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Guide to Loan Selection
We strongly encourage you to
carefully evaluate the terms offered by lenders, even if you are
taking out a FFELP loan where the interest rates are set by the
government. It is essential that you educate yourself about the
relative terms and benefits offered by lenders to ensure the best
possible terms for your personal circumstances. We encourage you to
compare the following lender services when deciding which lender to
select:
- Customer service is an extremely
important criterion that should be considered when selecting a
lender. Top notch service should include:
- A 24-hour toll-free number
where you can reach a qualified customer service representative
associate
- Lender or designated servicer
maintains loan for the life of loan (Please note that if a
lender sells a loan, they are required to notify the borrower)
- Self-servicing lenders or
maintaining the same third-party servicer for the life of the
loan repayment
- Online account access and
email access to account representatives
- Timeliness of problem
resolution and knowledgeable staff
- Low number of borrower
complaints
- Combined billing options all
loans owned by lender
- Provide an electronic online loan
application process and instant approval.
- Loan interest rates and special
benefits - These are very similar for the federal loan programs, but
many lenders offer discounts at origination and at repayment. Some
examples include:
- Auto Debit interest rate
reduction at repayment
- Interest rate reductions with
a certain number of on-time payments
- Principal reductions at
origination and/or at repayment
- Late payment forgiveness
- Lender pays the origination
fee
- Lender or guarantee agency
pays the federal default fee
- Ability to regain benefits if
you lose them, i.e., due to late payment
- Capitalize interest on your
loan once at the time student enters repayment or less
frequently (quarterly or annually)
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Copyright © 1999-2008 Eastern Virginia Medical School
Revised:
August 03, 2007
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