Choosing the right student loan lender is a crucial step in financing higher education. Sallie Mae and College Ave are two prominent names in the private student loan market, each offering a range of loan products designed to meet diverse educational needs. Both lenders provide competitive interest rates and flexible repayment options, but they also have distinct features that may make one a better fit for you than the other.
College Ave is recognized for its graduate school student loan offerings and generally lower starting fixed annual percentage rates (APRs). Sallie Mae, on the other hand, stands out by providing more extended repayment periods for certain loans and greater flexibility for students who are not enrolled full-time. Crucially, both Sallie Mae and College Ave do not charge origination fees and offer forbearance options, providing some financial relief during challenging times.
Deciding between College Ave and Sallie Mae hinges on your individual academic and career aspirations, as well as your preferred pace for repaying your loan after graduation. This comprehensive comparison will delve into the nuances of each lender to assist you in making an informed decision.
Sallie Mae vs. College Ave: A Quick Comparison
To begin, let’s look at a side-by-side comparison of Sallie Mae and College Ave across key features:
| Feature | Sallie Mae | College Ave |
|---|---|---|
| Interest Rates (with autopay) | Variable APR: 5.37% – 15.70%; Fixed APR: 4.25% – 15.49% | Variable APR: 4.54% – 17.99%; Fixed APR: 3.47% – 17.99% |
| Repayment Terms | 10 to 15 years | 5 to 15 years (up to 20 years for some graduate programs) |
| Loan Amounts | $1,000 up to the full cost of attendance | $1,000 up to the full cost of attendance (maximum of $150,000 for certain degrees) |
| Key Benefits | Scholarship search tools, financial planning resources for college, quarterly FICO credit score updates, loans for part-time students | Extended deferment for fellowships or residencies, multiple in-school repayment choices, lower minimum APRs |
| Potential Drawbacks | Reports of unsatisfactory customer service, limited repayment term choices, unclear eligibility criteria | Reports of unsatisfactory customer service, $150,000 loan limit for some graduate degrees, limited transparency on eligibility |
Sallie Mae Student Loans: Ideal for Non-Traditional Students
Rating: 4.6 out of 5 stars
Learn more about Sallie Mae student loans in Bankrate’s detailed review.
Sallie Mae has established itself as a well-known private student loan provider, particularly notable for being one of the few lenders that offer loan options to students pursuing education on a part-time basis. This makes Sallie Mae a valuable resource for financing various educational pursuits, such as summer courses, online programs, study abroad opportunities, and professional certification programs, which may not always fit the full-time enrollment mold.
Pros of Sallie Mae Student Loans
- Part-Time Student Eligibility: A significant advantage of Sallie Mae is that you do not need to be enrolled as a full-time student to qualify for their loans. This opens doors for students with diverse enrollment statuses.
- Extended Terms for Residency Loans: For students in medical or dental residencies, Sallie Mae offers a 20-year repayment term, providing more manageable monthly payments during lower-income periods.
- Short Co-signer Release Period: Sallie Mae offers a relatively short co-signer release period, potentially freeing co-signers from their obligations sooner as the borrower establishes creditworthiness.
Cons of Sallie Mae Student Loans
- Limited Transparency on Eligibility: Sallie Mae’s website provides limited information regarding specific eligibility requirements, which can make it challenging for borrowers to assess their chances of approval upfront.
- Unclear Forbearance Policy: Details regarding Sallie Mae’s forbearance policy are not readily available, which could be a concern for borrowers seeking clarity on options during financial hardship.
- Limited Short Repayment Term Options: Compared to some competitors, Sallie Mae offers fewer short repayment term options, potentially limiting flexibility for borrowers aiming for quicker loan payoff.
College Ave Student Loans: Top Choice for Graduate Studies
Rating: 4.5 out of 5 stars
Explore College Ave student loan options through Bankrate’s in-depth review.
College Ave distinguishes itself with highly customizable loan products catering to both traditional and career-focused educational paths. This flexibility, combined with competitive student loan interest rates, has earned College Ave accolades, including Bankrate’s award for best student loans for graduate students. Furthermore, College Ave provides a student loan refinance option with terms up to 15 years, allowing borrowers to adjust their loan terms if rates decrease or their financial situations change.
Pros of College Ave Student Loans
- Fast Application Process: College Ave is known for its streamlined and quick application process, making it convenient for students needing prompt loan decisions.
- Competitive Rates for Parent Loans: College Ave offers particularly competitive interest rates on parent loans, making it an attractive option for parents helping to finance their children’s education.
- Multi-Year Loan Approval: College Ave offers the convenience of multi-year loan approval, simplifying the borrowing process for students needing funding for multiple academic years.
Cons of College Ave Student Loans
- Higher Refinance Rates Compared to New Loans: While refinancing is an option, College Ave’s refinance rates may be higher than their rates for new student loans.
- No Income-Driven Repayment Plans: College Ave does not offer income-driven repayment plans, which could be a disadvantage for borrowers seeking payment flexibility based on their income levels.
- No Grace Period for Parent Loans: Parent loans from College Ave do not come with a grace period, meaning payments typically begin shortly after disbursement.
