Editorial Note: We earn a commission on partner links on Forbes Advisor. Commissions do not modify the opinions or ratings in our editors.
Many institutions offer student loans, however, many offer more options or lend at better rates than the others. When searching on the internet banks and lenders for private student loans, remember about lending institutions.
Credit unions often offer very competitive rates to their members compared to other lenders. So you might have more, and often better, options by broadening your search. Here's how to find the best student credit union lenders.
How credit unions vary from banks
Banks and credit unions offer most of the same products, including checking and savings accounts, credit cards, loans and mortgages. However, they differ in certain important points.
Banks are for-profit companies that are generally private or publicly owned. Because banks need to make a profit, they are able to charge higher cost and higher interest rates than a bank, which is a non-profit organization. Banks will also be less strict about who they permit to spread out a merchant account, and many people are eligible to use a bank.
By contrast, lending institutions are owned by their members. And because people in lending institutions share ownership from the organization, there are often requirements to become listed on. You may need to work with a specific employer, reside in a certain area, or be part of another group, like a union, church, or school. If a family member qualifies, you may also meet the requirements.
And because lending institutions are not-for-profit, they are able to return the profits for their members. To do this, credit unions typically offer lower fees, lower rates of interest on loans, and higher rates on savings accounts. That's why obtaining a education loan from a credit union could be beneficial: you might find options that may beat those provided by traditional banks or online lenders.
Find Loans From Credit Unions Inside your Area
Since many lending institutions require that you simply meet certain membership criteria, it seems sensible to start your research in your neighborhood. A simple online search for “credit unions near me” will highlight local credit unions. You can also make use of the National Credit Union Administration's bank locator to find a complete list.
Much like banks and online lenders, you should review each credit union before committing to anything. Look for things like:
- Student loan products: Some lending institutions don't offer student education loans and may limit themselves to particular services and products.
- Membership conditions: Be certain that you're entitled to membership in every bank you review. Some may need you to definitely join and be a member of the credit union for time prior to applying for an education loan. Others may allow you to become a member and apply for a education loan simultaneously.
- Interest rate and fees: Examine and compare the eye rates between local credit unions to see which ones provide the lowest interest and fees.
- Loan Eligibility: See precisely what it takes to be eligible for a a student loan. For instance, you may need a minimum credit score or meet a particular income threshold to qualify. Since these are private student education loans, not federal government student education loans, your credit report is a major consideration.
Find nationally available credit unions
While lending institutions thrive in local neighborhoods, some are available across the country. Here are a few that you might want to consider for the student education loans.
1. Loan key
LendKey partners with lending institutions and community banks across the country and connects them with potential borrowers. You can use for a private student loan or perhaps a refinanced student loan, among other options. Students enrolled a minimum of part-time can use for a financial loan, and you may add a co-signer if you need help getting the lowest rates. Applicants may qualify to gain access to as much as the cost of attending their school.
2. PenFed Credit Union
Anyone is eligible to join PenFed Bank, which offers new student loans to undergraduate and graduate students, as well as scholarship opportunities. You can borrow up to your school's tuition fees, and refinancing choices are also available if you have graduated. Membership in PenFed also provides access to other savings opportunities, with discounts on things like auto insurance, tax services, and residential home security systems.
3. Federal Navy Credit Union
Navy Federal Bank offers new student loans or refinancing options. To become a member, you or a a family member must have served within the armed forces, such as the military, navy, air force, coast guard or national guard. You can use for membership simultaneously as you submit your loan application. Borrowers also have automatic accessibility Navy Federal Career Assistance Program, which supplies interview tips, a resume creation tool, along with other helpful tools.
What makes student loans different from credit unions?
While lending institutions typically offer similar products, lending institutions, banks, and lenders handle student loans a little differently. Here's what to anticipate from a student loan from a bank.
More attentive to the requirements of members
If you're struggling to qualify for a private education loan from the bank or online lender, you might find more opportunities and fewer stringent loan requirements at a bank. You may have no trouble qualifying for a student loan with a bank should you already fit in with a co-op located in your area.
If you take out financing from the national bank or perhaps an online lender, you typically have access to it whenever you want. In accessory for a mobile app and website, you can probably call or speak with someone via live chat without notice.
If you are taking out financing from the bank, you may have more limitations. Online services may be less robust and you'll need to visit a branch or call during business hours for assistance. Finally, there might be fewer locations when utilizing a bank. This means that if you are traveling or leaving the region, managing your loan may well be more complicated.
Since lending institutions are generally community-based, they often have a smaller subscriber base than domestic banks or lenders, so you get more personalized service. And since lending institutions are managed by their members, you can vote on certain business decisions, including the selection of their board members.
Of course, not all lending institutions are created equal. If you're unsure of a credit union's reputation, read reviews online or ask your network for private recommendations.
Compare education loan rates in minutes
Compare the rates of participating lenders through PayPasser.com