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October 21, 2020
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College Ave Student Loans Review

College Ave offers a full range of student loan types for both graduate and undergraduate students, including fixed rate and variable rate loans, as well as student loan refinancing. What makes College Ave stand out is its multiple loan term and repayment options, plus its variety of educational tools. However, the service does have room for improvement. College Ave has a longer than usual repayment period before a borrower can request a co-signer release. Additionally, their refinance options aren’t that great for co-signers and parents. The lender could also be more forthcoming about credit requirements, as it doesn’t advertise a required minimum credit score.

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PROS

Multiple repayment options. You’ll have 4 different repayment options with College Ave: pay full interest and principal right away; pay interest only while in school; make a flat monthly payment; or full deferment of payments until after you graduate. Most other student loan lenders will have only two repayment options.

Term length flexibility. You can also choose the length of your loan term, which means you can save on interest by choosing a shorter repayment schedule instead of being locked into a term chosen by the lender. When deciding what loan term you want, you need to evaluate how much you can afford to pay monthly. Once you choose a term, you can’t change it unless you refinance. If you choose a shorter term you’ll have a higher monthly payment but pay less in interest. A longer term means lower monthly payments, but more interest over the long run.

Loan prequalification. College Ave will do an initial soft credit check to give you an idea of how much and what interest rate you’ll qualify for before you actually submit an application.

Educational resources. If it’s the first time you’re applying for a student loan and are unsure of the process or what type of loan or interest best fits your needs, College Ave has a number of helpful articles that explain the ins and outs of student loans, when it makes sense to refinance, and what the difference is between an interest rate and APR, among other topics..

Rewards programs. The Success Rewards program is a benefit of the Career student loan where eligible borrowers can qualify for a $150 statement credit applied to the loan principal. College Ave also partners with the Payce Rewards network, where you can get cash back on purchases at over 61,000 participating stores. The cash back is used to pay down your loan.

CONS

Long cosigner release. College Ave has great customer reviews and offers a wide variety of loans. However, if you needed a co-signer in order to initially qualify for a loan and are interested in removing that co-signer early in your repayment period, College Ave may not be for you. By obtaining this release, your co-signer is no longer responsible for paying the loan if you fail to do so. It also frees up their credit, improving your co-signers chances of getting approved for a personal or other type of loan, or being a co-signer for someone else.

College Ave requires that you make more than half the total number of payments on your loan before you can request a waiver to release your co-signer. That means that if the term of your loan is 10 years, you will have to make five years of repayments before you can release your co-signer. Most student loan providers require only 24 to 36 consecutive on time payments be made before allowing a co-signer to be released.

Refinance restrictions. If your parents took out a loan and you’re interested in refinancing the loan in your name, you can’t with College Ave. You’ll need to find a different lender. Parent loans are also not discharged in case of the parent’s death – the estate will still be responsible for the loan. Also, if you refinanced your loan with a co-signer, that person will be responsible for the loan for the duration – you can’t release your co-signer.

College Ave Key Facts

General Details
Private student loans for graduate and undergraduate programs
Free pre-qualification tool to help you determine if you qualify for a loan and the amount you’ll qualify for
Can borrow from $1,000 up to a maximum of $150,000
Can borrow up to 100% of your cost of attendance
Application is done online and takes a matter of minutes
No application fees
Once approved, you can typically expect disbursement in 10-14 days
Types of Loans Offered
Graduate Student Loans: Loans to help you pursue a postgraduate, masters, or doctoral degree. College Ave also provides loans that cover up to 100% of the cost for professional degrees in MBA/Business School, Medical School, Dental School, and Law School
Parent Loans: Choose to receive up to $2,500 of the loan directly in order to cover expenses such as books, electronics, or other dorm/school related supplies.
Career Loans with Success Rewards: Covers 100% of the cost of attendance for associate, bachelor, and graduate programs at select colleges and universities. Complete your program of study and receive $150 cash back as a statement credit on your loan principal.
Refinance Loans: Refinance loan amounts as low as $5,000. The maximum amount that can be refinanced is $150,000 for all undergraduate and graduate degrees and $300,000 for those with medical, dental, veterinary, or pharmacy doctorate degrees.

College Ave Company Information

College Ave was founded in 2014 by former Sallie Mae executives as an online lender exclusively dedicated to providing private student loan options for graduates and undergraduates, as well as refinancing loans and loans for career degrees.

Since its inception, the lender has raised over $125 million in funding and provided over $60 million in student loans and refinances. The lender currently employs 66 people and is headquartered in Wilmington, Delaware.

College Ave Private Student Loans and Student Loan Refinancing

College Ave provides the full range of student and parent loans as well as refinance loans for prospective graduate and undergraduate students. While the lender doesn’t specify a minimum credit score to qualify, the website states it uses a proprietary method of evaluating prospective borrowers to determine if they are creditworthy. Information that can affect your qualification includes your debt-to-income ratio, your income, and your financial obligations.

If you’re not sure whether you’ll qualify for a loan or not, College Ave has a free pre-qualification tool that will help you determine what rate and term you qualify for without a hard credit history check. This way, if you don’t meet College Ave requirements, your credit score won’t be affected. The lender doesn’t require a co-signer, but says that most of its borrowers (98%) use a co-signer to qualify for a loan.

Applying for a loan with College Ave can easily be done online, and you’ll find out if you’re approved in 3 minutes. Once you have accepted the terms, the loan is sent to the school for certification. Funding the loan typically takes about 10 days, although it could take longer, depending on the school certification.

You can choose from fixed or adjustable interest rates. If you’re unsure which type of interest rate is your best option, you can find an in-depth discussion of student loans at Money’s Best Student Loans of 2020.

You don’t need to be a full time student to get a loan with College Ave, but you do need to be enrolled in a degree program at an eligible school and attend classes full time, half-time, or less than half time.

