We rate Earnest as the best student loan company because it is transparent about loan types, terms, and the application process. Earnest also offers discounts, charges no fees, and provides in-house customer support.
If you need to borrow money for school, it is best to use federal aid first. However, if you still have gaps to fill, private student loans can be a viable option. We’ll explain our top choices for private student loan companies and help you decide if taking out a student loan is worth it or not.
| Company | Our Reward | Our Rating |
|---|---|---|
| Earnest | Best Overall | 4.8 |
| College Ave | Best Multi-Year Loans | 4.6 |
| ELFI | Best Customer Service | 4.5 |
| Sofi | Best Competitive Rates | 4.4 |
| Ascent Funding | Best Flexible Terms | 4.3 |
Note: research is based on undergraduate student loans.
Earnest offers a broad range of repayment terms, loan types, and borrowing amounts to fit many students’ needs.
| Pros | Cons |
|---|---|
| 5 repayment terms available | You’ll need a co-signer to get a lower interest rate |
| Will match competitor rates | Not available to borrowers residing in Nevada |
| In-house customer support | No co-signer release |
Earnest stands out for its comprehensive loan options and exceptional customer service. While some student loan companies may not provide telephone or online assistance, Earnest has an in-house “Client Happiness Team” to assist borrowers in the loan process.
Here’s a look at how Earnest ranked for each of the categories we researched:
| Research Category | Earnest Rating |
|---|---|
| Loan Terms | 4.3 |
| Application Process | 4.8 |
| Reputation | 5.0 |
| Customer Service | 5.0 |
Earnest shares its loan terms clearly on its website, making it transparent for borrowers to identify loan options and minimum requirements.
Understanding eligibility criteria is a critical part in securing a student loan, yet not every servicer makes its requirements readily available. Earnest, however, is forthright with eligibility requirements, is transparent about no hidden fees, and offers discount perks.
We consider BBB ratings along with customer reviews from Trustpilot to rank student loan providers. Earnest holds an A+ rating on BBB, is BBB accredited, and has been servicing student loans since 2013.
Earnest has more than 900 reviews on Trustpilot with an average review of 4.7 stars out of 5.
Earnest stands out among competitors because of its straightforward approach to handling customer problems. A designated group – aptly named the “Client Happiness Team” – is available to assist borrowers with problem solving, loan questions, and navigating the application process. The customer support telephone number and hours of operation are displayed prominently on its website.
College Ave wins our Best Multi-Year Loans category due to its flexibility for borrowers to acquire a loan each year of school attendance. College Ave notes that 90 percent of their undergraduate borrowers that apply with a co-signer are approved for additional loans.
| Pros | Cons |
|---|---|
| 3-minute application | Shorter grace period |
| Co-signer release | Will likely need a co-signer |
| Choice of repayment terms |
College Ave offers multiple repayment options, has a strong reputation and history of servicing student loans for more than a decade, and borrower reviews note positive experiences with the application process and customer service.
Here’s a look at how College Ave ranked for each of the categories we researched:
| Research Category | Earnest Rating |
|---|---|
| Loan Terms | 4.4 |
| Application Process | 4.5 |
| Reputation | 5.0 |
| Customer Service | 4.5 |
College Ave discloses most of its loan terms on its website and encourages borrowers to apply with a co-signer for optimal interest rates.
While College Ave does not disclose minimum income requirements, it does make it clear there are no fees and a desirable credit score should land somewhere in the mid 600s. Plan to have a co-signer to receive the lowest interest rate.
College Ave has a solid reputation, having started servicing student loans in 2014. It is BBB accredited with a BBB score of A+. With nearly 2,000 Trustpilot reviews and a rating of 4.5, borrowers note the ease of application process and quick responses from customer support.
Borrowers can expect to reach College Ave customer support through email, online chat, and text message. There is also an online Frequently Asked Questions resource to guide borrowers in answering their questions before reaching out to customer support.
ELFI makes the private student loan process seamless by pairing every applicant with a Student Loan Advisor, which is why we ranked ELFI as the Best Customer Support company.
| Pros | Cons |
|---|---|
| Personalized customer service | No co-signer release |
| Competitive interest rates | Subject to late payment fees |
| Flexible repayment options | No autopay discount |
Through each phase of the student loan process, ELFI Student Loan Advisors guide applicants via phone, text, and email. Customer reviews commonly site the helpfulness of being paired one-on-one with an advisor to make the loan process simple and smooth.
