Edly Review: Income-Based Repayment Loans

Best no-cosigner student loan for income-based repayment

Payments are based on a percentage of postgrad income and adjusted annually.
Payment is not required if salary is less than $30,000 annually.
Borrow $5,000 to $15,000 per academic year, $10,000 per summer semester; $25,000 lifetime limit.
Built-in protections, including deferred payment due to job loss.

Loans available through Edly are unsecured educational loans that are issued by FinWise bank, a Utah-chartered bank, Member Federal Deposit Insurance Corporation (FDIC) insured. Degree-seeking students at an Edly-supported school currently have two loan options: the Edly IBR No Cosigner Student Loan (for university students without a cosigner) and the Edly IBR Cosigned Student Loan (for university students with a cosigner).

Edly is an education lending platform that offers an alternative to traditional private student loans through income-based repayment (IBR) student loans.

Launched in 2019, Edly provides innovative funding options for students to complete their degrees. Its mission is to make college affordable and accessible for all. It doesn’t require a cosigner on the Edly IBR non-cosigned product (a minimum credit score does apply, and an adverse credit history can affect eligibility, though students without a credit score may still be considered).

The goal of basing payments on a percentage of your postgrad salary is to minimize borrowers’ student debt burden through flexible terms tied to your ability to pay.

Edly aims to help close what it says is a growing funding gap in what is covered by federal student loans and financial aid and the remaining costs of higher education.

Source: Edly

How does Edly work?

Edly’s income-based repayment student loan options are available to graduate students or undergrads within two years of graduating from one of the more than 1,700 approved schools and select programs Edly supports for the non-cosigned product. The cosigned product is available to graduate students or undergrads within three years of graduating in any program within one of the 1,700 approved schools.

For the no-cosigner product, payments aren’t required while you’re in school or during the four-month grace period after graduating or leaving school. Once you’ve secured a job paying at least $30,000 annually, payments begin.

Your monthly payments are a fixed percentage of your gross annual income. If your income changes year to year, so will your payments, as long as you make at least $30,000. If your income falls below this threshold, you can request forbearance, but interest continues to accrue.

Edly approves loans and offers amounts based on your academic year, so you must apply for a new loan for each year of school to be funded through Edly. Amounts vary based on your needs and Edly’s limits of $5,000 to $15,000 per academic year, but will not exceed $25,000 total for your lifetime.

Rates, terms, and fees

There are several elements to know about Edly’s income-based repayment student loans.

While your income-based repayment percentage is fixed, the effective APR of these payments can range from 9.40% to 23.00%, as of June 2023.

Edly does not disclose what percentage of your income you’ll owe prior to filling out an application.

This makes the overall loan cost less predictable on Edly loans than those of fixed-interest-rate student loans. But a major benefit of Edly loans is that payments can decrease or stop altogether if your earnings drop. Here’s a closer look at the details of Edly’s loans.

Terms	Details
Loan amounts	$5,000 – $15,000 per academic year $10,000 per summer semester $25,000 lifetime limit
In-school repayment	No payments required for the no-cosigner product, while the cosigned product requires payments
Repayment terms	84 post-graduation months
Grace period	4 months for no-cosigner product (none for the cosigned product)
Repayment assistance	Forbearance, but interest accrues at a growth rate of 22.75% on unpaid balance
Cosigner release	If using a cosigner, they can be released after you make six successive post-graduation qualifying payments with no outstanding balance, meet the minimum FICOm and do not exceed the maximum DTI
Fees	A late charge equal to the lower of 6% or $25 is applied whenever a payment is made more than five days after the payment due date. A fee of $25 is applied for returned check payments or non-sufficient funds payments.
Unique features	No minimum credit score for the student borrower for the cosigned loan (cosigner will need to meet undisclosed minimum requirement) Repayment is based on income.

What are the eligibility requirements?

