Wells Fargo Student Loans

If you're scouring the web, looking for information to compare rates, you should know that the company with the lowest starting rate is not necessarily the one that will cost you the least money.

While Wells Fargo student loans have a higher higher starting interest rate than the ones offered by Sallie Mae, Wells Fargo sweetens the deal with a backend benefit:

• If you graduate, your interest rate will be lowered by .50%. (Other lenders also offer graduate incentives, of different kinds.)

When you add this to the .25% rate discount for automatic debit (which most lenders also offer) their rates are competitive. There is also another rate discount offered- a "relationship" discount. You may claim one of these if you (or your cosigner) meet the condition of having:

• a Wells Fargo pma Package- .50% discount
• a Wells Fargo deposit account- .25% discount
• a previous Wells Fargo student loan- .25% discount

This relationship discount can be stacked with the graduation and automatic debit discount (like when you buy a car) so that the total discount could be more than what you would get from Sallie Mae college loans or Discover school loans.

Your interest rate is based on the Prime Rate + a margin decided by your credit rating. (COMPENSATED AFFILIATE LINK: You can see your free credit score, here.) Wells Fargo student loans have a floor of 3.25%, so even if the Prime goes lower than that- your interest rate won't.

You will need a cosigner, because even if you have a good credit history, these are not federal student loans- there are income and employment qualifications too. (PNC bank offers details about this; most lenders do not.)

What sets Wells Fargo apart from the other large private loan lenders, is that they offer...

College Loans for Parents

• Rates will be lower (for excellent credit borrowers). They start at 3.5% APR, compared to federal rates of 7.9% fixed.
• Loan limits do not take other financial aid for the student into account. It is a 25,000 limit per year ($100,000 total). Federal parent college loans can only be taken out for amounts up to the cost of attendance minus other aid.
• Loans are disbursed directly to parents; federal loans go to the school.
• There are no fees for the Wells Fargo loan; federal loans charge a loan origination fee.
• Parent loans can be borrowed for students who are enrolled less than half-time; federal loans are only given to parents of students enrolled half-time or more.

Of course, there are disadvantages, too. Wells Fargo rates are variable, while federal rates are fixed. Right now, federal parent loans can be deferred until 6 months after graduation. Wells Fargo's repayment starts immediately, although arrangements can be made for loan interest payments only while the student is in school. The extended repayment plan for government school loans is not available for private parent loans. Neither is the graduated repayment plan. The term for a Wells Fargo parent loan is 15 years.

And, contrary to the comparison chart on their site, federal parent loans also offered a .25% interest rate reduction for automatic payment*.

*This has since been eliminated, but it was still there when ignored by the chart.



Wells Fargo Student loans
P.O. Box 5185
Sioux Falls, SD 57117-5185
Website
phone (service): 1-800-658-3567

Wells Fargo Student Loans- What Do You Think?

What do you think about their 'graduation benefit'? What about their parent loans for college- would a lower starting rate lure you away from the safe, fixed, federal rate?

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