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Yes, some credit unions offer student loans. However, your mileage may vary when it comes to your local credit union.
Student loans are niche loan products for credit unions Some of the largest credit unions offer both private student loans and student loan refinancing.
There are also organizations like CU Select that match prospective borrowers with credit unions that offer student loans. They work with a network of over 225 credit unions to help you find one that can offer you a student loan that meets your needs.
What are credit unions?
Credit unions are nonprofit financial cooperatives that provide banking services to their members.
Unlike commercial banks, which aim to maximize profits for shareholders, credit unions return excess revenue to their members in the form of lower fees, better interest rates, and more personalized customer service. Credit union members share a common bond: for example, they live in a particular geographic area, work for a particular employer, or belong to a particular organization.
Credit Union Private Student Loans
Private student loans should be the last resort for financing your studies. Still, many families take out student loans every year. Most families turn to traditional private student loan lenders like Sallie Mae.
However, credit unions may offer better interest rates and terms to borrowers.
For example, credit unions in the CU Select network currently offer interest rates as low as 3.99% for a fixed-rate loan. That's about 0.50% less than what we see from private banks and other lenders.
This is a compelling reason to include credit unions in your loan purchase.
Credit Union Student Loan Refinancing
Credit unions also offer student loan refinancing. Student loan refinancing is aimed at borrowers with existing student loans who may want to lower their interest rate.
In the past, more and more credit unions have been willing to offer student loan refinancing. Again, CU Select has a network of credit unions that will refinance your student loans. The best interest rates here are also around 1% lower than other private lenders.
People ask too
Do banks offer student loans?
Yes, banks offer student loans. Popular banks that offer student loans include Citizens Bank and ELFI.
Do credit unions make lending easier?
Not necessarily. Credit unions are known to be more flexible in their lending standards, but that doesn't mean the process is easier than at a bank.
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