LendKey is different from other student loan refinancing options NerdWallet reviews because it doesn’t directly lend. Instead, it’s a marketplace that helps borrowers compare student loan refinancing offers from more than 300 community banks and credit unions.
Borrowers with undergraduate or graduate student loans can refinance through lenders on the LendKey platform. Note that eligibility requirements and loan terms vary among the lenders that LendKey works with; the information we provide here is a range of what the various lenders offer.
» MORE: Banks vs. credit unions
AT A GLANCE
- Interest rates: 1.95% to 5.51% APR (variable) and 3.50% to 9.22% APR (fixed)
- Option to pay interest-only for the first four years
- Compare offers from more than 300 community lenders
With LendKey lenders, you can refinance $7,500 to $175,000 in student loans and choose a five-, 10- or 15-year loan term. As is common with student loan refinancing, most lenders on LendKey give a 0.25% interest rate discount to borrowers who sign up for automatic debit payments.
Keep in mind that not all the lenders on the platform will be options for every borrower. To join a credit union, you have to fit a specific borrower niche based on factors like where you live, your career or what other nonprofit organizations you belong to; to use a community bank, you typically have to live in the geographical area that bank serves. LendKey will help you narrow your search to find the ones for which you’re eligible.
Do you qualify?
| Minimum qualifications | The typical borrower | |
|---|---|---|
| Credit score | 660 | 728 |
| Income | $24,000 | $70,000 |
Reasons to use LendKey
Community lenders are consumer-friendly: If you appreciate personal attention and like supporting local businesses, LendKey might be a good option for you. Community banks, which are for-profit institutions, and credit unions, which are nonprofit organizations, are known for a friendly vibe, competitive interest rates and emphasis on customer service. For example, many on LendKey’s platform offer borrowers with 15-year terms the option to make interest-only payments for the first four years.
“I find (credit unions) to be probably the biggest hidden treasure when it comes to financial services for consumers,” says Vince Passione, LendKey chief executive officer.
A range of affordable financial products: Community banks and credit unions offer services that most student loan refinancing lenders don’t: checking and savings accounts, and auto, personal, and home loans. Plus, these local lenders offer competitively low interest rates because they’re typically committed to whatever best serves their borrowers. With one LendKey application, you’ll be able to compare interest rates across multiple banks and credit unions.
Where LendKey falls short
If you’re looking to refinance your student loans fast, LendKey may not be the choice for you. Once you’re matched with a community bank or credit union through LendKey, you’ll have to complete a full application with that lender. Traditional lenders often have longer application cycles compared to new, online lenders, who prioritize speed. Although it’s possible to close a loan through LendKey in two days, Passione says, it takes the average borrower 30 to 45 days.
Next steps
If you’re ready to use LendKey to compare student loan refinance offers from more than 300 community banks and credit unions, you can begin an application on the company’s website. If you get offers, you’ll have to complete your application through the individual bank or credit union, because LendKey isn’t a direct lender.
If you want to compare offers from up to six other lenders, including several new, online-only lenders, you can fill out an application through Credible, a student loan refinancing marketplace and NerdWallet partner. To get started, fill out the form below to see how much you could save by refinancing through Credible. (You can check out how the student loan refinancing calculator works here.)
» MORE: How to choose the best student loan refinancing offer for you
If you’re still unsure if refinancing is the right option for you, here’s more information to help you make a smart decision:
- 4 signs you’re ready to refinance federal student loans
- Student loan consolidation vs. refinancing
- 10 questions you should ask before refinancing your student loans
Teddy Nykiel is a staff writer at NerdWallet, a personal finance website. Email: Teddy@nerdwallet.com. Twitter: @teddynykiel.
This article was updated. It was originally posted July 22, 2015.
Image via iStock.
from NerdWallet
https://www.nerdwallet.com/blog/loans/student-loans/lendkey-student-loans-community-lenders/
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