CordiaGrad started refinancing student loans in 2015 in partnership with Bank of Virginia. In March 2016, CordiaGrad struck out on its own; now it aims to combine the personalized feel of a community bank with the competitive interest rates of an established student loan refinancing player.
The requirements to refinance student loans with CordiaGrad are strict. But if you meet them, you can take advantage of benefits many other lenders don’t offer. You can choose an eight-year loan term, for instance — which is helpful if you’ve already been paying down your loans for a few years — and you can refinance your spouse’s loans with your own.
CordiaGrad is also one of a few lenders that lets parents transfer PLUS loans to their children through refinancing.
AT A GLANCE
- Interest rates: 3% to 4.95% (variable) and 3.95% to 6.75% (fixed).
- Interest rate discount of 0.25% for CordiaGrad checking account customers, plus standard 0.25% discount when you make payments by auto-debit.
- Must be at least 23 and have two years of work history to be eligible.
CordiaGrad serves customers who are on a solid financial footing. Borrowers must have worked full time for at least two years post-college to qualify, and most are able to refinance their loans without a co-signer, meaning they have strong income and credit history. In fact, only 11% of CordiaGrad’s customers have used co-signers on their applications, says founder and CEO Jack Zoeller.
Grads who choose CordiaGrad are in for a flexible, personalized refinancing experience. You can get an interest rate estimate without a credit check after answering just four questions on CordiaGrad’s sleek website. Once you apply, you’re assigned an individual loan advisor, who can answer questions about your application by phone, email and online chat.
“We reach out to you, and it’s totally up to you whether you as a user want to have help and how you want to have it,” Zoeller says.
CordiaGrad says it will work with borrowers on a case-by-case basis if they lose a job or have a financial hardship. There’s no specific time limit on the forbearance available.
Several lenders offer 12 months total of forbearance over the course of the loan; some, like U-fi and CommonBond, offer longer periods.
Do you qualify?
| Minimum qualifications |
The typical borrower |
|
|---|---|---|
| Credit score |
670 with a co-signer 700 without a co-signer |
770 |
| Income | $25,000 with a co-signer $42,000 without a co-signer |
$95,000 |
| Debt-to-income ratio | CordiaGrad prefers a borrower’s debt equal no more than 42% of his or her annual income. | 27% |
Reasons to use CordiaGrad
Couples can refinance together: Most refinancing lenders allow you to refinance only loans borrowed in your own name. That can make it tough for married couples, who may otherwise share finances, to bundle their student loans into one payment.
CordiaGrad is the rare lender that allows married couples to refinance their individual student loans into a single loan, with one spouse listed as a co-signer. The company will use the higher of the two spouses’ credit scores to determine their new interest rate.
Unique loan terms: CordiaGrad offers five-, eight- and 12-year repayment schedules, which are shorter than what many other lenders provide. The eight-year term in particular can be useful if you refinance two years after graduating and want to finish repaying your loans within the standard 10-year time frame.
“The eight-year is the most popular by far,” Zoeller says.
No matter what repayment schedule you choose, through CordiaGrad or another lender, you can always get rid of your loan sooner by paying more than the required monthly payment.
Where CordiaGrad falls short
High minimum balance requirement: CordiaGrad requires borrowers to have a current student loan balance of at least $20,000, one of the highest out there. That means potential customers with less student loan debt are out of luck, but they may qualify to refinance with other lenders that have lower minimums.
Next steps
You can estimate your likely interest rate on CordiaGrad’s Find My Rate app, then apply directly through the website. Alternatively, compare potential offers from CordiaGrad and other lenders through Credible, a refinancing marketplace that partners with NerdWallet.
Enter your information below to see how much you could save by using Credible. Note that the calculator assumes a 15-year loan term and the lowest currently available interest rate, which could be variable.
Brianna McGurran is a staff writer at NerdWallet. Email: bmcgurran@nerdwallet.com. Twitter: @briannamcscribe. Arielle O’Shea, a staff writer at NerdWallet, contributed.
This post was updated. It was originally published on Aug. 7, 2015.
Image via iStock.
from NerdWallet
https://www.nerdwallet.com/blog/loans/student-loans/cordiagrad-bringing-transparency-student-loan-refinancing/
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