Key Takeaways
Overview: The best student loan lenders include Earnest, Sallie Mae and SoFi. But several well-regarded lenders offer very similar products, so it’s critical to shop around. Some lenders excel at serving particular types of students or offer unique perks that may matter to you.
Editor’s take: Undergraduate students should always max out federal student loans before turning to private options, which tend to be more expensive and offer fewer protections. Parents with strong credit can often qualify for better terms in the private market than those available through federal Parent PLUS loans.
Methodology: Money reviewed loan products from 14 lenders, evaluating interest rates, fees, repayment terms, borrower protections and more.
Private student loans can help you fill in the funding gap after you’ve tallied all your scholarships and grants and maxed out federal student loans. Private student loans are credit based, meaning not every student or parent will qualify. In fact, nearly 90% of undergraduate private student loans have a cosigner since undergraduates are often too young to have an established credit history.
Our top picks for best student loans
The following companies are listed in alphabetical order.
Abe – Best for Borrower Protections
Ascent – Best for Borrowers Without a Cosigner
College Ave – Best for Parents
Earnest – Best for Flexible Repayment
MPower Financing – Best for International Students
Sallie Mae – Best for Non-Degree Programs
SoFi® – Best for Member Perks
Pros
In-school default protection
Grace period of up to 12 months
Several forbearance options
2% principal reduction after graduation
Cons
Lacks the history of more established lenders so customer reviews are limited
Lower lifetime borrowing maximums than other lenders
HIGHLIGHTS
Loan amounts
$1,000 up to total school-certified cost of attendance
Loan terms
5, 7, 10, 15 or 20 years
Fixed APR
2.65% – 16.36%
Minimum credit score
Not disclosed
Minimum income
Not disclosed
Abe, which launched in the summer of 2024, is a new lender in the private student loan space. Like many lenders, Abe allows borrowers to choose whether they want to make in-school payments or defer payments until they graduate. But Abe stands out for its in-school default protection. If a borrower chooses to start repaying while enrolled and ends up falling behind, Abe will automatically switch them to the deferred payment program.
Abe has an option to extend its 6-month grace period up to a full year, and a shorter-than-normal 12-month period to apply for cosigner release. The company also offers some of the most robust — and transparent — hardship protections of any lender. Borrowers can get 12 months of forbearance for a job loss or other financial hardship, natural disaster or illness.
Aside from the autopay rate discount, borrowers can reduce their interest rate by an additional 0.05% for every six months of on-time payments (for a maximum discount of 0.25%). Plus, borrowers can shave 2% off their principal after they graduate through Abe’s Grad Reward.
HIGHLIGHTS
Loan amounts
$2,001 to $200,000 lifetime maximum for undergraduate loans, $400,000 lifetime maximum for graduate loans.
Loan terms
Five terms for credit-based loans (5, 7, 10, 12 and 15 years) and two terms (10 and 15 years) for outcomes-based loans
Fixed APR
2.69% – 15.86%
Minimum credit score
Not disclosed
Minimum income
$30,000
Ascent is the best option for borrowers without a cosigner due to its specialized non-cosigned loan options for undergraduate, graduate and DACA students. It offers two options for non-cosigned loans — a credit-based option for those who do have a borrowing history and an Outcomes-Based Loan® for those without. These are unique products, but you should know that both options have significantly higher APRs than cosigned loans offered by Ascent (and other lenders). Credit-based loans without a cosigner start at 7.75% for fixed-rate loans; outcomes-based loans with a fixed rate start at 12.86%. Ascent does have a larger-than-normal discount for setting up autopay, with a 0.50% discount for all credit-based loans and a 1% discount for outcomes-based loans.
For borrowers with cosigners, Ascent offers competitive rates and a quicker 12-month period before you can apply for cosigner release. Other highlights include a 9-month grace period and loan products for career training and bootcamps.
