Discover Student Loans Review
Discover offers student loans for both undergraduate and graduate students, as well as a loan to refinance and consolidate existing loans. Discover Student Loans have competitive rates, unique benefits, and may be a good choice for you depending on your situation.
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Key points:
- Discover offers student loans to both undergraduate and graduate students as well as student loan refinancing.
- Both cosigned and non-cosigned loans are available (if you qualify), but cosigner release is not an option.
In recent years, the skyrocketing cost of higher education has prompted more students to take out private student loans to help cover college expenses.
Discover Student Loans is one option among many when it comes to private student loans, but it offers competitive rates, terms, and benefits that borrowers will want to consider.
Below we’ll take a look at the interest rates, loan terms, and limits Discover Student Loans has to offer for undergraduate students, graduate students, and those looking to refinance existing student loans.
In this review:
- What types of loans does Discover offer?
- Discover in-school student loans
- Discover refinance & consolidation loans
- Compare Discover Student Loans to other options
What types of loans does Discover offer?
While most of us know Discover for its credit cards, Discover Student Loans is quietly one of the biggest private student loan lenders in the market.
Discover offers private student loan options for students in undergraduate, graduate, MBA, Law, Residency, Health Professions, and Bar Exam programs. It also offers refinance student loans. We’ll take a closer look at your options below.
Discover in-school student loans
What we like:
Cash rewards for good grades²
| Fixed APR | 5.49% – 12.99%3 |
| Variable APR | 4.12 – 11.87%3 |
| Loan Terms | 15 or 20 years |
| Loan Amounts | $1,000 to 100% of school-certified college costs1 |
Lowest rates shown include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments
| Discover Undergraduate Student Loan | Discover Graduate Student Loan | Discover Health Professions Student Loan | Discover Bar Exam Loan | |
| Loan amount | $1,000 – 100% of school-certified costs | $1,000 – 100% of school-certified costs | $1,000 – 100% of school-certified costs | $1,000 – $16,000 |
| Loan terms | 15 years | 20 years | 20 years | Up to 20 years |
| Fixed APR | 4.49% – 12.39% | 4.99% – 12.39% | 4.99% – 9.74% | 7.74% – 12.74% |
| Variable APR | 1.49% – 11.49% | 2.74% – 11.99% | 3.74% – 9.37% | 6.37% – 11.37% |
| Fees | Origination: $0 Prepayment: $0 Late payment: $0 | Origination: $0 Prepayment: $0 Late payment: $0 | Origination: $0 Prepayment: $0 Late payment: $0 | Monthly fee: $0 Origination: $0 Prepayment: $0 Late payment: $0 |
| Grace period | 6 months | 9 months | 9 months | 9 months |
Lowest rates shown include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments
Pros of Discover private student loans
- Discover may cover up to 100% of your school-certified costs. Aggregate loan limits apply.
- Discover’s undergraduate student loans have a repayment term of 15 years. This is longer than many lenders offer and borrowers have the option of paying off their loan early without any penalty. Graduate students get even more time to repay their loans.
- Discover borrowers won’t pay origination, application, late payment, or prepayment fees.
- Graduate students and those studying for the bar exam enjoy an extended grace period.
- You can qualify for an interest rate reduction by setting up automatic payments. You can also get a rate reduction if you sign up for interest-only payments.
- Borrowers can get a one-time cash reward on each new Discover undergraduate and graduate student loan if they get a 3.0 or better GPA (or equivalent) in any academic term covered by the loan. The reward redemption period is limited.
- Discover is known for it’s exceptional customer service and the company prides itself on having only U.S.-based Student Loan Specialists.
- Discover’s application is straightforward and can be completed completely online in 15 minutes or less.
Cons of Discover private student loans
- Qualifying for a Discover student loan may be difficult for borrowers who have a low credit score, low income, or no cosigner.
- Many student loan lenders allow borrowers to release cosigners from their loans after a certain amount of on-time payments have been made. Discover does not currently offer this option.
- Discover only makes approval decisions based on a hard credit check which will likely temporarily ding your score a few points.
