Is Discover Student Loan a Good Choice for Borrowers

Discover Student Loan can be a good choice for borrowers, but it's essential to weigh the pros and cons. One of the benefits is that Discover Student Loan offers a 1% cashback reward on purchases made with the Discover it Chrome credit card, which can help borrowers pay off their loans faster.

The loan's fixed interest rate is also a plus, as it provides predictability and stability in monthly payments. With a fixed interest rate, borrowers can budget more effectively and avoid surprises.

Discover Student Loan offers a range of repayment terms, from 5 to 15 years, giving borrowers flexibility in choosing a repayment plan that suits their financial situation. This flexibility can be particularly helpful for borrowers who may need more time to pay off their loans.

Discover Student Loan has a relatively low minimum payment requirement, which can be beneficial for borrowers who are struggling to make ends meet.

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Discover offers a range of student loan options, including undergraduate, graduate, medical school, law school, and healthcare profession residencies loans. You can borrow up to the total cost of attendance, with loan amounts starting at $1,000.

Discover also offers student credit cards and student loan refinancing options. With most of Discover's loans, you can select one of three payment plans: Deferred, Interest-only, or Flat Monthly. However, parent student loans are on immediate payment plans, requiring full monthly payments immediately after the final loan disbursement.

Discover's loan terms vary by type, but most have 15-20 year repayment periods. Some loan options, like medical school loans, have a slightly shorter repayment period of 20 years. You can also qualify for interest rate discounts by enrolling in autopay or opting for interest-only repayment.

Here are some key features of Discover's student loans:

Discover offers a range of student loan options to help make education more affordable. They provide loans for undergraduates, graduate school, medical school, law school, healthcare profession residencies, bar exam study, and parent student loans.

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With Discover, you can borrow up to the total cost of attendance for your education. The loan amounts range from $1,000 to the total cost of attendance, depending on the type of loan.

Discover offers variable and fixed interest rates on their loans. The rates vary by loan category, but you can expect to pay between 4.49% to 16.62% APR for variable rates and 4.99% to 14.99% APR for fixed rates.

You can choose from three payment plans: Deferred, Interest-only, and Flat Monthly. However, parent student loans are not eligible for these payment options and are on an immediate payment plan.

Discover also offers student loan refinancing options, which can help you save money on interest. However, they currently do not accept new student loan refinancing applications.

Here's a comparison of Discover's loan terms with College Ave:

It's worth noting that Discover's loan refinancing options have a cosigner release provision, but only after the borrower has paid off half the loan and met certain requirements.

Discover uses a hard credit check to evaluate creditworthiness, considering a range of factors including assets, income, debt, and credit score. A credit score of 680 or higher is generally considered acceptable for approval.

The credit score is just one piece of the puzzle, however, and isn't the sole criterion for making a loan decision. Student loans have additional factors at play, such as the borrower's expected income based on their degree.

Discover takes into account the co-signer's creditworthiness, income, and debt-to-asset balance when a co-signer is involved, and won't permit the student borrower to take over the loan except in cases of refinancing.

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Discover student loans have received mixed reviews from actual customers. College Ave has better ratings from customers, with a 4.4 out of 5 rating on Trustpilot and a 3.15 out of 5 rating on the Better Business Bureau.

Discover, on the other hand, has a 1.8 out of 5 rating on Trustpilot and a 1.18 out of 5 rating on the Better Business Bureau. This is likely due to the fact that Discover offers a wide range of financial products beyond just student loans.

Here's a comparison of the customer ratings for College Ave and Discover:

Discover is regularly a top pick in student loan rankings. It was selected by Forbes Advisor as the “best no-fee lender” in 2023.

Discover has received recognition for its excellent student loan offerings.

Forbes Advisor's endorsement is a notable seal of approval, suggesting that Discover's no-fee lender status is genuinely beneficial to customers.

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Discover has a poor reputation based on customer reviews, with a 1.8 out of 5 rating on Trustpilot and a 1.0 out of 5 rating on Google.