Cosigners are not required to qualify for income-based student loans from Edly. Applicants must meet the following basic eligibility criteria:

Eligibility requirement	Details
Citizenship	Must be a U.S. citizen or permanent resident
State of residence	All states except Colorado, Iowa, Maine, Vermont, and West Virginia
Minimum age	Must be at least 18 years old
Enrolled school	School must be an accredited institution supported by Edly Program must also be supported by Edly for the no cosigner loan (all programs accepted for approved schools for cosigned loan)
Enrollment status	Enrolled at least half-time and meeting Satisfactory Academic Progress
Minimum credit score	Not considered for the student borrower on the cosigned product (cosigner must meet undisclosed requirement). Minimum credit score applies on the non-cosigned loan but student borrowers with no FICO score may still be eligible
Minimum income	Not considered

Edly reviews credit history, and adverse events such as loan defaults, bankruptcies, and collections can affect your eligibility. Applicants must meet their school’s Satisfactory Academic Progress guidelines. If the student borrower does not get approved for the non-cosigned product, they will have the ability to reapply with a cosigner.

Edly is selective with schools and programs it supports. For its IBR no cosigner loan, it focuses on students in majors such as nursing, science, technology, engineering and mathematics (STEM), business, education, and healthcare. The IBR cosigned student loan is open to all majors at approved schools and programs.

Edly does not publish a list of supported schools and programs on its website, but you can verify your school and program’s eligibility by checking your terms, which Edly says takes 30 seconds and doesn’t affect your credit score.

How does repayment work?

Edly offers more assistance in repayment than most student loan lenders because payments are based on your income, although the adjustable payments can make total costs unpredictable.

Here is how repayment through Edly works:

Edly determines an initial monthly payment amount when it approves the loan based on the tuition amount financed. This amount is different than what your income-based payments will be and may be a higher percentage of your income.
Payments are deferred while you are in school and during a four-month grace period postgraduation for the non-cosigned product. However, the in-school payments are required for the cosigned product and switch to income-based upon graduation.
On the non-cosigned product, once your grace period ends and you secure a job that pays at least $30,000, repayment begins. You pay your initial monthly payment amount based on the time set in your loan terms and conditions, even if it is a higher percentage of your income than your fixed income percentage rate.
After your initial payment period ends, your monthly payment is adjusted to reflect a fixed percentage of your pre-tax income. This adjustment occurs annually until you reach the end of your repayment period, which is typically 84 months.
If your income drops below $30,000, payments stop. You can defer payments until your income increases above that threshold again (maximum forbearance of six months applies to the cosigned product). Interest continues to accrue on the unpaid balance during this time at a growth rate of 22.75%.
You’ve paid off your loan once you’ve done the earlier of:
1. Paid 2.25 times the amount borrowed (2.5 times for the cosigned product).
2. Paid the equivalent of 23% APR on the loan amount.
3. Fulfilled your number of required monthly payment obligations—even if you haven’t repaid your entire loan amount.

With Edly’s income-based repayment model borrowers sacrifice the predictability of fixed rates found through traditional private student loan lenders, and you can see how overall loan costs can also vary. For some, however, the tradeoff is worthwhile for payments based on affordability.

How can Edly improve its private student loan?

To improve its private student loan product, Edly could focus on the following areas:

Higher loan amounts. Higher maximum loan amounts beyond the $25,000 lifetime limit would allow students to better cover college costs, especially at private and graduate schools. Traditional loan lenders such as College Ave, Sallie Mae, and Ascent offer up to $200,000 or more.
Longer grace periods. Lengthening its grace period from four months to six or nine months to be more in line with competitors including Earnest (nine months) and Sallie Mae (six months) and provide added relief for new graduates before starting repayment.
More repayment options. Edly could offer more options for early repayment beyond repaying 2.25 times the amount borrowed (or 2.5 times for the cosigned product) or 23% APR. Competitors often allow early payoff or in-school payments without penalty, providing flexibility that may interest some borrowers.
Expand eligibility. Edly could expand eligibility to more schools, majors, stages of study, international/DACA students, cosigners, and levels of education. Funding U and MPower offer private student loan eligibility to a wider range of applicants.
Expand accessibility. As of June 2023, Edly excludes Colorado, Iowa, Maine, Vermont, and West Virginia. Many competitors offer private student loans in all states.