- Borrowers won’t enjoy any of the borrower protections provided by federal student loans, such as the potential for student loan forgiveness. So, you should always exhaust your federal options before turning to private student loans.
Eligibility
Private student loans from Discover are offered to students enrolled at least half-time in an eligible, accredited college or university. You can see if your school is eligible during the application process.
How to apply
You can apply for a loan easily on Discover’s website. To apply, you’ll need to provide the following information:
- Social Security number (if applicable)
- School information, including field of study and academic period of enrollment
- Loan amount requested, as well as any financial aid you expect to receive
- Financial information, including income, monthly mortgage/rent payments (if applicable)
- Permanent address and temporary/in-school address
Additionally, if you’re applying with a cosigner, your cosigner will need to provide their:
- Social Security number
- Loan amount requested
- Employment information
- Financial information, including monthly mortgage/rent payments
- Permanent address
Discover will review that information and send you a letter accepting or denying your application. If you’re accepted, it will also detail your total allowable loan amount and the repayment stipulations set forth in your agreement.
Discover Student Loan repayment options
Discover student loans have three repayment options:
- Fixed payment plan, which requires a $25 loan payment while in school and during the grace period, then full principal and interest payments after school ends.
- Deferred payment option in which payments are not required until six months after the borrower leaves at least part-time attendance status or graduates. For graduate loans, payments are deferred until nine months.
- Interest-only repayment plan that allows borrowers to pay any interest charges as soon as the loan is funded, while they attend school.
Discover refinance & consolidation loans
What we like:
Zero fees
| Fixed APR | 5.74% – 8.49%5 |
| Variable APR | 4.62% – 7.62%5 |
| Loan Terms | 10 or 20 years |
| Loan Amounts | $5,000 – $150,000 |
Discover also offers consolidation or refinance student loans for qualified borrowers. You can refinance and consolidate both federal and private student loans together into one new private loan.
Refinancing can be a smart move for those looking to make only one payment on their student loans and for those looking save on their loans through a lower interest rate.
Borrowers are more likely to get approved after they have started working a full-time job, as they likely have established credit scores and a history of income and payments on other debt.
| Discover Refinance Student Loan | |
| Loan amount | $5,000 – $150,000 |
| Loan terms | 10 – 20 years |
| Fixed APR | 2.99% – 6.49% |
| Variable APR | 2.99% – 6.24% |
| Fees | Origination: $0 Prepayment: $0 Late payment: $0 |
Pros of Discover Refinance Student Loans
- Borrowers can extend their current loan repayment term up to 20 years.
- You’ll pay no origination, late payment, or prepayment penalties.
- You can consolidate all of your current federal and private loans into one, simple payment.
- You can qualify for an interest rate reduction by setting up automatic payments.
- Discover has a great reputation for excellent customer service.
- While not available with all private lenders, Discover offers forbearance and loan forgiveness in the event of the primary borrower’s death or permanent disability.
Cons of Discover Refinance Student Loans
- Refinancing federal student loans with a private lender forfeits your eligibility for the borrower protections federal loans enjoy, such as income-driven repayment plans and the potential for student loan forgiveness.
Repayment Options
Students can choose to refinance while still in school, during the grace period or after the grace period expires.
If you refinance while you are still in school or during your grace period, you will lose any remaining grace period on the loans, and you will begin making principal and interest payments according to your repayment term approximately 30 to 45 days after your loan is disbursed.
Eligibility
As with Discover’s private student loans, borrowers will need good credit for a refinance student loan.
You may be able to qualify with a lower credit score. However, the main benefit of refinancing is securing a more competitive interest rate, which may not be possible if aren’t able to demonstrate to Discover that you’ll keep up with payments on your new loan.
If you do have a poor credit score, you can check out our guide to student loans for bad credit to see some lenders that may be a better fit.
Applying for a Discover Refinance Student Loan
As with its private student loans, Discover allows you to easily apply on its website in a matter of minutes. You simply need to provide basic information about yourself, such as:
- your name, address, and birth date
- Your Social Security number
- Details about your current loans that you want to consolidate
- Your current status of employment and income
If you’re applying with a cosigner, they’ll need to provide the same information as well.