College Ave, on the other hand, has a much better reputation, with a 4.4 out of 5 rating on Trustpilot and a 3.1 out of 5 rating on Google.

The Better Business Bureau also reflects this trend, with College Ave having a 3.15 out of 5 rating and Discover having a 1.18 out of 5 rating.

Here's a comparison of the customer ratings for College Ave and Discover:

It's worth noting that Discover has a lot more customer complaints, with over 1,100 complaints filed with the Better Business Bureau in 2023, mostly about its banking services.

To qualify for a Discover student loan, you'll need to meet some basic requirements. You must be at least 16 years old at the time of loan application, and if you're under 18, a cosigner is required.

To be eligible, you'll also need to be a US Citizen, permanent resident, or international student. International students, however, will need a creditworthy cosigner who is a US Citizen or permanent resident.

You'll also need to pass a credit check to qualify for the loan. Additionally, you must be enrolled at least half-time and making satisfactory academic progress in a Bachelor's or Associate's degree program at an eligible school.

Here are the key eligibility requirements summarized:

Deferment is a great option for borrowers who need to temporarily pause their payments. It's available for four types of deferments, including in-school deferments for students enrolled half-time or more in an eligible school.

The deferment period can cover school terms and breaks between terms up to six months. Borrowers can also qualify for active military duty deferments, public service deferments, and residency deferments for health care residency programs.

Here are the different types of deferments available:

Borrowers don't have to worry about penalties or an impact on their credit score. However, it's essential to remember that deferment can add a substantial amount of interest over four years, especially for undergraduate students.

To qualify for a student loan, you'll need to meet some basic requirements. You must be at least 16 years old at the time of loan application, and if you're under 18, you'll need a cosigner.

To be eligible, you must also be a US Citizen, permanent resident, or international student, and you'll need a creditworthy cosigner who is a US Citizen or permanent resident if you're an international student.

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You'll also need to pass a credit check, which is a standard requirement for most loans.

To qualify for refinancing, you must have graduated from college. If you didn't get a degree, you can still refinance with Discover, but you'll need to have taken out the loans while at least a part-time student.

To refinance with Discover, the minimum term length is 10 years, which can restart the clock on repayment if you've already been making progress on your current loans.

Here are the key eligibility requirements at a glance:

To apply for a Discover loan, you'll need to complete the full application and pass a hard credit check, which means you won't have the option for a soft credit check.

The application can be submitted online or over the phone by calling 1-800-STUDENT.

You'll be asked to provide your social security number and other personal information, as well as school and loan details if you're a student applying.

Loan processing can take 30 to 45 days after you've submitted your application.

Discover student loan refinance requires good credit and income to qualify on your own. You can still add a cosigner if you like, but they'd only help you qualify for better rates, not approval.

College Ave, on the other hand, has looser requirements and allows borrowers to qualify with a cosigner. This makes it more accessible for those who may not meet Discover's stricter qualifications.

Here's a comparison of the two lenders' eligibility criteria:

Refinancing can be a great way to save money on your student loans, but it's essential to understand the differences between various lenders. Discover and College Ave are two popular options, but they have distinct eligibility criteria.

Discover requires you to qualify on your own without a cosigner, but you can add one if you like, which would only help with better rates, not approval. College Ave, on the other hand, has looser requirements and allows you to apply with a cosigner.

The table below compares the eligibility criteria for Discover and College Ave:

College Ave is generally more accessible, allowing you to qualify with a cosigner, which can improve your chances of loan approval and provide a lower interest rate.

If you're looking for more repayment options, College Ave stands out for offering flexible terms. You can choose from five to 15 years, which is more than Discover's 15-year term.

One of the benefits of College Ave is that shorter terms tend to have lower interest rates, making it a more attractive option for borrowers who want to pay off their loans quickly.

Discover, on the other hand, offers 10- and 20-year repayment plans, which can be beneficial for borrowers who need more time to pay off their loans.

College Ave offers four different repayment options, giving borrowers more flexibility in choosing a plan that suits their needs.