Read full Ascent student loans review>>
Pros
Flexible repayment options for parents
Very competitive APRs for credit-worthy borrowers
Cons
Cosigner release only available after half the repayment term is completed
Late fee of up to $25 (several lenders have eliminated late fees)
Limited information about forbearance options or hardship protections online
HIGHLIGHTS
Loan amounts
$1,000 to total cost of attendance
Loan terms
5 to 15 years for most loans; up to 20 years for medical, dental and law school
Fixed APR
2.84% – 17.99%
Minimum credit score
Mid-600s
Minimum income
Not disclosed
Like most lenders, College Ave Student Loans offers a suite of undergraduate and graduate loans. But it also offers parent loans that have a customizable repayment term. Parents can choose a term anywhere between 5 and 15 years, which allows you to pick a term that best fits your budget. For borrowers with excellent credit and strong financial histories, College Ave may be a solid choice. The lender regularly offers some of the lowest starting APRs in the industry. But if you have fair credit, you may find better deals elsewhere. College Ave’s maximum APR is among the highest on the market.
Read full College Ave student loan review>>
Pros
Longer-than-normal grace period
Skip-a-payment program
Rate match guarantee
Cons
No cosigner release
Student must pursue a bachelor’s or graduate degree
HIGHLIGHTS
Loan amounts
$1,000 to total school-certified cost of attendance
Loan terms
5, 7, 10 or 15 years
Fixed APR
2.79% – 16.49%
Minimum credit score
650
Minimum income
$35,000
Earnest offers four in-school repayment options, four terms for all of its loans, and a longer-than-usual grace period. It has a unique skip-a-payment benefit, where borrowers have the option to skip one monthly payment a year without penalty, and it also boasts a rate match guarantee. Earnest doesn’t charge any fees, and among the lenders we reviewed, it had the highest customer review rating on Trustpilot, with a 4.6 (out of 5 stars) based on more than 7,500 borrower reviews.
Read full Earnest student Loans review>>
Earnest Disclosure
Earnest Disclosure
Actual rate and available repayment terms will vary based on your financial profile. Fixed annual percentage rates (APR) range from 3.14% to 16.74% (2.89% – 16.49% with auto pay discount). Variable annual percentage rates (APR) range from 5.24% to 17.10% (4.99% – 16.85% with auto pay discount). Earnest variable interest rate student loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once a month, but there is no limit on the amount that the rate could increase at one time. Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and requires selection of our shortest term offered, full principal and interest payment while in school, and enrollment in our .25% auto pay discount from a checking or savings account. Enrolling in autopay is not required as a condition for approval.
Earnest clients may skip a payment through a one, one-month forbearance during a 12 month period. Your first request to skip a pay can be made once you’ve made at least 6 months of consecutive on-time full principal and interest payments, and your loan is in good standing. The interest accrued during the skipped month will result in an increase in your remaining minimum payment. The final payoff date on your loan will be extended by the length of the skipped payment periods. Any unpaid accrued interest may capitalize (added to the principal balance) at the end of the forbearance period by adding unpaid accrued interest to the outstanding principal as permitted by law and the terms of the loan agreement.
Nine-month grace period is not available for borrowers who choose our Principal and Interest Repayment plan while in school.
Terms and conditions apply. To qualify for this Earnest Rate Match offer: 1) you must submit a completed student loan application; 2) you must provide documentation of an eligible competitive rate offer exclusive of all discounts by calling Client Happiness at (888) 601-2801 or chat on Earnest.com and follow the instructions to send in your proof of lower rate. Limit one rate match per application.
Earnest does not charge fees for late payment, prepayment, or loan origination. However, late payments may still be reported to credit bureaus and may affect your credit score.
Earnest Private Student Loans are made by One American Bank, Member FDIC, or FinWise Bank, Member FDIC. One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Finwise Bank, 756 East Winchester, Suite 100, Murray, UT 84107.
Earnest student loans are serviced by Earnest Operations LLC, 300 Frank H. Ogawa Plaza, Suite 340, Oakland 94612. NMLS #1204917, with support from Higher Education Loan Authority of the State of Missouri (MOHELA) (NMLS# 1442770) One American Bank, FinWise Bank, and Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by agencies of the United States of America. (C) 2025 Earnest LLC. All rights reserved.
Pros
Loans available to international students without a cosigner
Interest-only payments while in school
Cons
Higher-than-average rates and fees
Only one repayment option
Must attend a partner school
Not available to first- or second-year undergraduate students
HIGHLIGHTS
Loan amounts
$2,001 to $100,000
Loan terms
10 years
Fixed APR
10.89%
Minimum credit score
Not required
Minimum income
Not disclosed
Although some private student loan lenders will issue loans to international students, they typically require the student to have a cosigner that is a U.S. citizen or permanent resident. If the student doesn’t have close friends or family in the country, it can be difficult to find loans for school.
