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NASA Federal Credit Union, headquartered in Maryland, is a national financial institution offering a variety of products and services to its field of membership.
The credit union was founded in 1949, and since that time has grown to serve more than 140,000 around the country. There are ten full-service branch locations around the DC-metro area, but the credit union utilizes a shared network of co-op branches to extend its reach to members.
Additionally, NASA FCU also offers a large network of fee-free ATMs. NASA FCU offers a robust online banking platform, personal lending, mortgage and auto loans, credit cards, checking and savings accounts, and a unique student loan product—the Student Choice Loan.
College students or future students who will be earning a degree may qualify for NASA Federal Credit Union’s Student Choice Loan financing line of credit. Instead of a traditional fixed-term loan, NASA FCU provides flexible access to student loan funding to borrowers with no origination fees, deferred monthly payments, and competitive interest rates.
How Does the Line of Credit Work?
The Student Choice Loan from NASA Federal Credit Union is not a loan but a line of credit extended to qualified borrowers. Instead of applying for a single loan per academic year or semester, students using NASA FCU can establish a line of credit that offers additional funding for future terms.
The amount available for the initial line of credit is based on the total cost of attendance for the school the student is attending or plans to attend, similar to other education loans. The borrowed amount is equivalent to one year, but students can make additional draws on the line of credit for upcoming terms. This allows for more flexibility than traditional fixed-term student loans including federal loans.
Rates & Terms of the Student Choice Loan from NASA FCU
The Student Choice Loan from NASA FCU has an interest rate as low as 6%, which is comparable to other fixed-rate student loan lenders offering private financing. Students can defer payment on the line of credit so long as they are attending school at least half-time.
The repayment term is either 20 or 25 years, depending on the total amount of the line of credit once the student leaves school. The maximum line of credit amount cannot exceed the remaining cost of attendance, less any other financial aid received by the student.
>> Read More: Credit Union Student Loan Options
Eligibility & Applying
Students may apply for the NASA FCU Student Choice line of credit so long as they are enrolled in or currently attending one of more than 2,000 approved schools throughout the United States. Borrowers need to be at least 18 years old, a US citizen or permanent resident and have a strong credit score to qualify for the financing. If a student does not yet have established credit or their credit is bad, a co-signer may be included on an application to strengthen the chance for approval.
>> Read More: Student Loans for Bad Credit
When a co-signer is added, the student borrower listed as the primary applicant on the loan may qualify for a higher loan amount or a better interest rate. However, a co-signer is not required for the Student Choice loan from NASA FCU.
All students who use the NASA FCU Student Choice line of credit to finance their education have a deferred repayment schedule. This means that there are no payments due on the line of credit while the student is still in school. Once the deferment period ends, repayment extends either 20 or 25 years.
There are no pre-payment penalties if students want to make payments on the line of credit balance during the deferment period, or a larger amount than the minimum due on the loan once repayment begins.
Pros & Cons of NASA FCU Student Loans
The Student Choice line of credit from NASA FCU offers several benefits to borrowers compared to other financing options, including the following:
- A fixed, competitive annual percentage rate
- No need to reapply for new funding for additional school terms
- A simple application submitted online
- The ability to add a co-signer if needed
However, there are also caveats of which borrowers must be aware. Many of these are true of other private loans as well These include:
- A co-signer release can take a long time to be available
- Not all borrowers will qualify based on credit history and score without a co-signer
- The long repayment period of 20 or 25 years may result in paying more interest over the life of the loan than a shorter repayment period
- The primary borrower must also be a credit union member before starting the application process
The Student Choice Loan program from NASA Federal Credit Union is a unique student loan option for borrowers.
Instead of having to reapply each year for funding, the line of credit works as a flexible, ongoing financing tool that is both easy to apply for and easy to use. Student borrowers enjoy a fixed interest rate that is competitive with other private student loan lenders, and a co-signer may be added to help strengthen an application.
However, borrowers must meet the membership requirements of the credit union to qualify, and without a co-signer, they may not be eligible based on personal credit history.
There may be other student loan solutions that offer less stringent qualification requirements or better interest rates than NASA FCU. As always, it is important to comparison shop for private student loans to ensure the financing is the best fit for your financial circumstances, both now and in the future.
>> Read More: List of student loan companies
Author: Jeff Gitlen