Alternatives to Bank of America Student Loans
Bank of America stopped issuing new student loans. Find out what that means for borrowers who previously took out loans through the company and find alternative lenders who you can either refinance with or apply to take out new loans through.
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Bank of America was at one point one of the largest issuers of student loans in the nation—offering private loans, federal loans, and even student loans like the Education Maximizer Loan and the Campus Edge student loan.
But this changed in 2008 when the company stopped offering private loans altogether. Between 2014 and 2017, the company sold off its entire $3.9 billion student loan portfolio.
Bank of America still has a portal for borrowers who need to repay their loans, but they are no longer issuing new student loans to borrowers. As a result, many people are looking for alternative lenders.
On this page:
- Alternative to Bank of America Student Loans
- Options If You Still Have Bank of America Student Loans
- History of Bank of America Student Loans
Alternative to Bank of America Student Loans
If you were looking to take out a student loan to pay for college, you have many other great options to consider.
This section will take a look at two of our top choices, Citizens Bank and College Ave. Both of these lenders offer both new private student loans as well as student loan refinancing if you have Bank of America student loans but want a new lender or better rate.
Citizens Bank Student Loans
5.25% – 12.09%
4.47% – 12.34%
5, 10, or 15 years
Citizens Bank is one of our highest-rated lenders for both new student loans and refinancing.
Their private student loans range from a loan amount of $1,000 to $175,000. Their current variable rates start at 4.48% APR and fixed rates currently start at 5.25% APR.
Citizens Bank lets borrowers decide whether they want to make full payments, interest-only payments, or defer their payments entirely while they’re still in school. Once they’ve graduated, borrowers can choose between a 5, 10, or 15-year repayment plan.
Citizens Bank won’t charge any application or origination fees on their loans. And you could earn a rate discount by enrolling in autopay.
College Ave Student Loans
5.29% – 12.78%
4.07% – 11.32%
5, 8, 10, or 15 years
College Ave is also one of our highest-rated lenders for both private student loans and refinance loans.
College Ave’s private student loans range from $1,000 to $175,000. Their current rates include fixed rate loans starting at 5.29% APR and variable rates starting at 4.07% APR.
Borrowers who don’t have a good credit score will be required to apply with a cosigner. But the company allows you to apply for a cosigner release after 24 months of consecutive, on-time payments.
There are flexible repayment options available. Borrowers can choose whether they want to make interest-only or full payments while in school or defer them until graduation. And borrowers can choose either an 8, 10, 12, or 15-year repayment plan.
>>Read More: Best Private Student Loans
Options If You Still Have Bank of America Student Loans
Due to Bank of America’s shift away from student lending, it has not been a primary focus for the company. This has led many borrowers to feel unhappy with the service they are receiving and wonder if they could receive better rates elsewhere.
Fortunately, borrowers who meet certain eligibility requirements should be able to refinance their student loans to get a new lender and possibly a better interest rate.
The History of Bank of America Student Loans
In 2008, Bank of America announced it would stop offering private student loans and other student loan options to borrowers to cover education expenses. The company began to sell off its private loan portfolio and began focusing on student loans sponsored by the federal government.
Like many lenders, Bank of America made the switch after deciding the student loan market was unprofitable due to the ongoing financial crisis. After leaving the private student loan business, Bank of America transitioned into offering federal loans in partnership with the U.S. Department of Education.
This included Stafford Loans, Parent PLUS Loans, and other loans offered under the Federal Family Education Loan Program (FFELP). This was a safer move for banks during a period of financial instability.
Then in early 2015, Bank of America announced it was selling its federally-backed student loan portfolio. They placed their $2.7 billion loan portfolio for sale.
Since Bank of America once offered both federal and private student loans, there are still many borrowers repaying loans they took out from Bank of America.
The 2008 financial crisis affected many banks, including Bank of America. The company used to offer a competitive product and was one of the largest companies in the student loan industry.
If you still have loans through Bank of America and are unhappy with the service you’ve been receiving, there are other options available. By refinancing them through another lender, you could be saving yourself money in the long run. And if you’re looking to take out a new loan entirely, there are many good lenders who can help you.
Author: Jeff Gitlen
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