repayment.
The Repayment Options of Sallie Mae Student Loans
The smart Option Student Loan by Sallie Mae has a 3 tier repayment system: Interest Repayment, Fixed Repayment and Deferred Repayment.
Interest Repayment involves more money being paid at the present, when a student is most likely in school and a shorter repayment period after school. This option allows a student to save as much as $5,000 as compared to the deferred payment method. Also the repayment in full principal and interest starts after 6 months of leaving the school.
Fixed Repayment option involves a student to pay $25 per month so that later he/she can enjoy shorter payment periods. This option helps a student to save upto $2000 as compared to the deferred payment option.
The Deferred Repayment option is the most flexible option which allows the student to pay according to will and comfort.
The interest rates offered by Sallie Mae are competitive and attractive. The interest rate ranges from LIBOR + 2% to LIBOR + 9.88% with an APR of 2.25% and 9.37% respectively.
The interest rates on fixed payment options and deferred payment options are considerably higher than that of fixed repayment option. Moreover, there are no penalties relating to prepayment nor is there any fee for origination.
Sallie Mae’s policy of rewarding timely repayments works wonders in attracting more applications and timely payments. A 2% Smart Reward is achieved by a student in his UPromise account if has taken up interest or fixed repayment option on making timely monthly payments in school. Also, if a student makes scheduled monthly payments via automatic debit, he/she is entitled to a 0.25% of interest rate reduction.
The loan limit stands at a 100% borrow up of the certified costs of education of your school.
Sallie Mae also extends a new and exciting offer which promises of covering upto $5000 for all the tuition missed by the student in wake of a serious medical condition leading to withdrawal from the school.
Sallie Mae has an organized method of calculating all the costs related to loan repayment besides having an efficient education investment planner.