Here’s a look at how ELFI ranked for each of the categories we researched:
| Research Category | Earnest Rating |
|---|---|
| Loan Terms | 4.3 |
| Application Process | 4.4 |
| Reputation | 4.6 |
| Customer Service | 5.0 |
While ELFI offers competitive fixed and variable interest rates, it does not allow co-signers to be released. You would have to refinance your loan to remove your co-signer’s name and alleviate their responsibility.
There are no autopay discounts with ELFI and expect to pay a late fee if your payments don’t arrive on time. You’ll also need a strong credit score to apply; if you don’t yet have a credit history or your score is below the minimum threshold, you can apply with a co-signer.
Founded in 2015 as Education Loan Finance through a subsidiary of SouthEast Bank, the company is commonly known at ELFI.
ELFI is not BBB accredited, but it does hold an A+ BBB rating. Trustpilot reviews are favorable, earning 4.8 stars with numerous anecdotes on the effectiveness of having personalized customer service through one-on-one advisors, making the loan process fluid and informative.
While ELFI has some shortcomings on loan terms – like late fees and no co-signer release – applicants can be assured they will have plenty of assistance from the beginning application all the way through to loan pay off.
Student Loan Advisors are paired with each applicant to provide customized support, answer questions, help complete application materials, and provide detailed information on what to expect with a student loan.
Interest rate: 3.54-15.99% Fixed, 4.64-15.99% Variable
SoFi takes the lead for Best Competitive Rates as it offers a span of fixed and variable ranges alongside varying repayment options. Other perks like a cash bonus, no fees, and co-signer release make SoFi a strong contender for private student loans.
| Pros | Cons |
|---|---|
| Fair interest rates | Does not disclose minimum credit score or income requirements |
| Co-signer release | Shorter grace period |
| $250 cash bonus for good grades | Not BBB accredited |
SoFi has a competitive range of interest rates for fixed and variable loan terms. Like other student loans, the better your credit score the more likely you are to obtain an interest rate in the lower range.
Here’s a look at how SoFi ranked for each of the categories we researched:
| Research Category | Earnest Rating |
|---|---|
| Loan Terms | 4.2 |
| Application Process | 4.3 |
| Reputation | 4.5 |
| Customer Service | 4.5 |
You can choose from four different loan repayment terms with SoFi and release a co-signer after 24 consistent on-time payments. SoFi also provides multiple loan types beyond undergraduate options, such as law, MBA, and health professions.
SoFi will never charge you origination fees, late fees, or insufficient funds fees. However, it does not disclose minimum credit score and income requirements, beyond suggesting you need sufficient income to obtain a loan.
If you are a parent borrower with more than one child, SoFi is one of the few companies that offers added discounts for multiple loans through the Family Discount program.
In business for more than a decade, SoFi launched in 2011 and was the first company to offer refinancing on federal and private student loans. It’s BBB rating is A+ but it is not BBB accredited.
As a multifaceted company, it offers many types of loans beyond student loans, including mortgages and personal loans. Trustpilot ranks SoFi 4.4 stars with 9,000 reviews. Customer reviews denote mixed interpretations of SoFi’s student loans, some finding the refinance process helpful and others unable to get clarity on income requirements during periods of hardship.
Ascent Funding ranks in our top 5 for its flexible repayment options, extended forbearance of 24 months, nine-month long grace period, and the option for co-signer release.
| Pros | Cons |
|---|---|
| Variety of repayment options | Does not disclose minimum credit score or income requirements |
| Longer than average forbearance | Need co-signer for best rates |
| Boot camp loans available | Borrowing limit |
Ascent Funding scored 4.0 or higher in each category we reviewed other than reputation. Due to a lower than average BBB rating of B, Ascent Funding fell to 3.9 in the reputation category. However, it’s flexible loan terms, robust forbearance, and shorter than typical co-signer release makes Ascent Funding a top 5 company to consider.
Here’s a look at how Ascent Funding ranked for each of the categories we researched:
| Research Category | Earnest Rating |
|---|---|
| Loan Terms | 4.8 |
| Application Process | 4.0 |
| Reputation | 3.9 |
| Customer Service | 4.5 |
Ascent Funding offers flexible repayment terms from 5 to 20 years. It is important to note that applicants that select the 20-year repayment term will only receive a variable interest rate. If you seek a fixed interest rate, opt for a shorter repayment term.
You will need an income of at least $30,000 to get loan approval. While Ascent Funding does not disclose a minimum credit score, the company recommends using its pre-qualification tool to check rates and find the best product for your needs.
Out of the 20 student loan companies we reviewed, Ascent Funding ranked the lowest on BBB with a rating of B. While it is BBB accredited, 18 consumer complaints have been filed. Ascent Funding also scored lower than other competitors on Trustpilot, with a 3.3-star rating.