How have Edly student loans evolved over the years?

Edly began in 2019 as an income-share agreement (ISA) provider. ISAs offered students funding for their education in exchange for a fixed percentage of their postgraduate salaries for a set period, without charging interest. Edly’s ISAs were backed by impact investors seeking financial and social returns.

Since then, Edly made the switch to offering IBR loans in place of ISAs. Its IBR loans are bank-funded by FinWise Bank, though impact investors can also invest. Its IBR loan payments are capped at a percentage of the borrower’s income.

In 2022, Edly expanded support for students in high-demand fields like nursing, science, technology, engineering, and math (STEM), and accounting. Its evolution reflects its mission to increase access to higher education through innovative funding models.

How do Edly private student loans compare to other lenders?

Among private IBR loan lenders, Edly has few direct competitors. Stride, an income share loan provider, offers the most similar alternative.

There are also some traditional private student loan lenders that don’t require a cosigner and consider factors other than credit score in eligibility. Ascent, for example, offers a future-income-based loan that doesn’t require a cosigner.

Here is a look at how Edly compares to Stride and Ascent:

	Edly	Stride	Ascent
Product	Income-based repayment student loan	Income share loan	Future income-based student loan
Our rating	4.4/5	Not rated	4.7/5
Best for	Income-based repayment	Income-share agreements	Deferred repayment
Loan amount	$5,000 – $15,000 per academic year$10,000 per summer semester $25,000 lifetime limit	$2,500 – $25,000 per year	$2,001 $20,000 per academic year
Terms	84 months	60 months	10 or 15 years
Grace period	4 months (for non-cosigned product)	3 months	9 months
Availability	1,700+ supported schools	140+ supported schools	All 50 states and Washington D.C.
Payment cap	2.25 times the loan amount (2.5 times for the cosigned product) or equivalent to 23% APR	2 times the loan amount or equivalent to 21% APR	None
Payments based on	Income	Income	Principal + interest, regardless of income
	Learn more	Learn more	Learn more

Is Edly a reputable lender?

Little data exists to determine Edly’s reputation and to gain a clear sense of customer experience or how well it meets student needs. It only has one entry on the review platform Trustpilot, earning just one star out of five due to login and application issues.

Accreditations and affiliations provide some additional insight. FinWise Bank, which funds the loans, is an FDIC-insured Utah-chartered bank that’s accredited with the Better Business Bureau (BBB), a membership organization that rates businesses.

Edly’s partnership with FinWise suggests trustworthiness and compliance with certain standards. FinWise has an A rating on BBB but 1.23 stars from a few reviews pointing to potential areas of improvement around transparency, communication, and customer support, but they are not specific to Edly.

Consider this lack of reputational data a signal that doing thorough research is essential.

Does Edly have a customer service team?

Edly operates out of New York and has a customer service team that can help with:

Completing loan applications and enrollment.
Answering questions about loan terms, interest rates, or amounts due.
Discussing options for temporary relief or payment changes during financial hardship.

Edly uses a third-party loan servicer, Firstmark Services, a subsidiary of Nelnet. Edly originates the loans, and FDIC-insured FinWise Bank issues them. Firstmark Services then handles the loans, so students might contact Firstmark with account and repayment questions.

To contact Edly, students can:

Call toll-free 888-4MY-EDLY Monday to Friday 8 a.m. to 7 p.m. Eastern time.
Chat live with a representative on Edly’s website during business hours.
Visit https://student.edly.co/contact to complete an online contact form.
Email Edly’s reps at [email protected].
Mail: Edly Inc., 555 Pleasantville Rd, STE N202, Briarcliff Manor, NY 10510

How to apply for an Edly student loan

Applying for a student loan through Edly differs from most traditional lenders. Rather than just credit scores, Edly takes a broader view of your earning potential and ability to repay in determining approval and terms.

The streamlined process makes exploring your options and finding out what you qualify for straightforward with no obligation.

