Discover Student Loans

Discover bank has been a trusted financial institution for well over 95 years, and they offer a variety of financial products including savings accounts, personal loans, credit cards and student loans. They offer a number of financial aid options, such as federal Stafford loans for college and graduate school and federal parent PLUS loans. In addition to this they also offer certain certified private loans to supplement their range of federal student loans.

A student’s first course of action if they find that grants and scholarships are not enough to cover their costs of attending school is to look at the federal Stafford loan that Discover offer. Their Stafford loans are available to the vast majority of students, and typically no credit check is required. The Stafford loans also offer better interest rates than their PLUS loans and they have far more repayment options than their private loans.

For the current educational year federal Stafford loans can be obtained at a fixed interest rate of 4.5% for a subsidized loan and 6.8% for unsubsidized loans. There is a 1% fee for taking out this loan, although the payments are deferred, and therefore no payments are due until six months after a student graduates or if they are enrolled in school for less than half time. They have a standard 10 year repayment term for their Stafford loans although this can be extended up to 25 years.

Discover’s federal Stafford loans also have certain annual borrowing limits and these differ for both dependent and independent students. A dependent student is classified as someone who is under 24 years of age, is not married, and does not have dependents and they are not a veteran. An independent student will need to be at least 24 years of age, they are married, and they have dependents or are a dependent.

As mentioned, Discover also offer a federal parent PLUS loan, and this should be applied for if the federal Stafford loan is not enough to cover the student’s full cost of attending school. PLUS loans can enable parents to help finance 100% of their dependent child’s education and will be available whether or not there is a financial need.

The terms of a PLUS loan include it has a fixed interest rate of 7.9%, there is a fee which can be up to 4%, payments will generally begin within 60 days of the loan being disbursed, although there is an option to defer payment until six months after the student graduates or is enrolled for less than half time, and there is a standard 10 year repayment term, which once again can be extended up to 25 years.

In order to be eligible for a federal parent PLUS loan the applicant must be a parent, including the legal guardian of a dependent student who is enrolled at school at least half time, a parent who is a US citizen or eligible non-citizen, and a parent must also pass a credit check.

Discover also offer certified private loans which is a great option if money is still needed after considering a federal Stafford loan and a federal parent PLUS loan. These loans have a zero origination fee, extremely competitive rates of interest, and there is also a 2% graduation reward.

Discover’s private loans are offered at variable interest rates, there are no payments due until six months after a student graduates or are enrolled in school less than half time, and there is a 15 year repayment term. With a private loan a student is able to borrow up to their cost of attendance minus any other financial aid they have received.

In order to be eligible for a Discover private loan the student will need to be a US citizen or permanent resident, the student will need to be enrolled and making satisfactory academic progress in either a four or five-year undergraduate degree program, and the student will also need to pass a credit check or have a credit worthy co-signer depending on the outcome of the credit check.

Many people are unaware of the costs of a college education, and it is typically far more than just tuition fees that need to be covered. The cost of education will generally include tuition and fees, housing and living expenses, dorm room/apartment, utilities, food, academic courses, lab fees, books and supplies, textbooks, computers, school supplies, travel between home and school, and miscellaneous school expenses. Discover student loans are able to offer a number of viable funding options for students once have been allocated any grants or scholarships that they are due.