Despite its seemingly lower reputation rank than other private student loan companies, Ascent Funding’s diverse repayment plans, coupled with longer forbearance and shorter co-signer release, make it a student loan company worth considering.
A detailed Frequently Asked Questions database makes it easy to find quick answers to common questions about the application process, loan terms, and repayment considerations. For more in-depth inquiries, borrowers can reach customer service via telephone and email assistance.
| Research Category | Earnest Rating |
|---|---|
| Loan Terms | 3.7 |
| Application Process | 3.0 |
| Reputation | 5.0 |
| Customer Service | 4.5 |
| Loan Details | Sallie Mae |
|---|---|
| Types |
Undergraduate, graduate, career, health professions
|
| Amounts |
$1,000 up to the cost of attendance
|
| Terms | 10 to 15 years |
| Interest Rates |
3.49-15.49% Fixed, 4.54-14.71% Variable
|
| Forbearance | 12 months |
| Co-signer Release | Yes |
| Minimum Credit Score | Does not disclose |
| Minimum Income | Does not disclose |
| Fees | No |
| Discounts | 0.25% autopay |
| Grace Period | 6 Months |
| Year Founded | 2005 |
| BBB Accredited | Yes |
| BBB Rating | A+ |
| Customer Support | Yes |
Private student loans originate from nonfederal lenders such as banks, credit unions, and state agencies, among others. The primary difference between federal student loans and private is that federal loans are made by the federal government. This means the government sets the terms and conditions of federal student loans while private lenders have jurisdiction over their loan terms.
It is best to use federal loan options first as they are often less expensive than private student loans. To obtain federal student loans, you will need to complete the Free Application for Federal Student Aid, or FAFSA at studentaid.gov. By completing the FAFSA, you will also become eligible to receive federal grants and scholarships, as well as work-study programs.
See the table below for specific differences between federal and private student loans.
| Private Student Loans | Federal Student loans |
|---|---|
| Variable or fixed interest rate | Fixed interest rate |
| Typically credit check is required | No credit check unless applying for a parent loan |
| Payments usually required while in school, but some lenders may allow you to defer | Payments due after graduation |
| Generally, no interest subsidies | Interest subsidies available (other than for parent loans) |
| Cannot consolidate loans but can refinance | Consolidation available |
| Postponement options vary by lender | Temporary postponement available if you are having a hard time making payments |
| Repayment plans vary by lender | Multiple repayment plans, included fixed payment and income-driven repayment plans |
| Prepayment penalties vary by lender | No prepayment penalties |
| Usually no loan forgiveness available | Loan forgiveness available for public service |
There are many different types of private student loans depending on your situation. You will need to assess what type of degree you are pursuing and your unique situation in order to select the best loan type. Here are some common loan types:
Not all student loans are equal. Some student loan companies may have one or two repayment options, while others may offer numerous choices for how and when to repay the borrowed funds. As you determine the best student loan option for you, research the following criteria from multiple lenders to compare and contrast what is available:
For many student loans, you will be able to borrow up to the cost of attendance. Cost of attendance is provided to you from your school and represents the total amount it will cost you to go to school for one year before financial aid.
Cost of attendance typically estimates the following categories:
If you attend a two-year or four-year college, you may receive cost of attendance for the full school year, showing the fall and spring semesters. For career-training programs that may not operate under a standard semester system, such as an 18-month program, cost of attendance may include that specific time period rather than an academic year.
It is important to understand cost of attendance not only because you may be able to borrow up to that amount with a student loan, but to also calculate your total education costs. It may be helpful to use the U.S. Department of Education’s comparison tool College Scorecard to assess the true cost of college across multiple institutions you are considering. You will need a concrete understanding of how much your education will cost before you can determine how much money you may need to borrow.
| Company | Our Rating |
|---|---|
| Earnest | 4.8 |
| College Ave | 4.6 |
| ELFI | 4.5 |
| Sofi | 4.4 |
| Ascent Funding | 4.3 |
| InvestED | 4.1 |
| Citizens | 4.1 |
| LendKey Technologies | 4.1 |
| FundingU | 4.1 |
| Abe | 4.1 |
| Sallie Mae | 4 |
| MPower Financing | 4 |
| Brazos Higher Education | 4 |
| PNC | 3.9 |
| MEFA | 3.9 |
| Nelnet Bank | 3.8 |
| EdvestinU | 3 |
| RISLA | 2.8 |
| Custom Choice | 2.8 |
| Edly | 2.7 |
How much you borrow in student loans will depend on whether you are seeking a federal or private student loan. For example, federal student loans have borrowing limits, which include the following annual amounts for independent students:
Federal student loans also have aggregate loan limits that represent the maximum amount of funds you can receive over the course of your studies:
While federal student loans have strict parameters for borrowing amounts, private student loans vary based on lender. However, most private lenders commonly fund up to the cost of attendance and many have minimum borrowing requirements of $1,000.
