Live in the South? Refinance to a more flexible repayment plan with this nonprofit lender.
| Product Name | Advantage Education Loan Refinance Loan |
|---|---|
| Min Loan Amount | $7,500 |
| APR | 3.74% (as low as) |
| Interest Rate Type | Fixed |
| Minimum Loan Term | 10 years |
| Maximum Loan Term | 20 years |
| Requirements | Credit score of 670 or higher, debt-to-income ratio of 38% or lower, US citizen or permanent resident and live in an eligible state |
- Have a credit score of 670 or higher.
- Have a debt-to-income ratio (DTI) of 38% or lower.
- Be a US citizen or permanent resident.
- Live in an eligible state.
First, am I eligible?
To qualify for student loan refinancing through Advantage Education Loan, you must:
- Have a credit score of 670 or higher.
- Have a debt-to-income ratio (DTI) of 38% or lower.
- Be a US citizen or permanent resident.
- Live in an eligible state.
You can apply with a cosigner to help you meet the credit and DTI requirements. Keep in mind that the more you want to borrow, the stricter Advantage Education Loan’s credit requirements are — you might need a much higher credit score to refinance $250,000. You’ll also need to be a resident of an eligible state, regardless of where your cosigner lives.
You can’t refinance with Advantage Education Loan if you live in …
- Alaska
- Delaware
- Washington, DC
- Idaho
- Illinois
- Iowa
- Maryland
- Maine
- Massachusetts
- Michigan
- Minnesota
- Montana
- Nevada
- New Hampshire
- New Jersey
- New York
- North Dakota
- Oregon
- Rhode Island
- South Dakota
- Vermont
- Washington
How does refinancing with Advantage Education Loan work?
Advantage Education Loan is the loan program for state-based nonprofit lender Kentucky Higher Education Student Loan Corporation (KHESLC). It’s a direct lender that also handles repayments, meaning that your information stays with one company. You can refinance both federal and private student loans with Advantage Education Loan, and parents can also consolidate parent loans and personal student debt.
Borrowers must have at least $7,500 in student debt to qualify. While there’s technically no limit to how much you can borrow, you’ll face tougher credit and DTI requirements with larger amounts. Debts over $300,000 are subject to approval.
What happens if I refinance my federal loans with Advantage Education Loan?
While Advantage Education Loan allows borrowers to refinance federal student loans, it warns that borrowers stand to lose certain perks and benefits that only federal loans offer. These include income-based repayment plans, forgiveness programs and multiple deferment and forbearance options.
Think carefully about what you’re giving up and consider your future before you refinance federal loans with a private lender.
How much will I pay to refinance?
Since Advantage Education Loan doesn’t charge any fees for applying, repaying early or making late repayments, your main cost is interest. Most private lenders offer fixed and variable rates, but Advantage Education Loan only offers fixed rates.
Fixed rates are a safer option. They stay the same while you repay your loan, making it easy to budget for your loan repayments. If you qualify, you’ll get a rate from 3.74% (as low as) . Advantage Education Loan considers factors like how long you need to pay off your loan and your general creditworthiness to determine your rate. The lowest rates tend to go to borrowers who choose shorter terms and have excellent credit.
Does Advantage Education Loan offer any discounts?
It does. All borrowers can qualify for a 0.25% rate discount by signing up for autopay. Kentucky residents who want to refinance an Advantage Education Loan student loan can also qualify for rates as low as 3.99%.
What are my repayment options?
Advantage Education Loan offers two repayment options: standard repayment and graduated repayment. With standard repayment, you’ll make the same fixed repayments until your loan is paid off.
With graduated repayment, your repayments start low and increase by 10% every two years. This option works best for borrowers just starting a career, and can expect their pay to increase over time. It’s less expensive in the short term and can help you avoid defaulting if you have a low-income job. However, this repayment option often has longer loan terms making it more expensive than the standard repayment plan.
Regardless of which plan you choose, Advantage Education Loan requires all borrowers to make minimum monthly payments of $50.
Forbearance
On top of its repayment plans, Advantage Education Loan also offers forbearance for economic hardship or during military deployment, when you won’t have to make any repayments.
While forbearance might help you out of a pinch, it can actually increase your debt in the long run. That’s because once you start making full repayments again, Advantage Education Loan capitalizes your interest. This means it tacks on any interest that added up while you were in forbearance to the amount you were paying off — your principal. You’ll be on the hook for more money and also end up paying more in interest, since interest is a percentage of your loan’s principal.