MPower is one of the only lenders that offers private student loans to international students without a cosigner or collateral. The lender offers visa prep courses and a job search tool for international students, and repaying these loans helps international students build a credit-history in the U.S. MPower works with 500 schools in the U.S. and Canada.
Pros
Offers career training, medical residency and bar exam loans
Cosigner release available after just 12 monthly payments
Cons
Limited repayment terms
Late fee of up to $25 (other lenders have eliminated this)
HIGHLIGHTS
Loan amounts
$1,000 to total school-certified cost of attendance
Loan terms
10 or 15 years
Fixed APR
2.89% – 17.49%
Minimum credit score
Not disclosed
Minimum income
Not disclosed
Like other lenders, Sallie Mae has education loan options for undergraduate, graduate, professional and medical school programs. But it’s also one of the few lenders that has options for students enrolled in trade or certificate programs. Within the professional programs, it offers loans designed specifically to help borrowers navigate periods where they’re not earning much, like during medical residency periods or when studying for the bar exam. Another unique feature: Borrowers who are enrolled in college less than half-time are still eligible to apply. (Many lenders are open to part-time students, but still require at least half-time enrollment.)
Most top lenders today offer at least three or four different terms for repayment; Sallie Mae only offers two for undergraduate loans and one for graduate school loans. But it does allow borrowers to sign up for a graduated repayment period, where they can make interest-only payments for up to a year after the grace period ends.
Read full Sallie Mae student loan review>>
Pros
No late or insufficient fund fees
Multiple rate discounts available
Extra member benefits
Cons
Not available for associate degree programs
Must make 24 months of payments before applying for cosigner release
HIGHLIGHTS
Loan amounts
$1,000 to total school-certified cost of attendance
Loan terms
5-year, 7-year, 10-year, and 15-year terms
Fixed APR
3.23% – 15.99% (with 0.25% autopay discount and 0.25% direct deposit discount))
Minimum credit score
Not disclosed
Minimum income
Not disclosed
For those looking for a private student loan without added fees, SoFi® is the top lender. Like most student loan lenders, it doesn’t charge origination fees. But SoFi also doesn’t charge any late fees. In addition to the standard discount for setting up automatic payments, existing borrowers can earn a returning scholar discount. It also offers a cash bonus for borrowers with Good Grades. And students and parents who borrow through SoFi have access to exclusive member benefits like financial coaching and estate planning, plus a rewards program where you can earn and redeem points for activities like checking your credit score and redeem them against your loan.
SoFi’s cosigner release policy — requiring 24 months of on-time payments before applying — is better than some lenders, but there are several lenders that offer shorter periods.
Read full SoFi student loans review>>
What you need to know about student loans
Student loans are issued by the federal government or private lenders to help students pay for undergraduate or graduate studies. The loan goes toward tuition, books, student housing and other education-related expenses.
Once a student loan application is approved, the funds are sent directly to the school to cover tuition, fees and on-campus student housing. Any remaining balance is then disbursed to the student.
All private loans accrue interest from when the loan is dispersed, while some federal loans don’t start accruing interest until you enter repayment. For private loans, in-school repayment options usually include deferment, interest-only or full payment, and repayment terms typically range from five to 20 years.
Federal vs. private student loans
Since private loans don’t offer the same protections that federal loans do, the general advice is to seek private student loans after you’ve exhausted every federal option.
Federal loans
Private loans
Credit Check
Not required for most loans
Required
Minimum income required
Not required
Required
Annual borrowing limits
Borrowing limits apply to most loans
Typically no annual limit
Payments while in schools
Payments deferred until student leaves school
Payments may be required
Eligible for loan forgiveness
Yes
No
Federal student loans
Federal student loans are the first choice for many due to their low rates, flexible repayment options and federal protections.
To apply for federal loans and additional financial aid, students must submit the Free Application for Federal Student Aid (FAFSA) once every school year. Your school will calculate how much you’re eligible to borrow based on the cost of attendance and your family’s financial information.
The federal government limits how much a student can borrow annually and over their lifetime based on the academic year, loan type and the borrowers’ dependency status.