Deep Dive Comparison: College Ave vs. Sallie Mae
While both Sallie Mae and College Ave are reputable lenders with a history of supporting higher education financing, understanding the finer details of their loan offerings is essential for making the optimal choice for your unique circumstances.
APR Ranges: Cost of Borrowing
Both College Ave and Sallie Mae present very similar starting APRs for their basic undergraduate student loans. However, Sallie Mae’s fixed and variable rate caps are marginally lower than College Ave’s. This subtle difference could make Sallie Mae a potentially more favorable option for borrowers or co-signers who might have less robust credit profiles, as the lower cap may translate to slightly more accessible rates for those with moderate credit.
Minimum Credit Score: Accessibility
Neither Sallie Mae nor College Ave publicly specifies a minimum credit score requirement for borrowers. This is partly because student borrowers can be as young as 16 years old and often have limited credit history. However, when it comes to co-signers, College Ave does have a stated minimum credit score requirement of 600. This is an important distinction for borrowers planning to use a co-signer, as College Ave’s explicit requirement provides clarity, whereas Sallie Mae’s criteria remain less transparent.
Repayment Terms and Flexibility
Understanding the repayment terms and flexibility offered by each lender is crucial for long-term financial planning. Here’s a breakdown of repayment options:
| Terms | Sallie Mae | College Ave |
|---|---|---|
| Private Student Loans | 10 or 15 years for undergraduate | 5, 8, 10, or 15 years for undergrad, grad, MBA, and career programs; 5 to 15 years for parent loans |
| Graduate Loans | 15 years for MBA, law, health professionals, general graduate studies; 20 years for medical and dental | 5, 8, 10, 15, or 20 years for dental, law, and medical school |
| Refinance Loans | Not offered | 5-20 years |
| Repayment Options | ||
| In-School Interest and Principal Payments | Not offered | Yes |
| Interest-Only Payments | Yes | Yes |
| Fixed In-School Payments | Yes, $25 per month while in school and during grace period | Yes, $25 per month while in school |
| Deferment | Yes, while enrolled at least half-time | Yes, while enrolled in school |
| Grace Period | 6 months for undergrad, grad, MBA, and health professionals; 9 months for law school; 12 months for dental school; 36 months for medical school | No grace period for parent loans; 6 months for undergrad and career programs; 9 months for graduate loans (except medical and dental); 12 months for dental school; 36 months for medical school |
For borrowers seeking rapid debt reduction, College Ave offers a shorter minimum loan term of five years, half of Sallie Mae’s ten-year minimum. However, both lenders allow prepayment without penalty, so early repayment is always an option with Sallie Mae loans as well.
While both lenders typically cap loan terms at 15 years for most degrees, Sallie Mae extends this to 20 years for medical or dental residencies. College Ave provides law students with a slightly longer repayment window of up to 20 years, compared to Sallie Mae’s 15-year maximum for law degrees.
A key difference is that College Ave offers the option to make full principal and interest payments while still in school, while Sallie Mae does not provide this option.
Loan Amounts and Limits
Both lenders offer loan amounts starting as low as $1,000 and extending up to the total cost of attendance (minus any other financial aid received) for most degree programs.
However, College Ave imposes a $150,000 loan cap on certain degree programs, including dental, law, medical, and business schools. This same $150,000 cap also applies to refinancing loans for non-graduate, professional, medical, dental, pharmacy, and veterinary doctorate degrees. If your program’s total cost exceeds this limit, Sallie Mae might be the only option between these two.
Fees: Additional Costs
Neither Sallie Mae nor College Ave charges loan origination fees, which is a significant advantage. Both lenders do impose late fees, set at 5 percent of the overdue amount, up to a maximum of $25. Sallie Mae also charges a $20 fee for returned checks, which is a point to consider to avoid unnecessary charges.
Bottom Line: Making the Right Choice
Ultimately, both Sallie Mae and College Ave are strong contenders in the student loan market, providing competitive rates and flexible terms to facilitate your educational financing needs.
Choose College Ave if: You are pursuing a graduate degree, especially in business, law, medicine, or dentistry and prefer the option to make in-school payments. College Ave’s specialization in graduate loans and flexible term options make it a robust choice for advanced studies.
Choose Sallie Mae if: You are a part-time student or require specialized loan products, or if you value potentially lower rate caps for borrowers with less-than-perfect credit. Sallie Mae’s broader range of loan products and part-time student focus can be advantageous in these scenarios.
Explore More Student Loan Lenders
If neither Sallie Mae nor College Ave fully aligns with your needs, it’s wise to explore additional student loan lenders to ensure you find the best fit. Consider these alternative lenders:
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Ascent Student Loans: Best for bootcamps and vocational programs.
Learn more about Ascent Student Loans ]
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SoFi Student Loans: Ideal for borrowers with good to excellent credit.
Discover SoFi Student Loan options ]
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Citizens Bank Student Loans: Known for competitive interest rates.
Explore Citizens Bank Student Loans ]
By thoroughly comparing Sallie Mae and College Ave, and considering alternative lenders, you can confidently select a student loan that supports your educational journey and financial well-being.
