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Student Loans

Bank of America Student Loans: What Happened and Alternatives

At one point, Bank of America (BoA) was one of the nation’s largest issuers of private and federal student loans. 

But in 2008, the company stopped offering private student loans altogether. Between 2014 and 2017, BoA sold off its entire $3.9 billion student loan portfolio.

Bank of America still offers resources for learning about student loans, but it is no longer issuing new loans to borrowers. Here’s everything you need to know about Bank of America student loans, plus alternative financing options to consider. 

Does Bank of America offer student loans?

No, Bank of America no longer offers student loans. In 2008, it announced it would stop offering private student loans. The company began selling off its private loan portfolio and instead focused solely on student loans backed by the federal government.

Like many lenders, Bank of America made the switch after deciding the student loan market was unprofitable due to the 2008 financial crisis. After leaving the private student loan business, BoA transitioned into offering federal loans in partnership with the U.S. Department of Education.

These included Stafford Loans, Parent PLUS Loans, and others offered under the Federal Family Education Loan Program (FFELP). This was a safer move for banks during a period of financial instability.

However, in early 2015, Bank of America announced it was selling its $2.7 billion federally backed student loan portfolio. So BoA is no longer originating new loans—but because it once offered federal and private student loans, many borrowers are still repaying their BoA loans.

What if I already have a Bank of America student loan?

If you have a Bank of America student loan, it might have been sold off to a new provider. You can find out your new lender in the following ways.

  1. Look through your personal files: Loan servicers are required to send a notice when the servicing company changes. So you likely got a letter from Bank of America with an update. If you keep old correspondence, look through your files to locate the latest servicing details. 
  2. Check your credit report: Visit AnnualCreditReport to get a free copy of your three credit reports. All your outstanding loans should be listed, each tagged with a loan type. Look for “student loan,” and the servicer is listed under “company.”
  3. Search the National Student Loan Data System: The NSLDS database is strictly for federal student loans. You can log in and search for your outstanding loans using your Federal Student Aid ID.  

Once you find the servicer that took over your Bank of America student loan, review the loan terms. You may consider refinancing your student loan with a new lender, which can save you money if you find a lower interest rate. Just know that you can only refinance with a private lender, so federal student loans that are refinanced will lose their federal benefits.

Alternatives to Bank of America student loans

If you qualify for federal student loans, you should start there when seeking alternatives to BoA. Federal loans offer income-driven repayment plans, loan forgiveness options, and longer forbearance programs than private loans.

However, you can take out a private loan if you don’t qualify for federal loans or if you max out the amount available to you in federal loans. Because Bank of America no longer offers student loans, you’ll have to apply with another lender. The student loan companies listed below are popular alternatives worth considering.

LenderRates (APR)Grace period
College Ave4.07% – 16.696 months
Earnest4.11%16.20% 9 months
Sallie Mae4.50% – 16.70%6 months
Ascent4.09%16.08% 9 months
Comparison of undergraduate student loans

College Ave – Best overall

LendEDU rating: 5 out of 5

  • You choose your repayment terms
  • Cover up to 100% of your cost of attendance
  • Get a decision in just 3 minutes

College Ave is our top-rated lender and offers student loans to undergraduates, graduates, and parents. If approved, you can choose the loan term that best fits your repayment needs and borrow anywhere between $1,000 and the full cost of attendance. 

Plus, you’ll find out whether you qualify for a loan within three minutes of applying. While you’re enrolled, College Ave offers four repayment options. Borrowers who frequently shop online may benefit from applying for a student loan with College Ave. The lender has an agreement with Payce Rewards, which provides cash back that you can use for anything, including your student loans.

If you add a cosigner to the loan, you can remove them halfway through the repayment term and after you’ve made 24 consecutive on-time payments. 

Earnest – Best for no fees

LendEDU rating: 4.7 out of 5

  • No origination, late payment, or prepayment fees
  • Ability to skip one payment per year
  • Check your rate without affecting your credit

Earnest offers student loans to undergraduates and graduates with several repayment terms and in-school payment options. You can find out whether you’re eligible for an Earnest student loan in two minutes without affecting your credit. 

Borrow between $1,000 and 100% of the cost of attendance, and choose to pay off your loan over five to 15 years. You have several repayment options while still in school. One drawback with Earnest is that it doesn’t offer cosigner release.

Earnest lets borrowers set up biweekly payments, which may be easier to align with their paychecks. Also, you have nine months after leaving school to start making payments. The ability to skip one payment each year may come in handy if you lose your job or have an emergency.

Sallie Mae – Best for cosigners

LendEDU rating: 4.8 out of 5

  • Shortest cosigner release period 
  • Loans for undergraduates, graduates, and career training
  • Get a decision within 10 minutes

Sallie Mae is one of the largest private student loan companies. It offers undergraduate, graduate, and non-degree-seeking loans. You can apply for a loan with Sallie Mae and hear back within 10 minutes.

Sallie Mae’s Multi-Year Advantage means 90% of students will qualify for subsequent funding when they apply again with Sallie Mae. Borrow up to 100% of school-certified costs, and spread out your payments between five and 15 years. You have three options for making payments while still in school.

Sallie Mae has one of the easiest cosigner release programs. Borrowers only need to make 12 consecutive on-time payments before having the cosigner removed from the loan. You’ll have access to various repayment options and a six-month grace period.

Ascent – Best for eligibility

LendEDU rating: 4.3 out of 5

  • Undergraduates may be eligible for a free coaching program
  • 1% cash back at graduation
  • Check your rate without affecting your credit

Ascent is one of the only private lenders on the market that offers student loans to borrowers without a cosigner. If you don’t qualify for federal loans and have no cosigner, your lending options are much more limited. 

Plus, you get a 1% discount when you enroll in automatic payments without a cosigner and a 0.25% discount for automatic payments on credit-based loans. Borrowing limits are more restricted than other lenders, ranging from $2,001 to $200,000. Repayment terms last between five and 15 years, plus you’ll have three payment options while you’re enrolled.

Borrowers who use a cosigner can remove them after 12 months of on-time payments. That’s a shorter time frame than many other lenders. You can also earn a 1% cash-back bonus after graduation.

Recap: Bank of America alternatives

LenderRates (APR)
College Ave4.07% – 16.69
Sallie Mae4.50% – 16.70%