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Here's a comparison of the repayment options offered by College Ave and Discover:

Keep in mind that interest rates for Discover vary depending on the borrower's creditworthiness, and can range from 1.00 percent APR to 5.74 percent APR for variable rates.

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Discover Student Loan has its perks, and here are some of the benefits that caught my attention:

No fees is a big deal, especially for students who are already juggling a lot of expenses. There are no application, origination, or late fees.

The auto debit reward is a nice touch, offering a 0.25% interest rate reduction when you're enrolled in automatic payments. This can add up over time and make a big difference in your overall loan costs.

If you need some extra time to pay back your loan, you can take advantage of deferment options that are available. This can be a lifesaver if you're facing unexpected expenses or financial setbacks.

Discover student loans have some limitations that you should be aware of. One of the main cons is that you're only given three repayment options: 10 years, 15 years, or 20 years.

The repayment period you're offered is also based on your creditworthiness, which might not be ideal for everyone.

If you're considering a loan from Discover, you should know that you'll need to fill out the full application and undergo a hard credit check before seeing your rate.

This means you won't be able to check your rates without potentially damaging your credit.

Here are some of the other cons to consider:

When borrowing money for school, it's essential to consider the pros of a loan. One of the most significant advantages is that you won't have to pay any fees, including application, origination, or late fees.

You can also get a 0.25% interest rate reduction by enrolling in automatic payments, which can save you money over time.

Students can take advantage of deferment options, which can give you some breathing room if you're struggling to make payments.

Here are the key benefits of choosing the right student loan:

Discover services its own loans, which means you can reach out to them directly if you're having trouble affording payments or have questions about your account.

This level of direct service is a notable advantage over other companies that rely on third-party loan servicers.

Discover has an A+ rating from the Better Business Bureau, but its customer satisfaction ratings are mixed, with a 1.7 out of five TrustScore on TrustPilot based on over 220 reviews.

Discover prioritizes user experience by taking a hands-on approach to loan servicing. This means that if you're having trouble affording your payments or have questions about your account, you can reach out directly to Discover.

Discover services its own loans, allowing for more personalized and efficient support.

Discover has a relatively poor reputation when it comes to customer complaints, with over 1,100 customers filing complaints against the company with the Better Business Bureau in 2023.

These complaints are mostly about Discover's banking services, not its student loans. It's worth noting that Discover is a well-known bank and credit card provider, so these ratings measure customer satisfaction across all of its products.

College Ave, on the other hand, has a much lower number of complaints, with only seven filed with the Better Business Bureau during the same time period.

Here's a comparison of the number of complaints filed against Discover and College Ave:

The complaints against College Ave cite various issues, including cosigners, identity theft, and interest rate discounts.

Discover is a great option for international students who need a student loan. This is because they only require a cosigner who is a U.S. citizen or permanent resident, making it easier for international students to qualify.

For another approach, see: Discover Credit Card for International Students

College Ave, on the other hand, requires international students to have a Social Security number to be eligible for a student loan. This can be a major barrier for international students who don't have a Social Security number.

If you're an international student looking for a student loan, Discover is the way to go. They offer more accessible options for international students.

Here's a comparison of the two lenders' eligibility criteria for international students:

This makes Discover a much better option for international students who often aren't U.S. citizens or permanent residents.

Discover's application process is surprisingly straightforward, taking less than 15 minutes to complete.

To qualify for a Discover private student loan, you'll need to provide some basic information, including your Social Security number, school information, and financial details.

Discover offers a variety of student loans, including options for undergraduates, graduates, and even bar exam prep for law school graduates.

Here are the key details you'll need to provide to apply:

Discover also offers some unique perks, such as in-school payment flexibility, good grade rewards, and graduation rewards.

Discover Student Loans have their own set of editorial ethics, which is a crucial aspect to consider when evaluating their services.

They have an advertising disclosure section that clearly mentions their partnerships with financial institutions, such as Discover offering student loan refinancing and private student loans for students who are still in school.

