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Funding U Student Loans: 2024 Review

Updated on Nov. 20, 2023

At a glance

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Rating: 3.5 stars out of 5
Bankrate Score
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Repayment Options
Rating: 2 stars out of 5
Rating: 4.4 stars out of 5
Customer Experience
Rating: 4 stars out of 5

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Funding U is an online lender offering undergraduate private student loans with fixed interest rates. It stands out for not allowing co-signers and making lending decisions based on your GPA and future career path. However, it caps annual loan amounts at $20,000, so it’s best for students who have covered most of their expenses with federal loans and need a small amount to fill in any gaps.

Lender Details


Loan amount

$3,001 to $20,000 per academic year


APR from

7.49% to 12.99% (with Autopay)

Clock Wait

Term lengths

10 years

Funding U features

Funding U has limited lending options, offering only one private student loan for undergraduate students. However, its unique eligibility criteria makes up for the limited offerings.

Rather than relying on credit score and income to make lending decisions, Funding U uses its own proprietary scoring system based on academic progress and success. The lender tailors its product to undergraduates even further with its blog, which covers everything you need to know about building credit, paying for college, job hunting and more.

Funding U: In the details

Pros and cons of Funding U student loans

Funding U’s unique lending process comes with benefits, but it also has its drawbacks. Here’s what you need to know about the lender before applying.

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  • Online preapproval: Borrowers can get preapproved in minutes and view potential loan offers. This feature only requires a soft credit check that won’t negatively impact your credit score.
  • No fees: Some lenders tack on an origination fee each time you take out a loan. Funding U does away with all fees, including origination fees and application fees.
  • Accessibility: You could be eligible for funding with little or no credit history since eligibility is based on academic performance and other merit-based factors. Plus, you won’t need a co-signer, which is uncommon among private student loans.
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  • Limited repayment options: Unlike with most lenders, you are required to make payments while you’re in school, though you can choose between a flat $20 payment and interest-only payments. Once you graduate, you are also limited to one repayment term of 10 years.
  • Availability: Funding U loans are available in only 38 U.S. states. While the list of eligible states is growing, residents outside of these states currently cannot borrow with the company.
  • Low maximum loan amount: The maximum amount of $20,000 per year is low when compared with other lenders, some of which offer up to the full cost of attendance.


In order to quality for a Funding U student loan, you must:

  • Be a U.S. citizen, permanent resident or DACA recipient.
  • Be at least 18 years of age.
  • Be an undergraduate student enrolled in a bachelor’s degree program at a Title IV-eligible four-year college.
  • Be enrolled full time.
  • Be enrolled in an approved program or field of study.
  • Be a resident of a qualifying state.

When making lending decisions, Funding U says that it considers students’ academic success in college, likelihood of graduating on schedule and projected total student debt. And while there is no minimum credit score requirement, Funding U will review applicants’ credit histories to ensure that there’s no pattern of late payments, collections or other indications of an adverse credit history.

Who is this loan good for?

Funding U is a great option for undergraduate students with little to no borrowing history who do not have a co-signer. Academic high achievers are most likely to be approved for a loan with Funding U. Funding U could also be a good choice for borrowers who don’t need to borrow much in student loans, since it caps its loans at $20,000 annually. But if you need to cover the total cost of attendance, you’ll typically have better luck elsewhere. 

Interest rates and terms

Funding U offers undergraduate student loans with fixed interest rates — there’s no option to select a lower variable rate. Keep in mind that the specific terms and conditions of your student loan will vary based on your graduation year and state.

Loan product Variable rate Fixed rate
Undergraduate student loans N/A 7.49%-12.99% APR (with autopay)

Fees and penalties

There are no application fees, origination fees or cancellation fees associated with a Funding U student loan. You also won’t be charged a pre-payment penalty should you decide to pay the loan off early.

Repayment terms and grace period

Borrowers have a few payment options while they’re still in school:

  • Interest-only payments every month.
  • $20 minimum payments every month.

The in-school period can last up to 51 months, at which point loans enter a six-month grace period. Loans will also enter the grace period if you drop below full-time enrollment.

After the six-month grace period, students will begin repayment. There is only one repayment term offered; students must repay their loans over a period of 10 years.

Forbearance is offered in 90-day increments for borrowers in school or in repayment who meet certain criteria. 

How to apply for a loan with Funding U

You can apply for a student loan directly on Funding U’s website, starting with a preapproval process that’s based on factors like academic achievement, courseload, projected graduation date and future earnings.

In order to speed up the application process, you will need to have these documents on hand:

  • State-issued ID.
  • Most recent full transcript.
  • Financial aid award letter.
  • Tuition bill.

Here’s what the process will look like after getting preapproved:

  1. You’ll be assigned a dedicated loan officer who will assist you with details like your loan offer, repayment options, interest rate and terms.
  2. You’ll then submit the documents listed above to finalize the loan offer.
  3. If needed by your school’s financial aid office, you can request your preapproval letter from Funding U.
  4. Once the semester starts, your loans will be disbursed to your school.

Applications for the upcoming school year typically open in June.

Customer service

Funding U’s customer service department is run through Launch Servicing. If you have a question about your current loans, you can contact a customer service representative through a phone call, by email or via the online portal. Phone support is available at 877-354-2629 from 7 a.m. to 7 p.m. CT Monday through Friday. You can also send an email to or log into your account to send a secure message through the online portal. 

If you’re sending correspondence, you can send it to Launch Servicing, LLC, P.O. Box 91910, Sioux Falls, South Dakota, 57109. If you’re mailing a check, address it to Launch Servicing, LLC, P.O. Box 679220, Dallas, TX 75267.

Prospective borrowers can schedule a call with a Funding U representative or send an email to Support is available 8:30 a.m. to 8:30 p.m ET Monday through Friday. 

FundingU isn’t accredited by the Better Business Bureau, but it holds an A- rating. 

Funding U frequently asked questions

How Bankrate rates Funding U

Overall Score 3.5
Repayment Options 2.0 Funding U’s loan options are extremely limited, with a low maximum loan amount and only one repayment term.
Affordability 4.4 Funding U’s minimum interest rate is high, though it does accept borrowers without co-signers.
Customer Experience 4.0 Funding U falls short for its slightly limited customer service hours, but it has a solid online platform and an autopay option.


The Bankrate team evaluated over a dozen lenders to select our top picks for the best student loans. To do this, Bankrate considers 14 factors, including loan amounts, fees, repayment terms and options, as well as fixed and variable APR ranges. Then, lenders are rated using our vetting system known as the Bankrate Score, which focuses on three main categories.

  • Availability: We looked at minimum and maximum loan amounts, as well as the lender’s eligibility requirements, co-signer option, degrees covered and state availability. Lenders that offered the most flexibility as well as nationwide servicing and that offered financing for a variety of programs ranked higher in this section.
  • Affordability: Fixed and variable interest rates, fees, penalties and discounts were measured in this category. Lenders with the lowest rates, fewer fees and multiple discounts got the higher scores.
  • Customer experience: Our team looked at the ease of the application process, as well as online account management tools, customer support hours, app availability, repayment options and grace periods offered by the lenders. This allowed us to determine the lenders’ ability to satisfactorily serve customers.

Editorial disclosure: All reviews are prepared by staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the lender’s website for the most current information.