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College Ave Repayment and Loan Term Options

With College Ave you’ll have options, both in how to repay your loan as well as how long you’ll be paying the loan back. It’s what makes the lender stand out from other private student loan providers.

College Ave has four different repayment options, each with its own pros and cons:

  • Start paying full principal and interest as soon as you receive your first loan statement. This option offers the lowest overall cost over the life of the loan. However, you’ll be responsible for a high monthly payment while still in school.
  • Pay interest only. You’ll have moderate monthly payment while still in school, reducing interest but not loan principal.
  • Make a flat payment of $25 a month. This payment goes to reducing your accumulated interest and offers the lowest in-school payment option.
  • Defer your payment until after you graduate. You won’t need to make any payments while you’re in school but will pay more in interest over the life of the loan. You can defer payment while you are enrolled at least half time in school, and payments won’t begin until six months after either graduating or dropping below half-time enrollment. For medical school graduates, payments can be deferred up to 36 months after leaving school.

You should note that there are slightly different repayment options for parents taking out a loan for their child. The interest only and interest/full principal payment options are the same, but there is a third option called interest plus payment. If you choose this, as long as you satisfy the monthly interest payment you can pay whatever else you desire on top. Keep in mind that parent loans cannot be deferred; repayments must start upon receiving the first loan statement.

Most private student loan servicers will have fixed, standard loan terms. With College Ave, you can select a shorter loan term and save on interest payments over the life of the loan or a longer term to make your payments more financially accessible. You get to choose whichever term is the most convenient for you.

For undergraduate and parent loans, you can opt for any repayment term of between 5 and 15 years, whereas refinance loans and medical, dental and law school students can choose a loan repayment term of anywhere between 5 and 20 years.

College Ave Fees and Interest Rates

College Ave doesn’t charge any application or loan origination fees. There are also no prepayment fees if you decide to pay your loan off early. The only fee College Ave does charge is a late fee of 5% of the unpaid monthly payment amount or $25, whichever is lower. A payment is considered late if it is not paid within 15 days of the due date.

Interest rates will vary depending on the purpose of the loan (graduate, undergraduate, etc) and whether you choose a fixed or adjustable rate mortgage. Your specific interest rate will be determined by your credit score and other financial information as well as the information provided by your co-signer if you have one. You can get a 0.25% discount on your interest rate if you sign up for auto-pay.

As of October 15, College Ave is offering loans with the following interest rates (including the auto-pay discount):

 

Source: collegeavestudentloans.com

 

Private Student Loans vs. Federal Student Loans

Whenever you consider taking out a student loan, you should always check out federal loans first, as they offer a few advantages over private loans. They don’t take credit scores or income into account, and nearly everyone who is enrolled in an eligible school and is in good academic standing will qualify.

Other advantages include flexible repayment plans, including plans that are tied to your income or based on your earnings. In most cases, any outstanding loan balance that remains unpaid after 20 or 25 year is forgiven.

Perhaps the biggest advantage of federal loans is the interest rate. Federal loan rates are set once a year, on July 1, and don’t change for the academic year ahead, so you don’t have to worry about figuring out which is the best interest rate. Federal loans also have lower interest rates than private loans. Learn more about federal student pans and how to apply here.

Federal Loan Interest Rates for the 2020-2021 academic year:

  • Undergraduate Direct Subsidized and Unsubsidized loans – 2.75%
  • Graduate or Professional Unsubsidized loans – 4.3%
  • Direct PLUS loans – 5.3%

There are some drawbacks to federal loans, however. Loans amounts range from $5,500 to a maximum of $12,500. If you need more than that to pay for school, you’ll need to take out a loan with a private lender. Federal loans must be repaid in 10 years, while private loans offer longer terms. However, the advantages of federal loans still make them the first choice when applying for financial aid.

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College Ave FAQs

What do I need to qualify for a student loan with College Ave?

College Ave assesses eligibility on an individual basis. Some of the factors it will consider are credit score, income, and debt-to-income ratio, among other things. About 98% of student loans require a co-signer, so you will need to consider who could be the best option to co-sign the loan. You can verify if you’re eligible for a loan by using College Ave’s pre-qualification tool.

Are there prepayment penalties with College Ave?

No, College Ave does not charge a prepayment penalty. On the contrary, the lender encourages borrowers to make additional payments if possible to save on interest and shorten the term of the loan.

What kind of loans does College Ave provide?

College Ave specializes in private student loans. It offers undergraduate, graduate, and parent loans, as well as career loans for associate degrees.

Do I have to start repaying my student loan immediately?

No. With College Ave, you have four repayment options to choose from. You can defer starting payments until six months after leaving school (36 months if you’re in medical school). Other options include paying full interest and principal immediately, opt for paying interest only while still in school, or pay $25 per month until you graduate.

Can a student loan pay for all my school costs?

Yes. College Ave loans can cover up to 100% of your school attendance costs if you qualify. Loan amounts begin at $1,000 and go up to a maximum of $150,000 ($300,000 for medical, dental, veterinary, or pharmacy schools).

Do I need to be enrolled full time to qualify for a loan?

No. With College Ave all you need is to be enrolled in a qualified school and be attending full-time, half-time, or less than half-time.

Does College Ave offer federal student loans?

No, College Ave only offers private student loans. You can refinance federal loans with College Ave, however.

College Ave Student Loans – Key Takeaways

  • Full array of private student loans
  • Flexible loan repayment options let you choose when you start to pay your loan
  • Flexible loan terms allow you to choose the length of your loan
  • Loan amounts as low as $1,000 and as high as $150,000 ($300,000 for Medical school)
  • Student loan refinancing options
  • Easy online application process
  • No application or origination fees
  • No prepayment penalties.
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