Just because you are offered a maximum student loan amount, you are not obligated to take it all.
In fact, the Consumer Financial Protection Bureau recommends only borrowing the amount you need to pay for your education and to limit loans to what your future earnings will likely be able to repay.
If you’re reading this, then the chances are good that you are investigating whether or not a private student loan makes sense for you.
As a general rule, the U.S. Department of Education recommends using federal student aid first before exploring private student loans. This is because private student loans will often cost you more than federal options and you won’t have access to federal relief and student loan forgiveness programs.
Max out your federal aid first — starting with grants, scholarships, and federal loans— and then turn to private student loan lenders to fill any funding gaps you may need to successfully complete your education.
When deciding which student loan company to borrow funds from, research and compare terms like fixed versus variable interest, forbearance, deferment, co-signer release, grace period, discounts, and fees.
Fixed interest means that your rate will stay the same throughout the course of your loan. If you agree to borrow funds at 5.3%, for instance, your interest rate will always be 5.3% until you pay the loan off in full.
In contrast, variable interest will vary based on market conditions. Let’s say you borrow money from a private lender with a variable interest rate range of 4.64 to 15.99%. During your student loan repayment term, your interest rate can fluctuate to any number between the minimum and maximum percentages. This can potentially be a significant issue if you plan and budget for the lower end but your interest rate climbs to the top of the threshold.
Make sure you understand the type of interest you are signing up for and compare interest rates across multiple lenders before deciding to borrow.
As you research lenders, inspect their policies on forbearance and deferment. Both provide temporary payment pauses based on certain situations. For example, our top overall pick Earnest cites common reasons forbearance can be approved:
During periods of forbearance, interest typically continues to accrue and will be added to your principal. If you qualify for deferment, you can expect a similar pause in student loan payments but interest typically does not accrue.
If you asked a family member or friend to co-sign with you on a student loan in order to get a better interest rate, you may want to release that person from your loan in the future. This is known as co-signer release and some private lenders offer it after you have successfully demonstrated consistent repayment.
By removing a co-signer from your loan, you become solely responsible for the principal that remains. While it helps to research this offering before committing to a loan, servicers that don’t offer it still have options to remove a co-signer—the most notable being refinancing. When you refinance a student loan, you can put the new loan exclusively in your name. You may even get a lower interest rate during the refinancing process if market rates are favorable.
A grace period denotes the time you have after finishing school to start repaying your loan. Most private student loans offer grace periods of 6 or 9 months, but there are some lenders that may offer up to 12 months. That’s a whole year post-graduation before having to make your first payment.
Grace periods may also kick in if you drop below your lender’s enrollment requirement. If your loan stipulates that you must attend full-time and you drop to half-time or pause your studies completely, your grace period may begin earlier than graduation.
Like any other business, student loan companies offer incentives to acquire your business. Most commonly this equates to an autopay discount of 0.25% but some lenders sweeten the deal with extra perks. Here are some standout examples of bonus offerings from private student loan lenders:
Our best overall pick for student loans is Earnest. You’ll get superior customer service, a range of repayment terms to choose from, and transparency on eligibility criteria.
When selecting a student loan company, be sure to read the fine print carefully and compare multiple lenders on specific criteria like repayment terms, interest rates, fees, discounts, and enrollment requirements. If the information you need is not readily available on a lender’s website, proceed with caution.
The type of interest rate you get is a personal choice. However, fixed rate will be easier to budget into the future because it never changes. If you opt for variable, assume that an increase in interest rate may occur and plan for it in advance.
How much you borrow in student loans will vary depending on the type and terms of the loan. If you borrow from the federal government, you will have an aggregate loan limit of $57,500 for undergraduate and $138,500 for graduate studies. Private student loans vary based on lender but most fund student loans with a minimum of $1,000 and up to the total cost of attendance. Check your private student loan lender’s criteria to identify the minimum and maximum amounts available.
FAFSA stands for Free Application for Student Aid and is the primary form you complete through the U.S. Department of Education if you are seeking federal student aid. It is recommended to utilize federal student loans first before seeking private lenders as federal loans can often cost less over the life of the loan and you may be eligible for income-driven repayment programs.
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