Best private student loans in May 2021

As of

Private student loans are loans that help cover the costs of higher education and are best for borrowers who don't qualify for federal aid or need to borrow a large amount. Private student loans generally have fewer borrower protections than federal student loans, but their flexible repayment terms and choice of interest rates can be useful for borrowers looking to tinker with their monthly payment. Fixed private student loan interest rates currently range anywhere from 3.34 percent to 12.99 percent, and variable rates range from 1.04 percent to 11.98 percent.

We've rounded up the best private student loan offers so you can keep costs down while in school.

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The Bankrate guide to choosing the best private student loans

As of Saturday, May 08, 2021

Why trust Bankrate?

Bankrate wants to empower readers to make smart financial decisions. We’ve been comparing and surveying financial institutions for more than 40 years to help you find the right products for your situation. Our award-winning editorial team follows strict guidelines to ensure the content is not influenced by advertisers. Additionally, our content is thoroughly reported and vigorously edited to ensure accuracy.

When shopping for a student loan, look for a competitive interest rate, flexible repayment terms that meet your needs, generous hardship options and minimal fees. Loan details presented here are current as of the publish date. Check the lenders’ websites for more current information. The top lenders listed below are selected based on factors such as APR, loan amounts, fees, credit requirements and broad availability. To learn more about how we chose lenders, check out our methodology below.

Best private student loan interest rates in May 2021

Best For
Min. Credit Score
Min. Loan Amount
Max Loan Amount
College Ave
International students
Not specified
Variable: 1.04%–11.98% (with autopay); Fixed: 3.34%–12.99% (with autopay)
100% total cost of attendance ($150,000 for some degrees)
Payment flexibility
Not specified
Variable: 3.80%-9.36% (with autopay); Fixed: 3.74%–10.74% (with autopay)
Custom Choice
Graduation rewards
Not specified
Variable: 1.17%-9.38% (with autopay); Fixed: 4.14%–10.7% (with autopay)
$99,999 annually; $180,000 cumulative
Academic achievement bonus
Not specified
See rates above
100% total cost of attendance
Applying without a co-signer
Variable: Starting at 1.05% (with autopay); Fixed: Starting at 3.49% (with autopay)
100% total cost of attendance
Sallie Mae
Multiple loan options
Not specified
Variable: 1.13%-11.64% (with autopay); Fixed: 4.25%-12.59% (with autopay)
100% total cost of attendance
Online borrower resources
Not specified
Variable: 1.12%-11.89% (with autopay); Fixed: 4.13%-11.52% (with autopay)
100% total cost of attendance

Summary: What you need to know about private student loans

What is a private student loan and how does it work?

A private student loan is a loan used to cover qualifying educational expenses. You can take out private student loans through banks, online lenders and credit unions, and sometimes through colleges and state agencies. These usually have higher borrowing limits than federal student loans and may offer lower interest rates, but they come with fewer borrower protections.

To qualify, you’ll need to meet the lender’s eligibility requirements and go through a credit check. Applicants with good or excellent credit tend to get the lowest interest rates. But because undergraduates usually don’t have extensive credit histories, they typically need a co-signer to take out a private student loan.

Private student loans typically offer two types of interest rates: variable and fixed. With a fixed interest rate, the rate doesn’t change throughout the life of the loan. This is a good option for borrowers who prefer predictable payments, although the rates usually start a little higher. Variable rates, on the other hand, are tied to changes to an index, such as the Libor. These rates may go up or down over the course of repayment, although lenders usually limit how high the rate can go.

How does a private student loan differ from a federal student loan?

The main difference between private and federal student loans is where you get them. Federal student loans are funded by the federal government, while private student loans originate from private lenders, such as banks and credit unions.

Generally, you can borrow more with private student loans, and they come with flexible borrowing options and potentially lower interest rates depending on your creditworthiness.

However, the draw of federal student loans is that they come packed with important borrower protections, such as income-driven repayment options, generous forbearance and deferment programs and fixed interest rates.

If you need to borrow money to pay for college, start with federal loans. Then, if federal loans won’t cover all of your school costs or you’re not eligible to take out this type of loan, private student loans can fill in the gaps.

How has the coronavirus impacted private student loans?

The coronavirus pandemic has impacted nearly every corner of the U.S. economy, and its effects on private student loans have been a mixed bag:

  • Lower interest rates: Interest rates on student loans across the board have plummeted since the Federal Reserve cut rates to near-zero in 2020. Federal student loan rates set for the 2020–21 school year are at record lows, and private student loan companies have slashed their rates in response. As of early 2021, average private student loan interest rates range from around 1.5 percent to 13 percent. The rate you receive depends on the type of interest rate you choose, your creditworthiness and your degree program.
  • Paused principal and interest payments: Some private student loan lenders are offering forbearance programs to borrowers who are struggling with the effects of the pandemic. These programs allow you to temporarily suspend payments for a month or more. If you need help making payments, contact your loan servicer for details.
  • Closures and online classes: Some schools have closed or canceled classes, while others have moved entirely online. As a result, some schools are refunding money paid toward tuition and other school costs. Contact your school’s financial aid office for details. If you receive a refund, you could use the money to repay your loans.

The Biden administration's latest changes to private student loans

President Joe Biden’s administration says that it may be open to using an executive order to wipe out $10,000 of student loan debt per borrower, and Education Secretary Miguel Cardona is currently overseeing a review into Biden's authority to do so. However, the order would likely be limited to federal student loans, which means that borrowers with private student loans wouldn’t benefit from this move.

With that said, President Biden has proposed other student loan policies that could benefit private student loan borrowers, including:

  • Providing four years of free tuition at public universities for students with household incomes below $125,000.
  • Providing two years of free tuition at community colleges.
  • Providing two years of subsidized tuition at historically Black colleges and universities (HBCUs), tribal colleges and universities (TCUs) and minority-serving institutions (MSIs) for students with household incomes below $125,000.
  • Forgiving $10,000 of student loan debt for each year borrowers participate in national or community service, up to five years.
  • Making it easier to discharge student loan debt in bankruptcy.

Types of private student loans

Just about any type of student can apply for a private student loan, from undergraduates to students seeking medical, business, dental and law degrees. Some lenders also offer private student loans for international students or people who are in a residency program, studying abroad, attending community college, enrolled in a career-training school or studying for the bar exam. There are even student loans for borrowers with poor credit, although these loans might be more expensive.

Pros and cons of private student loans

Before applying for a private student loan, consider the benefits and drawbacks of this type of financing.


  • High borrowing limits: Private loans will often provide higher borrowing limits than federal loans, with some covering the full cost of enrollment.
  • Low interest rates: Borrowers with good credit could qualify for the lowest interest rates available.
  • Flexible enrollment requirements: Federal student loans require you to be enrolled for at least half time to qualify, but some private lenders offer loans for borrowers taking only a few classes or attending summer school.
  • Choice between fixed and variable rates: You can customize your repayment by choosing either a fixed interest rate or a variable interest rate.


  • No federal protections or benefits: Federal student loans come with benefits like defined forbearance, COVID-19 relief and income-driven repayment plans. Private lenders have fewer of these options available.
  • Average credit required: While most federal student loans don't check your credit, you will likely need a credit score in the mid-600s to qualify for a private student loan.
  • High rates for borrowers with poor credit: The lower your credit score, the higher your interest rates with private student loans. If you have a credit score near the lender's minimum requirement, your interest rate could be in the double digits.

Details: Private student loan rates in 2021

College Ave: Best for international students

Overview: College Ave offers private loans for students seeking undergraduate, graduate, dental, law, medical and business degrees. Parents can also take out loans on behalf of their college-bound kids, and students interested in attending community college or receiving career training may also apply.

Perks: International students can apply for a College Ave private student loan as long as they have a valid U.S. Social Security number and a creditworthy co-signer. Borrowers also have access to a lineup of online resources, including student loan calculators, scholarships, sweepstakes, contests and plenty of educational content.

What to watch out for: College Ave doesn’t disclose its income or credit requirements, meaning you’ll have to get a quote in order to determine if you’re eligible.

Lender College Ave
APR Variable: 1.04%–11.98% (with autopay); Fixed: 3.34%–12.99% (with autopay)
Loan amounts $1,000–100% total cost of attendance ($150,000 for some degrees)
Loan terms 5 to 20 years
Fees Late fee

CommonBond: Best for payment flexibility

Overview: CommonBond is an online lender that offers private loans for students pursuing undergraduate, graduate, business, dental and medical degrees. CommonBond boasts four different repayment options while you're in school: full deferment, a fixed monthly payment, interest-only payments or full monthly payments.

Perks: Borrowers can take advantage of generous hardship programs, such as personal forbearance for up to 12 months and natural disaster forbearance. Loan amounts start as low as $2,000, which is great for students who don’t need to borrow much.

What to watch out for: Borrowers usually need a creditworthy co-signer to apply, though you can release your co-signer from the loan after you make at least 24 consecutive, on-time payments.

Lender CommonBond
APR Variable: 3.8%–9.36% (with autopay); Fixed: 3.74%-10.74% (with autopay)
Loan amounts $2,000–$500,000
Loan terms 5 to 20 years
Fees Late fee: 5% or $10; Returned check fee: $5; Origination fee: 2% on dental school, medical school and MBA loans

Custom Choice: Best for graduation rewards

Overview: Custom Choice offers private student loans for undergraduate and graduate students. Although you don’t need a co-signer to apply, the lender says that you’re four times more likely to qualify when you add a creditworthy co-signer to the loan.

Perks: Borrowers who complete their degrees receive a graduation reward of 2 percent off the principal balance. The lender also offers generous hardship options: In the event of a job loss or natural disaster, borrowers can pause payments in increments of two months, up to a maximum of 12 months total.

What to watch out for: International borrowers aren’t eligible for Custom Choice products. Loans also aren’t available in Arizona, Iowa or Wisconsin.

Lender Custom Choice
APR Variable: 1.17%–9.38% (with autopay); Fixed: 4.14%-10.7% (with autopay)
Loan amounts $1,000–$99,999 annually ($180,000 cumulative)
Loan terms 7 to 15 years
Fees None

Discover: Best for academic achievement bonus

Overview: Discover offers private student loans to students seeking undergraduate, graduate, medical, dental, business and law degrees. You can also apply for a loan if you’re in a residency program or studying for the bar exam.

Perks: In addition to its long menu of student loans, Discover’s standout feature is the academic achievement bonus. Borrowers are eligible for a 1 percent cash reward if they maintain at least a 3.0 GPA.

What to watch out for: Discover limits its loan terms to either 15 years or 20 years depending on the type of loan. There’s also no prequalification option and no co-signer release.

Lender Discover
APR See rates above
Loan amounts $1,000–100% total cost of attendance
Loan terms 15 or 20 years
Fees No fees

Earnest: Best for applying without a co-signer

Overview: Earnest offers private student loans for students seeking undergraduate, graduate, business, law and medical degrees. Borrowers may qualify on their own or use a co-signer.

Perks: Borrowers can choose from four main repayment plans, access forbearance and deferment programs and even skip a payment once a year if needed. Also, borrowers aren’t required to get a co-signer on the loan (though it’s an option if you want to score a lower interest rate).

What to watch out for: If you have a co-signer, there’s no option to release them from the loan. Plus, Nevada residents can’t take out any of Earnest’s student loans.

Lender Earnest
APR Variable: Starting at 1.05% (with autopay); Fixed: Starting at 3.49% (with autopay)
Loan amounts $1,000–100% total cost of attendance
Loan terms Not specified
Fees Florida documentary stamp tax: $0.35 for each $100

Sallie Mae: Best for multiple loan options

Overview: Of all the lenders on this list, Sallie Mae offers the most extensive menu of private student loan options. There are loans for students seeking undergraduate, graduate, medical, dental and law degrees, plus career-training loans, parent loans and even loans for students who pay tuition for K–12 school.

Perks: Sallie Mae supports students through free study help and college expense calculators, and borrowers can take out loans even if they’re enrolled less than half time, attending online or summer classes, studying abroad or enrolled in professional certification courses.

What to watch out for: If you need to apply for hardship programs, Sallie Mae offers fewer options and shorter forbearance periods than others on this list.

Lender Sallie Mae
APR Variable: 1.13%–11.64% (with autopay); Fixed: 4.25%–12.59% (with autopay)
Loan amounts $1,000–100% total cost of attendance
Loan terms 5 to 20 years
Fees Late fee: 5% or $25; Returned check fee: Up to $20

SoFi: Best for online borrower resources

Overview: SoFi offers private student loans, law school loans, medical school loans, MBA loans and parent loans, plus other financial products such as personal loans and mortgages.

Perks: With SoFi’s unemployment protection program, a professional can help you search for jobs and provide one-on-one career training. And unlike many other student loan lenders, SoFi has an app where you can browse deals, use financial planning tools and find educational resources.

What to watch out for: SoFi’s minimum loan amounts are higher than those of any other lender on this list, which might not be a good fit for people who only need to borrow a small amount.

Lender SoFi
APR Variable: 1.12%–11.89% (with autopay); Fixed: 4.13%–11.52% (with autopay)
Loan amounts $5,000–100% total cost of attendance
Loan terms 5 to 15 years
Fees None

How to find the best private student loan rates

When it comes to getting the best student loan rates, it pays to do some research upfront. Here's where to start:

  • Compare multiple lenders. Look at interest rates, fees and repayment plans from a few lenders to see which might be best for your needs. You may want to start with your current bank, but online lenders could offer lower rates. Also look through any unique features, like relationship discounts or cash rewards at graduation.
  • Check eligibility requirements. Every lender has its own qualification requirements. You might need to meet a minimum income or credit score threshold to qualify, and you might have to be enrolled in school at least half time at an eligible program. Many lenders also list the credit requirements needed for the best rates advertised.
  • Get prequalified. Many lenders let you avoid unnecessary hard credit checks by offering prequalification, which allows you to see if you qualify — and, if so, what your interest rate will look like. If you prequalify with multiple lenders, you can make an apples-to-apples comparison with only a soft credit check.

Frequently asked questions about private student loans

Can I get a private student loan with bad credit?

If you have bad credit, it’s best to start by applying for federal student loans. These don’t require a credit check in most cases. If you still need to apply for private student loans to fill in some of the gaps but you lack strong credit, then you may need a co-signer to qualify. A co-signer agrees to foot the bill if you fall behind on payments, so make sure they understand what they’re getting into before they sign up.

Will I need a co-signer for a private student loan?

Students are nearly four times more likely to be approved with a co-signer, according to private lender Sallie Mae. That’s because private student loans are largely based on creditworthiness, and a co-signer can help you qualify for the loan and get better loan terms if you're young and have little credit history.

How do I qualify for a private student loan?

Every lender has its own way of setting eligibility requirements and calculating loan terms, but here are three areas where they usually focus:

  • Good credit score: Private student loans are based largely on credit requirements, so having a higher score increases the likelihood that you’ll qualify and get more affordable loan terms.
  • Income requirements: Lenders also might check that you have the income to handle monthly payments. College students who don’t have a job or don’t earn enough to meet these requirements might need to add a co-signer to qualify.
  • Enrollment requirements: Many lenders require borrowers to be enrolled in school at least half time in an eligible program to take out a private student loan. If you’re not sure that you fit requirements, contact your lender and ask.

Do private student loans allow deferment or forbearance?

Many lenders offer deferment and forbearance programs, although they vary by loan type and servicer. And keep in mind: While you’re not making payments, your student loans usually accrue interest. Here’s how the two types of relief work:

  • Student loan deferment: If your loans are in deferment, you won’t have to make payments during specific windows, such as while you’re enrolled in school. You won’t pay a penalty for missing a payment during these time frames, and it won’t affect your credit.
  • Student loan forbearance: If you’re financially struggling, you might be able to enroll in a forbearance program. These allow you to temporarily pause payments while you’re unemployed, ill, affected by a natural disaster or going through another type of financial hardship.

What can private student loans be used for?

While requirements vary by lender, private student loans can often be used for education expenses and sometimes for living expenses. These may include:

  • Tuition.
  • Room and board.
  • Fees.
  • Books.
  • Supplies.
  • Transportation.
  • Computer for school.


To find the best private student loan lenders, Bankrate first searched for lenders that are reputable and widely available. It was also important to find lenders with relatively low starting interest rates.

To narrow down the field, we then compared repayment terms, number of loan types and eligibility requirements to determine which lenders would cater to a variety of borrowers. For our top picks, we selected companies that not only make private student loans affordable, but also offer a variety of unique features for borrowers with specific needs.