LendKey is a renowned online marketplace that connects borrowers with a vast network of lenders, consisting mostly of community banks and credit unions. The LendKey student loans and refinancing options, along with its home improvement product, are some of the best in the market.
Thanks to its cutting-edge digital platform, lenders are able to save with automation, allowing them to offer competitive interest rates.
With tuition fees at an all-time high, attending college has become a distant dream for many average US students. If you’re in the exact same boat, and wondering how to pay for college or how to pay off student loans, LendKey might just be the solution you need.
To guide and help you decide, this in-depth review will take you through the specifics of the LendKey student loans and refinancing options, such as interest rates, repayment terms, qualifying criteria, pros and cons, and even popular alternatives.
Let’s get started.
LendKey Private Student Loans
LendKey’s private student loans are offered at highly competitive interest rates. Unlike most other companies and marketplaces, there aren’t any fees for the application process.
The company works with different partners to provide private student loans, two of which are Sallie Mae and the WSFS Bank.
In addition, potential borrowers with good credit scores don’t necessarily have to apply for a loan with a co-signer. However, LendKey recommends doing so as it increases the chances of loan approvals.
LendKey Student Loans Details and Interest Rates
Here’s a quick walkthrough of the details to help you decide:
- Interest Rates: With AutoPay, the fixed APR is 5.36% and up , while variable APR is 4.40% and up. Lendkey has not provided a top limit for APR.
- Loan Terms: Borrowers can select from loan terms of 5, 10, or 15 years.
- Loan Amounts: While the loan amounts vary from lender to lender (and states), the minimum amount is $1,000. From here, it can even go up to the total cost of attendance.
- Minimum Income Requirement: As of now, the minimum annual income requirement is only $24,000 per year, which is better than most.
- Minimum Credit Score Required: Borrowers must have a minimum credit score of 660 to be considered eligible for the loan.
- Residency Requirements: The potential borrower must be a US citizen or a permanent resident.
- Repayment Options: Your first option is to start interest-only payments while still in school (either interest-only or with flat $25 per month) for up to 60 months. The second option is to start payments either immediately or after a 6-month grace period following your graduation.
- Fees: There are no application or origination fees. However, there is a late fee ranging from $5 to $15, which applies after a delay of 15 days in payments.
- Penalties: There are no prepayment penalties, meaning that borrowers can easily start paying off loans before they graduate school.
To be considered eligible for the loan, you must be enrolled either full-time or at least half-time at any institution that’s eligible to receive financial aid.
If you’re considering bringing aboard a co-signer, do note that the average credit score is 768. Furthermore, LendKey allows for a co-signer release after 24 months.
LendKey Private Student Loans Review
If you’d rather prefer dealing with a credit union or a commercial bank, and not with a large financial institution, one of LendKey’s student loans might just be the perfect option for you.
That being said, let’s take a deeper view and see where these loans stand in terms of eligibility and loan repayment terms:
Qualifying for the Loan
The maximum debt-to-income ratio for borrowers is 33%, and that is without including the cost of housing. Besides the minimum credit score requirement of 660, there aren’t any strict stipulations. As long as you meet other requirements (credit history, minimum annual income, eligible school, etc.), you can send in your loan application without a co-signer.
Depending on how much you borrow, along with your immediate and long-term financial goals, LendKey offers good flexibility in terms of repayment. As discussed earlier, borrowers can pay off their loans in either 5, 10, or 15 years.
One of the best things about LendKey is that it not only allows you to make interest payments while you’re still in school, but also lets you pay off the amount on top of that so that your loan doesn’t tower up.
Once you finish school, you get a grace period of 6 months.
LendKey Student Loans’ Competitors
While LendKey has its plus-points – which we’ll get to later – there are certain competitors that give it a run for its money.
Here are the details:
Citizens One: With a minimum fixed APR of 4.40% and variable APR of 2.6%, Citizens One is a primary competitor of LendKey. This is the best option available for international students, as they can easily apply for a loan (all they need is a co-signer). The loan amounts vary from $1,000 to $100,000, whereas the repayment terms are the same as LendKey’s (5, 10, and 15 years).
SoFi: A great option for those looking to get debt-free quickly, SoFi offers the freedom to make bi-weekly payments. The fixed APR is 4.73%, whereas the variable APR is 3.11%. Loan amounts vary from $5,000 to the total cost of attendance.
