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Available to borrowers of all 50 states, with discounts for Iowa residents, IT professionals and engineers.
Nonprofits tend to be known for offering competitive interest rates on loans and other financial products. Iowa Student Loan is no exception. The maximum APR is 7% — lower if you live in Iowa. Put into perspective, that’s an APR where some of the competition starts.
On top of these low rates, it offers multiple repayment options to give you flexibility. You could also qualify for a rate discount if you are an IT professional or engineer.
The catch: You need to have stellar credit to qualify. Read on to find out if Iowa Student Loans can help you save on your student debt.
3.75% to 7%
APR
5, 10 or 15 years
Max. Loan Amount
Credit score 720+, debt-to-income ratio 40% or lower, no student loan default or previous bankruptcies.
Anna Serio is a staff writer untangling everything you need to know about personal loans, including student, car and business loans. She spent five years living in Beirut, where she was a news editor for The Daily Star and hung out with a lot of cats. She loves to eat, travel and save money.
First, am I eligible?
To meet Iowa Student Loan’s most basic eligibility requirements, you or your cosigner must:
Have a credit score of 720+
Have a debt-to-income ratio of 40% or less
Be a US citizen or permanent resident
Be the age of majority in your state (usually 18)
Have no more than two credit accounts with 30-day delinquencies in the past two years
Have no credit account with a 60-day delinquency in the past two years
Have none of the following: previous student loan defaults or bankruptcies, repossessions, foreclosures, charge-offs, judgements, collection accounts, wage garnishments or tax liens.
How does refinancing with Iowa Student Loan work?
Refinancing with Iowa Student Loan is similar to refinancing or consolidating with many other providers: You take out a new loan to pay off your private or public student debt, preferably with lower rates. You aren’t limited to a certain number of loans as long as you fit within its borrowing requirements.
Iowa Student Loan is a private student loan provider that underwrites its loans and uses its subsidiary, Aspire, to service its loans. Who originates your loan depends on where your live — you’ll likely borrow from a local bank that you won’t deal with directly.
You can complete the entire application process online, which can take anywhere between to 30 to 60 days from start to finish. The amount of time you have to spend on it is minimal, however: A few minutes at a time filling out the application, gathering your information, collecting documents and reviewing your loan’s terms.
While Iowa allows you to refinance federal loans, it makes a point of warning that you’ll lose several benefits by doing so. Some of these include, federal forgiveness programs, income-based repayment plans and the option to adjust your loan term while you’re in repayment.
Costs
One of the perks of borrowing from Iowa Student Loan is it doesn’t charge any fees at all — including prepayment, late and nonsufficient funds fees. You should ideally start to save on your loan by refinancing with Iowa Student Loan. It offers fixed rates that range from 4% to 7% and 3.75% to 6.75% if you live in Iowa — with a choice between 5, 10 or 15 year loan terms.
Discounts
If you’re an Iowa resident, you’ll automatically get a 0.25% discount on your interest rates. Any applicant could benefit from one of the following discounts:
Auto debit discount. Get a 0.25% discount on your interest rate if you sign up to have automatic repayments deducted from your bank account each month.
IT and engineering discount. If you work in either of these fields, you might be able to qualify for a 0.20% to 0.80% discount on your interest rates. You’re more likely to qualify for this discount if you have a credit score of at least 800 and are eligible for the lowest possible rate.
What are my repayment options?
Choose from one of the following repayment options while you’re setting up your account with your loan servicer, Aspire:
Standard. Pay the same amount each month until you’ve paid off your loan. This is the repayment plan you’ll automatically get if you don’t reach out to Aspire to ask about setting up another option.
Graduated. Start with lower repayments that increase by 10% every two years. This repayment plan is only available for 10- or 15-year loan terms. To choose this repayment plan, you’ll need to reach out to Aspire before your repayments begin.
Select 2. Make interest-only repayments for the first two year of repayment and full repayments during the rest of your term. Like the graduated plan, this is typically only an option for loans with terms of 10 years or longer. And you’ll also have to reach out to Aspire to sign up for this option.
Does Iowa Student Loan offer forbearance?
Yes, you have two forbearance options through Iowa Student Loan:
Hardship deferment. If your DTI jumps over 40% during the life of your loan, you could qualify to defer your loan for up to 24 months. But, interest continues to accumulate during this time.
Military deferment. If you’re deployed to a war zone, Iowa Student Loan lets you defer your loan with 0% interest while you’re overseas.
Top 5 reasons to consider Iowa Student Loan
Competitive rates. Even without the discounts Iowa Student Loan offers, Reset Refinance Loans come with rates that stop where some lenders start.
No fees. You don’t have to pay any application, origination, late or nonsufficient fees, or prepayment penalties.
Discounts. If you work in IT and have excellent personal finances, you could get your interest rates knocked down as much as 0.8%. Alternately, you can sign up for auto debit to get a 0.25% discount. On top of this, Iowa residents automatically qualify for a rate that’s 0.25% lower than other applicants
Multiple cosigners allowed. If you have a high debt load, you can apply with up to two cosigners. In these cases, Iowa considers your cosigners’ combined income and debts, plus the highest credit score between the two.
