Iowa Student Loan Review
- June 24, 2015
- Posted by: Dave Rathmanner
- Category: Student Loans
Ever heard the saying “I flew over Iowa once”?
Unknown to most, the state of Iowa is an incredible place. The LendEDU team was lucky enough to experience Iowa at its fullest during the Fall of 2014. LendEDU participated in the Iowa Startup Accelerator in Cedar Rapids, Iowa. Student debt are a huge issue in the United States, and especially in Iowa.
Many Iowans look towards Iowa Student Loan as a source for getting private student loans. You may have heard and seen the recent controversial media surrounding the company.
At LendEDU we did a little research on Iowa Student Loan and put what we found into this review. If you are looking for a student loan from Iowa corporation, you should know the facts first. Moreover, if you are looking to refinance college debt you should know some great alternatives to the company.
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What is Iowa Student Loan?
The company is a private student loan lender. According to the company’s website, over 386,000 students have used the company's products to pay for college.
The company is based out of West Des Moines, Iowa. The company is technically a non-profit, however, ISL is not in any way connected to the Department of Education. All of the company’s student loans are funded by private lenders in the state of Iowa. The company's lenders include the University of Iowa Community Credit Union and Veridian Credit Union.
ISL products are financed by private banks in the state of Iowa. To qualify for an Iowa Student Loan Partnership Loan, you must live in Iowa and/or go to school at a qualifying Iowa institution. If you are approved for financing from the Iowa company, you should expect to pay at least 3.96% in interest each year. The company offers both variable and fixed interest rate options.
You should know that the Iowa corporation does charge origination fees. Origination fees are fees charged to the borrower to create the student loan. ISL charges a 3% origination fee on some of its private collegiate debt products.
ISL also offers another private college financing option called the Iowa Alliance Loan. The Iowa Alliance Loan is educational financing that does not require a cosigner. Because the Iowa Alliance Loan does not require a cosigner, the interest rates and origination fees charged are very high. The Iowa corporation’s Iowa Alliance Loan has an annual percentage rate of 9.82%.
Moreover, the company charges a whopping 10% origination fee. To put these fees in context, most private education financing lenders do not charge origination fees. ISL does offer a 1.00% interest rate reduction benefit if you make your first 24 monthly payments of principal and interest on time.
We recommend looking for lower cost private student loans before applying to Iowa Student Loan.
Refinance Iowa Student Loan Debt
Refinancing ISL debt is a potential option for student borrowers who are graduated with high income and good credit history. As we found, the company has very high interest rates and origination fees. Refinancing educational debt could be an option for borrowers looking to lower the interest rate they pay. College debt consolidation is the process of refinancing old private and federal educational debt with a new private student loan lender.
There are plenty of private consolidation lenders on the market. A number of the best student loan consolidation companies offer competitive interest rates.
ISL does not offer student loan refinancing.
Alternatives to Iowa Student Loan for Students and Parents
The company offers only private educational options. You should use federal financial aid options before considering private financing.
Federal financial aid have far lower interest rates than the private student loans offered by ISL. Furthermore, federal financial aid offer many benefits that ISL does not. Federal student loans may have subsidized interest while you are in school. And, when you graduate, federal student loans have many built in protections in case you run into financial trouble. Scholarships are also a great alternative to the company. There are tons of scholarships these days!
You should use federal student loans before signing up for an Iowa Student Loan. And, if you do need a private student loan you should consider other lenders before Iowa Student Loan. Lastly, if you already have Iowa Student Loans you should consider private student loan refinancing.