To apply for an Edly student loan:

1. Check your eligibility

In minutes online, see whether your school, major, and graduation date meet its requirements. Edly does a soft credit check showing estimated terms you may prequalify for with no impact to your score or commitment to apply.

2. Apply online

When ready to pursue approved funding, complete Edly’s application, and include all requested information. For the fastest experience, prepare documents including proof of enrollment, tuition bills, and funding need estimates, before applying.

Edly conducts a hard credit check at this point, which will drop your credit score by a few points. However, being declined due to credit is unlikely unless you have adverse events on your history because scores alone don’t determine eligibility. If you do not qualify for a non-cosigned loan, you can reapply with a cosigner.

Edly evaluates your future potential to gauge eligibility and terms over credit alone. Its broader view assesses total costs, enrollment duration, earning prospects for your program, and career to craft loan amounts and payments you can feasibly manage over time based on income growth projections.

3. Provide additional documents

You may need to submit enrollment or tuition verification to complete the application. Edly guides you through next steps required online.

4. Review and sign

Once you’re approved, Edly determines the amount you can borrow based on costs remaining after financial aid and family contributions and provides an offer to review. If you accept, you’ll sign electronically. Expect the offer to outline amounts approved based on costs or loans from other sources.

Once the process completes and enrollment is verified, Edly pays the loan funds directly to your school. Your school may refund excess amounts to you or Edly for additional expenses, including books and living costs.

What if I’m denied a student loan from Edly?

If Edly denies your application for a student loan, federal law requires it to notify you why. Reasons may include poor credit history, such as prior loan defaults or collections. Edly may also deny based on academic factors, such as not meeting Satisfactory Academic Progress guidelines.

The best alternative is to first make sure you’ve applied for all available federal student aid, such as grants, work-study, and federal student loans. Federal aid does not require a credit check or cosigner.

If you are denied for the IBR non-cosigned product, you can reapply using the IBR cosigned product with Edly. If you do not have access to a cosigner you can reapply for the IBR non-cosigned product after building your credit, improving your academic progress, or enrolling in an academic program they support.

Private student loans from other lenders are another option. Most private lenders consider credit and academics as well, but some may accept cosigners if you don’t meet their criteria.

How we rated Edly student loans

We compared Edly to six student loan lenders that specialize in no-cosigner student loans. Its editorial rating reflects how it compared to those six lenders.

We considered 26 factors, including repayment terms, fees, unique benefits, and more. In the end, we picked Edly as the best no-cosigner student loan for income-based repayment.

Edly FAQ

Does Edly offer private or federal student loans?

Edly offers private student loans with income-based repayment. It doesn’t offer federal student loans.

Does applying with Edly hurt my credit?

Prequalifying for an Edly student loan does not hurt your credit since it doesn’t perform a hard credit check as part of its prequalification process. Your credit is only affected if you choose to complete a full application for an Edly loan, at which time a hard credit pull is conducted.

Does Edly require a cosigner?

Edly does not require cosigners on its private student loans because payments are based on the borrower’s postgrad income, not their credit. For those who are denied for the non-cosigned product, or those who wish to apply with a cosigner, Edly does provide a cosigned product.

What can Edly student loans be used for?

You can only use funds from Edly student loans for qualified higher education expenses at approved schools. These include tuition, mandatory fees, and room and board. Edly pays the money to the school, so borrowers cannot use it for non-education purposes.

How long does it take to receive funds from Edly?

Edly disburses loan funds to the school three to five business days after receiving and processing all finalized documents and verifying enrollment for each semester. However, your school will ultimately decide when they would like to receive the funds.

As a result, it’s unlikely for borrowers to experience delayed access to their funds. The schools can then apply the funds to the student’s account to pay approved expenses.

Can Edly student loans be forgiven?

There are no loan forgiveness, cancellation, or discharge options for Edly private student loans. Borrowers are responsible for repaying the full amount borrowed plus any interest charges per the loan agreement.

Recap of our Edly student loans review

Student loan	Best for	Our rating
Income-based repayment loan	Income-based repayment	4.4/5	View Rates