Death or disability forgiveness. If you pass away or become permanently disabled, Iowa Student Loans will forgive your debt. If your cosigner passes away or becomes permanently disabled, it allows you to take them off your loan without requiring an additional cosigner.
Why you might want to look elsewhere
High credit requirements. You must have a credit score of at least 720 to qualify for a loan — and 800 or more if you want to qualify for the IT and engineering discount.
Long turnaround. It can take up to 60 days for your application to go through.
No variable rates. You can only take out a loan with interest rates that don’t change over the life of your loan.
Hard-to-navigate website. While most of the information is available online, it’s not always obvious where to find it. For instance, you need to visit its servicer’s page to find your repayment plan options.
Compare more student loan refinancing options
Updated September 16th, 2019
What do customers say about Iowa Student Loan?
Mostly negative things — though it doesn’t have a large online presence. Iowa Student Loan itself doesn’t have a Better Business Bureau (BBB) page, but its servicer Aspire does. It’s not BBB-accredited, but it gets an A+ rating, based on factors like transparency and advertising practices.
It has three reviews, all of which are negative, and 14 customer complaints filed against it with the BBB. Complaints cover a range of issues with repayment, including double charges on repayments, capitalization on interest at the wrong time and on-time repayments mistakenly being recorded as late. A couple also had trouble getting correct information when they called Aspire’s customer service line.
Neither Iowa Student Loan nor Aspire have a Trustpilot page. The few mentions sprinkled across other forums like Reddit mainly involve advice on how to deal with defaulting on an Iowa Student Loan.
US Bank lawsuit against Iowa Student Loan
In 2007, a former US Bank executive filed a lawsuit against Iowa Student Loan, accusing it of attempting to create a monopoly on student loans. Specifically, she accused it of paying incentives to banks to market private student loans in a way that undermined their involvement in federal loans programs, which she argued was illegal. Iowa Student Loan’s lawyer argued that they were acting according to federal law. It’s unclear how the judge ruled on this case.
What to expect when signing up
To make your application as seamless as possible, get the following documents together for you or your cosigner before you sign up:
Two W-2 forms
Two most recent pay stubs
Two reference letters per cosigner
Three reference letters per borrower
Steps to apply
It also recommends that you use an online service to do a soft credit pull so you have an idea of your personal credit score. Once you’ve done these two things, you’re ready to start your application.
Go to Iowa Student Loan’s website and click Private Student Loans.
Once on the private loans page, click Apply Now under Reset Refinance in the left-hand navigation box called Private Student Loans.
Select your state and click Apply Now.
Read the application and credit agreement and hit Enter Applicant Information. If you’re applying with a cosigner, you can start the cosigner addendum by clicking the link below this button.
Follow the directions to fill out your application, reading all disclosures carefully. To prove that you’ve at least scrolled through the disclosures, Iowa Student Loans requires you to enter a numeric code at the bottom of each document before you can accept its terms.
Submit your application. At this point, Iowa Student Loans will do a hard credit check that negatively affects your credit score.
Wait between 24 and 48 hours to get an offer on your rates.
Accept your terms and upload any required documentation.
Wait between eight and 10 business days for Iowa Student Loan to underwrite your loan and put together your loan offer.
Review and accept your offer, and wait for your final disclosure.
Review and accept your loan’s final disclosure. Once you’ve signed these documents, you have three days to change your mind and cancel your loan without penalty. If not, Iowa will start reaching out to your lenders to pay off your loans, notifying you as it happens.
Reach out to Aspire by calling 800-243-7552 to set up your repayment plan once your funds are disbursed. If you don’t, your repayments will default to the standard repayment plan.
Application process with screenshots
Select the link below the Enter Applicant Information button if you are a cosigner.
At this point, Iowa Student Loans will do a hard credit check that negatively affects your credit score.
More company info on Iowa Student Loan
Iowa Student Loan is a non-profit organization that’s been around for over 35 years and only offers student financing. It also offers two different private student loans: Partnership Loans and College Family Loans.
Partnership Loans allow students to take out a private loan for school with a cosigner and are only available for residents of Iowa or borrowers attending an eligible Iowa institution. College Family Loans allow parents or family members to borrow on the behalf of a student and are available nationwide.
Iowa Student Loan uses profits to fund scholarships and educational programs to help students and families become more financially literate. To qualify for a scholarship, you must be a high school senior and Iowa resident or planning on attending an eligible school in Iowa.
Scholarship amounts range from $250 to $2,000, so you won’t be able to make much of a dent in your tuition with them alone.
Bottom line
You don’t need to be an Iowan to benefit from Iowa Student Loan refinancing, but it doesn’t hurt. This loan is the best deal for IT professionals or engineers living in Iowa but that doesn’t mean you can’t benefit from it too. Its rates are capped where many for-profit lenders start, and its relatively flexible repayment plans can make repayment more affordable in the short- or long-term, if not both.
While you won’t be charged a fee, its loan servicer Aspire will report your late payment to credit unions and it could negatively impact your credit score.
No, you can only qualify for one or the other.
No — technically this makes it consolidation, but most lenders use the term consolidation and refinance interchangeably when talking about student loans. The only requirement is that the debt you apply to refinance is between $5,000 and $150,000.
Iowa Student Loan allows you to refinance any education loan, regardless of school. In fact, you aren’t even required to have a completed degree from an institution.
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