Pros
Income-driven loan repayment plan options
Opportunities for student loan forgiveness
Low interest rates
Eligible for forbearance if experiencing a financial hardship
No credit checks for most loans
Cons
Disbursement fees apply
Only available to U.S. citizens and permanent residents with Social Security numbers
Strict annual and aggregate limits
Private student loans
Private student loans are similar to personal loans, as they are issued by private banks or credit unions.
Private student loan lenders look at students’ credit scores and credit reports to determine interest rates and loan approval. Since most students don’t have enough credit history, lenders often require a qualifying cosigner.
Private loans don’t feature the same benefits as federal student loans, but they can help pay your school’s total cost of attendance if you’re no longer eligible for federal aid.
Most private lenders suggest borrowers start loan repayment while still in school, but most offer in-school deferment or grace periods, although interest will continue to accrue.
Pros
Available to U.S. citizens and qualifying international students
No financial need requirements
Fixed and variable rates
Higher loan limits for undergraduate loans
Cons
Not eligible for federal forgiveness programs
Limited repayment options and hardship assistance programs
Requires credit check
May have higher APRs
Will likely require a cosigner
Student loan interest rates
Current private student loan interest rates range from just under 3% to 18%. The interest rate on your loans depends on the type of loans you have, your education level and the lender issuing the loan.
Rates can be fixed or variable. Fixed interest rates stay the same for the entire repayment period. By contrast, variable interest rates can change over time, so they are usually best for borrowers who want a shorter repayment term.
Average student loan interest rate
Federal student loans
Interest rates on federal student loans are established by federal law. The rates are fixed, so they stay the same for the duration of your loan term.
For federal student loans, we calculated the average interest rate using the rates for the current academic year. The overall average interest rate for federal student loans is 7.76%.
The rates you’ll pay depend on the loan and borrower type. These are the rates for loans issued for the 2025-2026 academic year
Undergraduate: 6.39%
Graduate: 7.94% for Direct Unsubsidized | 8.94% for Grad PLUS
Parent: 8.94%
Private student loans
Private student loans work differently. Lenders set their rate range based on an index, such as the Secured Overnight Financing Rate (SOFR). The rates can change over time as the market fluctuates, so you may find that current rates are higher or lower than when you took out your loan.
Other factors affect your private loan rates, including your credit history, income, debt-to-income ratio and whether you have a cosigner. Looking at the rate ranges advertised by 11 lenders, we calculated the averages: The average fixed rate is 8.76% and the average variable rate is 10.23%. Note that these are only illustrative. They aren’t reflective of the actual average rates offered by lenders.
How to apply for student loans
The following are general tips to consider before applying for student loans, whether federal or private.
Calculate your financial needs
Consider your school’s cost of attendance (tuition, materials, room and board, etc.) and then factor in additional living expenses. Money’s Best Colleges in America contains information about admission, costs, financial aid and graduation rates of hundreds of public and private institutions around the United States.
We recommend you consider federal loans first, as they have several advantages over private loans and a variety of options to choose from.
Shop around for private loans
If you need to take out a private student loan, keep in mind that each lender offers different terms, rates and benefits. They also have different underwriting models, so you may qualify for a lower rate with one lender even if they have a higher starting APR than competitors. That’s why you need to shop around and compare fees and APRs from multiple lenders before making a decision. A good place to start is a marketplace like Credible or LendKey, where you can review rates from several lenders at once.
Tip: Most federal student loans are available without a credit check, so they’re a good option for those with poor credit or no credit history.
Choose the right lender for you
To choose the best student loan, you should have a clear understanding of what each lender requires and what they offer regarding interest rates and repayment options:
Check your lender’s credentials: Only do business with reputable lenders. To determine this, use reputable sources like Federal Deposit Insurance Corporation (FDIC), Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB).
Apply for prequalification: By prequalifying, you get to see what rates, terms and benefits each lender offers, while avoiding a hard credit inquiry. Be sure to understand how different interest rates and terms affect your payments.
Look for lenders with in-school repayment options: Starting loan repayment early will reduce the debt burden. Opt for private lenders with multiple options, a grace period, and no penalties for early loan repayment.
Opt for lenders with low or no fees: Application and origination fees are processing costs added to your principal, which means you’ll pay interest on them. All federal loans have origination fees; private loans typically do not. Note that student loan companies are legally prohibited from charging prepayment penalties. If you can, look for lenders that don’t charge late fees either.
Take advantage of discounts and perks: Many lenders offer autopay discounts and other perks such as free study or tutoring programs and bonuses for good grades or referring friends.