Top reasons to consider Advantage Education Loan
- Graduated repayment option. If you’re struggling to pay off private loans with a low-income job, the graduated repayment plan could help you avoid default.
- Parent loan refinancing. If you’re paying off both you and your child’s student loans, consolidate all of your education debt with Advantage Education Loan.
- No maximum loan amount. There’s no limit to how much you can refinance with Advantage Education Loan as long as you have a high salary and excellent credit.
- Cosigner release. You can take your cosigner off your loan after making 36 months of on-time repayments and meeting certain credit and eligibility requirements.
- No fees. There’s no application fee or penalty for paying back your loan early if you refinance with Advantage Education Loan. It doesn’t even charge late fees, which is unusual.
Why you might want to look elsewhere
- Not available in every state. While Advantage Education Loan is working to provide refinancing in all US states, it’s currently limited to the South.
- Limited site. There are only two pages on Advantage Education Loan’s refinancing, and doesn’t mention maximum interest rates or which states it extends its loans.
- Limited eligibility information. Eligibility is on a case-by-case basis. It’s difficult to tell if you’ll qualify without applying, which involves a hard credit check that can temporarily hurt your credit score.
Compare more student loan refinancing providers
What do customers say about Advantage Education Loan?
There really isn’t much online about Advantage Education Loan. We weren’t able to find any customer reviews on forums, TrustPilot or the Better Business Bureau (BBB) site.
Advantage Education Loan might not have a BBB page, but KHESLC does. It’s not accredited by the bureau, but it gets an A+ rating based on factors like advertising practices and how it handles customer complaints. As of August 2018, it has no reviews but it does have four customer complaints, most involving billing errors.
One borrower claimed that KHESLC was harassing them for repayments at work, which the company denied. Another said KHESLC mistakenly reported her repayments as late, which was hurting her credit score. But to its benefit, KHESLC has resolved all complaints.
What to expect when signing up
You can complete your Advantage Education Loan application entirely online, though you must use a desktop computer or laptop. You also have to use either Chrome, Safari or Firefox to access the application.
Before you begin, make sure you meet its eligibility requirements and have the following documents on hand:
- You or your cosigner’s most recent W2 form.
- You or your cosigner’s most recent pay stub.
- Login credentials for each loan servicer.
- A payoff statement for each loan you want to refinance.
- A copy of a billing statement from each servicer.
How do I apply?
When you’re ready to start your application, follow these steps:
- Go to the Advantage Education Loan site and click Apply for Refinance.
- Fill out a basic questionnaire and click Check Eligibility.While forbearance might help you out of a pinch, it can actually actually increase your debt in the long run.
- Create an account by entering your name and email and creating a password before hitting Register Account.
- Follow the instructions to complete the application and submit your documents. This step shouldn’t take more than a few minutes. If you’re applying with a cosigner, you’ll receive instructions on how they can set up an account and complete their part of the application.
- Wait for Advantage Education Loan to run a hard credit check and review your application. If you’re approved, it’ll send you an offer.
- Review your offer before signing the promissory note.
Advantage Education Loan disburses the funds directly to your lender. It doesn’t give a timeframe for how long the application takes, though it does prioritize its other student loans over refinancing. If you have any questions during the application process, you can reach customer service by calling 800-988-6333.
How to apply step-by-step with screenshots
More about KHESLC
KHESLC is a semi-private corporation that was created as part of a larger 1978 push to give Kentucky residents greater access to higher education. It’s independent from the State of Kentucky, but run by an executive board appointed by local officials. Its mission is to provide resources like financial aid and educational materials to help Kentucky residents pay for undergraduate, graduate and professional school.
That’s why Advantage Education Loan offers lower rates for Kentucky residents. However, Advantage Education Loans is working to serve all 50 states in the near future.
Bottom line
Refinancing through Advantage Education Loan could make all the difference to someone who’s just starting their career and can’t afford their private student loan payments, thanks to its graduated repayment option. Its rates are relatively low — the highest fixed rate is at least two points lower than what many private lenders offer. You’ll have to live in the right state to qualify, however, and higher loan amounts come with harsher credit requirements.
To find another lender or learn more about how it all works, check out our guide to student loan refinancing.
Frequently asked questions
Image source: Shutterstock and advantageeducationloan.com
