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You can help pay for your loved one’s education without being a parent — all while taking advantage of low rates. The catch? It’s only available in Texas, and you need strong credit to qualify.
Variable APRs: Starting at 2.36%
Fixed APRs: Starting at 2.20%
APR
690
Min. Credit Score
Product Name | Brazos Parent Loan |
---|---|
Minimum Loan Amount | $1,000 |
APR | Variable APRs: Starting at 2.36% Fixed APRs: Starting at 2.20% |
Interest Rate Type | Fixed |
Minimum Loan Term | 5 years |
Maximum Loan Term | 20 years |
Requirements | Live in Texas, have a credit score of 720, or 690 if you’re applying with a cosigner, make at least $60,000, or $30,000 if you’re applying with a cosigner, have a strong credit history. |
Brazos has an unusually long list of eligibility requirements for its parent loans. Here’s how they break down.
The student doesn’t have to be a Texas resident or attend school in Texas.
Brazos Education Lending Corporation is a nonprofit direct lender that offers parent student loans to pay for undergraduate and graduate degrees. As an alternative to Parent PLUS Loans, Brazos offers lower interest rates and more repayment, forbearance and forgiveness options.
While Brazos calls these parent loans, it isn’t entirely accurate. You can use this loan to pay for any student’s education, even if you aren’t related in any way. And federal Parent PLUS Loans are only available for undergraduate degrees, while a parent loan from Brazos can be used for any degree — law school, medical school, an MA in dinosaur psychedelics — it doesn’t matter what the program is as long as it meets Brazos’s eligibility requirements.
Brazos doesn’t charge any fees for applying or paying off your loan early, so the main cost to pay attention to is interest. Brazos offers fixed and variable rates.
Fixed rates are just what they sound like: They stay the same over your loan term, giving you the same repayment each month. If you apply for a fixed rate, you’ll get something in the range of Variable APRs: Starting at 2.36%
Fixed APRs: Starting at 2.20%, including a 0.25% autopay discount.
Brazos comes up with your variable rate by first giving borrowers a smaller fixed rate — called a margin rate — between 3.38% and 6.62%, which includes a 0.25% autopay discount. Then each month, it adds your margin rate to the one-month LIBOR rate. This means the amount you owe each month may increase or decrease, so adjust your budget accordingly.
The rate you get mainly depends on two things: Your loan term and creditworthiness. The lowest interest rates go to borrowers with the highest credit scores and shortest loan terms. Lower credit scores and longer loan terms typically result in higher interest rates.
It does. You can get 0.25% knocked off your interest rate by signing up for autopay.
Brazos only offers one standard repayment plan for its loans, which may last anywhere from 5 to 20 years. You’ll make repayments on the loan’s principle plus interest each month. You can, however, adjust your monthly repayments by going for a longer or shorter loan term. But remember: The longer your loan term, the more you’ll pay in interest.
While Brazos parent loans don’t have as extensive deferment and forbearance options as Parent PLUS Loans, it does offer three choices:
The everyday handling of loans provided by Brazos is done by third-parry servicer Firstmark. Through Firstmark, you’ll be able to pay off your loan in several ways, including online, over the phone, and via check. However, some borrowers have complained about subpar customer service. Read our review to learn how to make the smoothest experience out of repaying your loan.
While there isn’t much about Brazos Education Lending Corporation specifically, its parent company, Higher Education Service Corporation, has a BBB page. It gets an A- review based on its failure to respond to one complaint filed against it. The borrower claimed they had been given a Brazos loan that they weren’t aware they had applied for it.
We weren’t able to find borrower comments specifically about Brazos parent loans, but the few we found about Brazos in general were negative. One person had trouble with Brazos’s loan servicer, Firstmark, particularly when it came to customer service. Another had difficulty affording their student loan payments, which included a Brazos loan. A third thought they could qualify for a better rate than what Brazos offered.
With that said, there are so few online reviews of Brazos student loans and none specifically concerning its parent loans that you might not want to give borrow comments too much weight.
Before you apply, first make sure you’re eligible or have an eligible cosigner on hand.
Meet the requirements? Get together the following documents and information:
Got everything together? Follow these steps to apply:
You’ll get an instant response letting you know if you prequalify with directions on which documents you need to submit. Upload and submit any required documents and wait for Brazos to verify the cost of the student’s school — this part can take a week or so. Then Brazos will send you your loan documents to review and sign.
Give yourself a couple of weeks from start to finish for the Brazos parent loan application. Your repayments will begin 30 days after the school receives your loan funds.
Brazos parent loans could be a good alternative to federal loans for Texas residents who want to pay for a graduate or professional degree. It could even get you a better rate if you have flawless credit. However, its repayment plans are less flexible than a Parent PLUS Loan, and it doesn’t offer cosigner release if you need help qualifying.
Want to find other parent loans or learn more about how student loans work? Check out our guide to student loans.
Interested in refinancing? Brazos offers student loan refinancing as well.
Image Source: Shutterstock and studentloans.com/student-loans/parent-loans.html