Latest student loan news
The Education Department has started notifying borrowers on the Saving on a Valuable Education (SAVE) repayment plan that they’re time remaining in the plan is limited. Last week, the department started emailing borrowers telling them that beginning on July 1, they’d have 90 days to switch to another plan.
The SAVE plan, launched under former President Joe Biden, offered lower monthly payments and a faster forgiveness timeline for many borrowers. The plan has been in legal limbo for years now, and although Congress passed a law last year that sunsets the SAVE plan in 2028, the Trump administration wants to officially end it sooner.
For now, SAVE borrowers can stay where they are, but the clock is ticking. It’s a good idea to compare how your payments would change under other plans before you’re forced to switch so you have time to prepare your budget.
The latest upheaval surrounding SAVE comes as the federal student loan repayment system is undergoing broader changes. Borrowers who are already in repayment will continue to have access to existing plans. But students and parents who take out a new federal loan after July 1 will have access to only two repayment options: a new standard plan and the Repayment Assistance Plan (RAP).
Under the new standard plan, borrowers make equal monthly payments, with the repayment term determined by how much they borrowed. RAP is the new income-based option, with monthly payments ranging from 1% to 10% of a borrower’s adjusted gross income. (See more on both plans here.)
Best student loans FAQs
What is the interest rate on student loans?
The rate depends on the type of loans you have. For federal loans, the following fixed rates apply: Federal Direct Subsidized and Unsubsidized (for undergraduate students): 6.39%; Federal Direct Unsubsidized (for graduate students): 7.94% and PLUS Loans (for graduate students and parent borrowers): 8.94%.
With private loans, the rates can be fixed or variable. Fixed rates currently range from around 3% to 18%.
Do you need a cosigner for student loans?
Most federal loans are available without a cosigner, even if you don’t have good credit. For private student loans, students will usually need a cosigner with good credit — such as a parent or relative — to qualify for a loan.
Can you get student loans with bad credit?
If you have bad credit, federal loans are an excellent starting point. Most loans are available without credit checks, and the federal government doesn’t require a minimum credit score.
With private loans, qualifying for a loan may be more challenging. If you have poor credit, you’ll likely need a creditworthy cosigner to apply for a loan.
What is the best private student loan lender?
There is no singular best lender for all borrowers. The best lender for you will depend on your (or your co-signer’s) credit history and current finances, what type of degree-program you’re pursuing and how much you value different perks.
Best student loans methodology: How we picked our winners
We reviewed 14 private student loan lenders, evaluating them on more than 20 factors. We prioritized private lenders that offered the following:
Flexible repayment options
Federal student loans have several different standardized payment plan models, whereas private lenders often offer less flexibility. We looked for lenders that offered multiple in-school payment options. We compared the variety of repayment term lengths, favoring lenders with four or more term options, as the length of your term influences your interest rate and monthly payment, we believe that more options for a more customizable loan is valuable. We also considered whether lenders offered cosigner releases and how long a borrower had to wait before applying.
Competitive interest rates and low fees
We preferred lenders that balanced low starting rates for the most credit-worthy borrowers with still reasonable rates for borrowers with fair credit. In this case, we primarily looked for lenders with rates starting at or below 4% and maxing out around 15%, though we did make some exceptions.
Private student loan lenders rarely charge origination or application fees. But some do charge late fees or insufficient fund fees. We gave points to lenders that waived these.
Unique perks, discounts or specialized products
Lenders often specialize in products for specific programs or populations of students, or they offer unique perks and discounts. These helped us identify stand-out lenders that offered something beyond competitive rates and repayment terms.
Borrower protections
As an industry, private student loans lack the consumer protections offered via federal loans, so it’s critical for borrowers to understand their options to reduce or pause payments should they run into problems paying. Forbearance policies vary from lender to lender, and it can sometimes be hard to find clear information about them when shopping around. We favored lenders with transparent policies on their websites and options to defer payments for up to a year, at a minimum.
Summary of Money’s Best Student Loans of April 2026
Abe – Best for Borrower Protections
Ascent – Best for Borrowers Without a Cosigner
College Ave – Best for Parents
Earnest – Best for Flexible Repayment
MPower Financing – Best for International Students
Sallie Mae – Best for Non-Degree Programs
SoFi® – Best for Member Perks