Citibank Student Loans: Alternatives to Consider

Citibank stopped offering student loans in 2010 when they sold their student loan division, The Student Loan Corp.

As a result of the sale, Sallie Mae took over $26 billion of Citi’s federal student loans, the Department of Education assumed $4.7 billion in federal loans, and Discover took over $4 billion in private student loans.

Citi did purchase back a small portion of their private and federal student loans (yes, it’s confusing) but they finished servicing all remaining loans in 2017.

To summarize, Citi is no longer offering student loans, and though they previously offered a refinancing option, that too has been discontinued.

In this review:

• Citi Student Loan Servicing Fined by the CFPB
• Alternatives to Citibank Student Loans
• Refinancing Citibank Student Loans

Citi Student Loan Servicing Fined by the CFPB

Despite stopping all the student loan activity, including removing information from their website and product catalog, Citi’s student loan story doesn’t end there.

Unfortunately, for both customers and Citi alike, the Consumer Financial Protection Bureau (CFPB) fined the lender for illegal student loan servicing practices, such as misleading borrowers and inaccurate late fees.

As a result, Citi had to pay a $2.75 million dollar fine and return $3.75 million to affected borrowers.

Will I Receive a Refund from Citi?

The legal activity and subsequent retribution came to a head in 2017, and many student loan borrowers that had loans serviced by Citibank between 2006 and 2015 were eligible for a refund between $47 and $250.

Borrowers who still had education loans serviced by Citi at the time of retribution should have received a statement credit on their account. If impacted loans were paid off or eventually serviced by another company, then Citi was required to send a refund check via mail.

In other words, if you were eligible, you should have received a credit by now. However, to find out more about the CFPB’s action against Citibank, you can visit the CFPB website.

Alternatives to Citibank Student Loans

Though securing a student loan through Citibank is out of the question, there are many other private student loan lenders out there who provide loans to eligible borrowers in need of financial aid.

Check out our Best Private Student Loans page to see other options or read on to learn more about some alternatives.

SunTrust Student Loans

SunTrust is a financial services company that offers customers a wide range of products including checking accounts, mortgages, personal loans, and of course, student loans.

Their student loan portfolio includes three primary products: The Custom Choice Student Loan, Union Federal Private Student Loan, and the Graduate Business School Loan.

The Custom Choice Student Loan and Union Federal Private Student Loan customers can borrow up to $65,000 for a 5, 7, or 10-year term, while Graduate Business School Loan customers can take out up to $95,000 for a 7 or 10-year term.

SunTrust’s loans currently have variable interest rates as low as 4.38% and fixed interest rates as low as 5.35%.

>> Read our full review: SunTrust Student Loan Review

Sallie Mae

Sallie Mae took on a significant portion of Citibank’s loans back in 2010 and they remain one of the largest private student loan lenders today.

They offer undergraduate and graduate loans as well as numerous concentration-specific loan products. They also provide parent loans and even loans for K-12 learning.

Sallie Mae’s undergraduate and graduate loans can be used to cover all of a student’s academic expenses. Borrowers can expect loan terms between five and 15 years with variable rates currently as low as 4.62% and fixed interest rates as low as 5.74% for undergraduates and 6.25% for graduate borrowers.

Refinancing Citibank Student Loans

If you have student loans from Citibank and would like to see if you can save money on them or change your servicer, you could look into student loan refinancing. If you have a good credit history and steady track record or making on-time monthly payments, you may be eligible for a lower interest rate with a different private lender. 

To learn more about how this works and to compare lenders, check out our guide to refinancing student loans. 

Bottom Line

Though Citibank once offered loans to student borrowers, due to a somewhat jaded history, the financial organization no longer originates or refinances student loans. If you were considering a Citibank student loan, you’ll have to look elsewhere, though there are a variety of comparable lenders, including SunTrust and Sallie Mae.