Discover student loans come with in-school payment flexibility, but post-graduation repayment terms are limited.

As of February 1, 2024, Discover is no longer accepting new student loan applications. You can still refinance your Discover student loans, but new loans aren't available.

It's worth noting that Discover offers refinancing and private student loans for undergraduates and graduates, as well as exclusive student loans for specific fields like MBA, health professions, law, residency, and bar exam students.

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Interest rates can make a big difference in the cost of your student loan. College Ave offers lower interest rates than Discover, with a 3.87% fixed APR compared to Discover's 5.24% APR for a $40,000 loan over 15 years.

This means that if you borrow $40,000 from Discover, you'll pay $17,841 in interest over the life of the loan, but if you borrow from College Ave, you'll pay $14,822 - a savings of more than $3,000.

If you're looking for a variable-rate loan, College Ave also offers lower starting interest rates, at 6.99% APR compared to Discover's 7.49% APR. This can add up to a difference of more than $1,500 in total interest paid over the life of the loan.

Discover, on the other hand, stands out for its flexibility and personal service when it comes to repayment. They offer ten- and twenty-year repayment plans, and their interest rates reflect the borrower's creditworthiness. They also offer flexible payment arrangements, such as the option to pause payments or reduce the monthly amount, which can be a big help if you're struggling to make timely payments.

Here are some key interest rates and repayment options to consider:

Keep in mind that these are just a few examples, and you should always review the terms and conditions of any loan carefully before making a decision.

Repayment options can be a lifesaver for students and borrowers alike. College Ave offers repayment terms ranging from five to 15 years, which can be a great option for those who want more flexibility.

Discover stands out for its flexibility and personal service when it comes to repayment. Student loan repayments can be spread over 10- and 20-year plans, making it easier to manage payments.

Interest rates with Discover reflect the borrower's creditworthiness, and you can choose between fixed and variable rates. For example, variable rates range from 1.00 percent APR to 5.74 percent APR, while fixed rates range from 2.99 percent to 6.74 percent APR.

Borrowers who struggle with making timely payments can get help from Discover. You can pause payments or reduce the monthly amount, giving you financial space to recover and resume regular payments.

Discover also offers temporary interest rate reductions, which can lower your monthly payment amount. You can get a lower interest rate for up to 12 months, giving you some breathing room.

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Temporary payment reductions are also an option, and you can even set up interest-only payments for up to six months. However, this requires your loan to be less than 60 days in arrears, and payments must be at least $50 per month.

Some important notes to keep in mind: Discover doesn't charge origination fees, penalties, or late fees, but service companies that handle consolidated loans may have these fees. Always review your loan documents carefully to understand the terms.

Discover does accommodate bi-weekly payment schedules, which can help you pay off your loan faster. You can also use autopay to add extra funds to your loan, reducing your balance even quicker.

Here's a comparison of Discover's repayment options with College Ave:

If you want a variable-rate loan, consider College Ave, which offers lower starting interest rates compared to Discover. College Ave's 6.99% APR is a full 0.5% lower than Discover's 7.49% APR.

This difference may seem small, but it can add up over time. For a $50,000 loan with a 10-year term, you'd pay $19,634 in total interest with College Ave's rate, versus $21,190 with Discover's rate. That's a difference of more than $1,500.

Your monthly payment would also be lower with College Ave, at $580 compared to Discover's $593. Here's a comparison of the two lenders:

Keep in mind that these rates are variable, so your payment will change on a regular basis, and you could end up paying a lot more or a lot less over time.

If you want the lowest interest rate, College Ave is the way to go. They offer lower interest rates than Discover, with a 3.87% fixed APR compared to Discover's 5.24%.

This difference can be significant over the life of the loan. For example, borrowing $40,000 from Discover with a 5.24% fixed interest rate and a 15-year term will result in a total interest of $17,841.

On the other hand, borrowing $40,000 from College Ave with a 3.87% fixed interest rate and a 15-year term will result in a total interest of $14,822. That's a savings difference of more than $3,000.

Here's a comparison of the two options: