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Courtesy of Discover

In addition to its well-known credit card products, Discover offers a range of competitive private student loan options. Low rates, no fees and rewards for maintaining good grades make Discover’s student loans worth consideration.

Discover is an online lender that offers private student loans and loan consolidation to borrowers throughout the nation. It covers up to 100 percent of school-certified college and graduate school costs.

One standout feature of this lender is that it offers 1 percent cash-back of the loan amount to borrowers who maintain a 3.0 GPA (or equivalent). That’s a bonus for any student wishing to get cash in return for good grades.

Discover student loan snapshot

Loan types
Undergraduate, graduate, MBA, health professions, residency, law, bar exam and consolidation
Loan amounts
Up to 100% of school-certified cost of attendance
Interest rates
Variable: 3.12% to 11.62% APR
Fixed: 4.74% to 12.49% APR
Lowest rates shown are for the undergraduate loan and include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments.
Repayment terms
Undergraduate: 15 years after the deferment period ends
Consolidation: 10-year and 20-year periods
All other loans: 20 years after the deferment period ends
Grace period
6 to 9 months
Co-signer required?
No

Get pre-qualified

Answer a few questions to see which personal loans you pre-qualify for. The process is quick and easy, and it will not impact your credit score.

Who can take out a Discover student loan/who is it good for?

Discover student loans are a solid option for those who have maximized grants, scholarships and other free financial aid and want a lender that offers a number of loan types and a loan consolidation option. It’s also a good choice for those interested in earning cash-back rewards for maintaining good grades.

Qualification requirements for a student loan from Discover vary by loan type.

For undergraduate and private student loans, you must be:

  • Enrolled at least half-time and seeking a degree at an eligible school
  • A U.S. citizen, permanent resident or international student
  • 16 or older when you apply
  • Making satisfactory academic progress, according to your school
  • Pass a credit check

For consolidation student loans, you must be:

  • 18 or older at the time you apply
  • A U.S. citizen or permanent resident
  • Pass a credit check
  • Have no more than $150,000 in aggregate student loan debt
  • Have verifiable income and be the primary borrower on the loans

For bar exam loans, you must be:

  • A graduate from law school within the past six months, or be enrolled in your final year of study in a graduate law degree program
  • A U.S. citizen, permanent resident or international student
  • Be 16 or older at the time you apply
  • Pass a credit check

For residency loans, you must be:

  • A graduate from medical school within the past 12 months or be enrolled in your final year of study in a graduate health professions program
  • A U.S. citizen, permanent resident or international student
  • Be 16 or older at the time you apply
  • Pass a credit check

Interest rates and terms

Discover offers both variable and fixed-rate options across its student loan products. Although interest rates vary by loan product, they are fairly consistent across the board, with variable rates ranging from 3.37 percent to 11.87 percent and fixed rates ranging from 4.74 percent to 12.99 percent. The interest rate you receive varies based on creditworthiness.

Here are the rate ranges for each loan product at Discover:

Loan product Variable rate Fixed rate
Undergraduate 3.12% – 11.62% APR 4.74% – 12.49% APR
Graduate 3.74% – 11.62% APR 4.99% – 12.49% APR
MBA 3.74% – 11.62% APR 4.99% – 12.24% APR
Health professions 3.74% – 9.62% APR 4.99% – 10.49% APR
Law 3.74% – 9.62% APR 4.99% – 10.49% APR
Residency 5.62% – 8.62% APR 6.99% – 9.99% APR
Bar exam 6.02% – 11.62% APR 7.39% – 12.99% APR
Consolidation 10-year: 4.24% – 7.49% APR
20-year: 4.24% – 7.49% APR
10-year: 3.99% – 6.99% APR
20-year: 3.99% – 6.99% APR

Lowest rates shown include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments for in-school products, and 0.25% interest rate reduction while enrolled in automatic payments for consolidation loans.

Fees and penalties

One major upside to getting a loan through Discover is that it charges no fees. There’s no loan application fee, origination fee or late fee. It also doesn’t charge a prepayment penalty.

Repayment terms and grace period

The type of loan you receive from Discover determines your repayment period and grace period. Undergraduate loans from Discover come with a repayment period of up to 15-years and a six-month grace period. That means that full monthly payments aren’t due until six months after you graduate, or your enrollment status drops below half-time.

All other student loans from Discover, including graduate loans, have a repayment period of up to 20 years and a grace period of nine months. The grace period for bar exam and residency loans ends nine months after graduation.

All loans except for consolidation loans have two repayment options: in-school and deferred. The in-school option requires you to pay at least $25 per month while you’re in school. With the deferred option, you make no payments while you’re in school.

Payments are still required for any borrowers who elect for interest-only or $25 fixed monthly payments.

Customer service

Discover gets an “A+” rating from the Better Business Bureau, the highest possible. The rating takes into account complaint history and whether the business has appropriately responded to complaints, resolved them in a timely matter and has made a good faith effort to resolve those complaints.

Discover’s customer service department is available via phone, email, fax or mail.

Student loan specialists are available by phone 24/7 at 1-800-STUDENT.

Customers with questions about their account or application may log in via Discover’s website and send the customer service department a secure email.

Discover may be reached by fax at 1-224-813-5195.

And general correspondence with the company can be sent by mail to:

Customer Service
PO Box 30948
Salt Lake City, UT 84130-0948

Application process

You can start the application process for a Discover student loan online, with a result in as little as 15 minutes.

Before getting started, students will need their Social Security number, school information (including field of study and period of enrollment), desired loan amount, any financial aid you’ll receive, financial information and address.

Cosigners will need to supply their Social Security number, loan amount desired, employment information, financial information and permanent address.

Here are four main steps to apply for a loan through Discover:

  1. Start the online application process
  2. Include a cosigner, if desired
  3. Choose either fixed or variable interest rate and a repayment option
  4. Once approved, sign and accept loan documents

Get pre-qualified

Answer a few questions to see which personal loans you pre-qualify for. The process is quick and easy, and it will not impact your credit score.

What to do if your application is turned down

If you’re rejected for a student loan from Discover, first contact the lender to get clarification. It’s important to know the reason you were turned down, which can be helpful when applying to other lenders. It’s also possible that there was a processing error with your loan.

Remember that there are plenty of lenders willing to compete for your business. Lenders like Sallie Mae, LendKey and Citizens Bank all offer competitive rates on undergraduate and graduate student loans.

Make sure to shop around thoroughly and find the best student loan for your needs before settling on a lender.

How Bankrate Rates Discover

Overall Score 4.4
Repayment Options 3.8
Affordability 4.4
Customer Experience 5.0

Disclosure: Lowest rates shown include an interest-only repayment discount and a 0.25% interest rate reduction while enrolled in automatic payments. The interest rate ranges represent the lowest and highest interest rates offered on Discover Undergraduate Loans. The fixed interest rate is set at the time of application and does not change during the life of the loan. The variable interest rate is calculated based on the 3-Month LIBOR index plus the applicable Margin percentage. The margin is based on your credit evaluation at the time of application and does not change. For variable interest rate loans, the 3-Month LIBOR is 2.25% as of October 1, 2019. Discover Student Loans will adjust the rate quarterly on each January 1, April 1, July 1 and October 1 (the “interest rate change date”), based on the 3-Month LIBOR Index, published in the Money Rates section of the Wall Street Journal 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125). This may cause the monthly payments to increase, the number of payments to increase or both.