LendKey Student Loan Refinancing
One of LendKey’s primary products is student loan refinancinge. With the help of its network of credit unions and banks, lenders can easily refinance both private and federal loans.
To start refinancing student loans, first and foremost, you must have graduated from a Title IV eligible school (i.e. an institution that’s eligible for federal aid).
LendKey Student Loan Refinancing Details and Interest Rates
Here’s a breakdown of the student loan refinancing through LendKey:
- APR Rates: The fixed APR is 3.39%, whereas the variable APR is 1.90%
- Loan Terms: The terms range from 5 to 20 years.
- Loan Amounts: For undergraduate degrees, the amount varies from $5,000 to $125,000, whereas for graduate degrees, it goes up to $250,000. For dental, medical, and veterinary programs, the limit is $300,000.
- Loan Types: Both private and federal student loans count.
- Minimum Income Requirement: The minimum income requirement without a co-signer is $24,000 per year. However, a borrower applying with a co-signer can have an annual income as low as $12,000.
- Minimum Credit Score Required: The minimum credit score is the same as for private student loans, i.e. 660.
- Residency Requirements: Should either be a US resident or a permanent resident.
- Loan Transfer/Death Discharge: All lenders offer automatic discharge upon death or disability.
- Fees: There are no origination or application fees. Late fees may apply, which range from $5 to $15.
- Penalties: There are no prepayment penalties.
LendKey allows for co-signer release after 12 months of timely payments – a 50% reduction in duration when compared to LendKey student loans.
LendKey Student Loan Refinancing Review
Competitive rates, coupled with a vast network of lenders, make LendKey a promising option for many.
Let’s dive into how you can qualify and what repayment terms to expect:
Qualifying for Refinance
Apart from the minimum credit score, annual income, and type of school (already discussed), the maximum debt-to-income ratio is 50%. Additionally, if you’re from West Virginia, North Dakota, Maine, Nevada, or Rhode Island, you can’t get any loans.
As already mentioned, the repayment terms vary from 5 to 20 years.
LendKey Student Loan Refinancing Competitors
Here are some LendKey competitors that give the company a run for its money:
ELFI: The Education Loan Finance (ELFI) offers great flexibility, with loan terms of 5, 7, 10, 15, and 20 years. The fixed APR starts from 2.89%, whereas the minimum variable APR is 2.39%. In terms of customer support, ELFI is one of the top names.
Splash Financial: An online marketplace, similar to LendKey, Splash Financial provides access to different lenders. The minimum fixed APR is 3.48%, whereas the variable APR is as low as 2.27%. The repayment plans typically range from 5 to 20 years, however, there is a 25-year term for those opting for variable rate loans.
Pros and Cons of LendKey
LendKey, like all other companies and marketplaces, has its plus-points and shortcomings. Let’s have a look at both to help you decide:
Pros of LendKey
Here are some compelling reasons why you’d want to go for LendKey:
- Lower Interest Rates: Since LendKey handles all processes through its digital platform, LendKey’s partners offer loans at low rates.
- In-School Payments: Borrowers can start paying off their loans while still in school.
- No Co-signer Necessary: Unlike some other marketplaces, you don’t need a co-signer to apply for loans.
- Long Forbearance: LendKey offers an 18-month forbearance period – one of the longest in the market.
- Great Customer Service: LendKey scores an “A+” on Better Business Bureau, which speaks volumes for its customer service.
These reasons alone should be enough for most borrowers.
Cons of LendKey
Before you make a decision, have a look at these drawbacks of opting for LendKey:
- Limited States: LendKey student loan refinancing isn’t available in all US states.
- No Postponement: There is no military deferment for either LendKey student loans or refinancing options.
If you’re planning on serving in the military, it’s best if you don’t opt for LendKey.
Should You Go for LendKey Student Loans and Refinancing?
Whether you’re opting for private student loans or want to go for student loan refinancing, LendKey is a promising option.
While the marketplace has its shortcomings, it’s still one of the top names out there. Again, if you’re not willing to deal with a major financial institution, and would rather work with a commercial bank or a credit union, you should go for LendKey.
Remember: You can always come back to FutureFuel to learn more about student loan refinancing.