Alternatives to Discover’s college loan products
See what federal aid you qualify for
The first step to paying for college is seeing what kind of financial aid you are eligible for by submitting the Free Application for Federal Student Aid (FAFSA). It is free to file the FAFSA and the majority of students may qualify for some type of financial aid, including Pell Grants, work-study programs, and federal student loans.
Look for scholarships & grants
The next step is to look for scholarships and grants from nonprofits and other organizations. Organizations typically give scholarships and grants for academic merit, financial need, or outstanding performance in sports or an art.
Consider other private student loan & refinancing options
After you have exhausted all federal and state financial aid options, scholarships and grants, and college savings, the next step is to look for other private student loans.
You can compare Discover to other top lenders in our guide to the best student loan lenders. Or if you’d like to refinance an existing loan, check out our guide to student loan refinancing.
One lender in particular that you may want to consider for in-school loans is College Ave. College Ave is LendEDU’s top-rated student lender overall.
Discover Disclosures
- Aggregate loan limits apply.
- Students who get at least a 3.0 GPA (or equivalent) can get a one-time cash reward on each new Discover undergraduate and graduate student loan. Reward redemption period is limited. Please click here for any applicable reward terms and conditions.
- Lowest rates shown are for undergraduate loans and include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments. The interest rate ranges represent the lowest interest rate offered on the Discover undergraduate loan and highest interest rates offered on Discover student loans, including Undergraduate, Graduate, Health Professions, Law and MBA Loans. The fixed interest rate is set at the time of application and does not change during the life of the loan. The variable interest rate is calculated based on the 3-Month LIBOR index plus the applicable Margin percentage. The margin is based on your credit evaluation at the time of application and does not change. For variable interest rate loans, the 3-Month LIBOR is 2.00% as of January 1, 2020. Discover Student Loans will adjust the rate quarterly on each January 1, April 1, July 1 and October 1 (the “interest rate change date”), based on the 3-Month LIBOR Index, published in the Money Rates section of the Wall Street Journal 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125). This may cause the monthly payments to increase, the number of payments to increase or both. Please click here for more information about interest rates.
- View Auto Debit Reward terms and conditions.
- Get a variable interest rate from 3.99% APR to 7.24% APR (3-Month LIBOR + 1.99% to 3-Month LIBOR + 5.24%) for either a 10-year or 20-year repayment term. Or lock in a fixed interest rate from 3.99% APR to 6.99% APR for a 10-year repayment term or from 3.99% APR to 6.99% APR for a 20-year repayment term. The fixed interest rate is set at the time of application and does not change during the life of the loan. The variable interest rate is calculated based on the 3-Month LIBOR index plus the applicable margin percentage. The margin is based on your credit evaluation at the time of application and does not change. For variable interest rate loans, the 3-Month LIBOR is 2.00% as of January 1, 2020. Discover Student Loans may adjust the rate quarterly on each January 1, April 1, July 1 and October 1 (the “interest rate change date”), based on the 3-Month LIBOR Index, published in the Money Rates section of the Wall Street Journal 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125). This may cause the monthly payments to increase, the number of payments to increase or both. The lowest listed APRs include a 0.25% rate reduction for automatic payments. Visit discover.com/student-loans/consolidation for more information, including up-to-date interest rates and APRs.
- Lowest rates shown include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments. The interest rate ranges represent the lowest and highest interest rates offered on Discover student loans, including Graduate, Health Professions, Law and MBA Loans. The fixed interest rate is set at the time of application and does not change during the life of the loan. The variable interest rate is calculated based on the 3-Month LIBOR index plus the applicable Margin percentage. The margin is based on your credit evaluation at the time of application and does not change. For variable interest rate loans, the 3-Month LIBOR is 2.00% as of January 1, 2020. Discover Student Loans will adjust the rate quarterly on each January 1, April 1, July 1 and October 1 (the “interest rate change date”), based on the 3-Month LIBOR Index, published in the Money Rates section of the Wall Street Journal 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125). This may cause the monthly payments to increase, the number of payments to increase or both. Please click here for more information about interest rates.
View specific private student loan disclosures directly from Discover Student Loans here.
View other important Discover Student Loan disclosures here.
