UW Credit Union has some pretty stringent requirements for eligibility in order to satisfy the application process. They run the gamete of typical lenders with rewards for automatic payments, and they cut out the origination fee. For every positive, there are still some red flags which, unless you live in the area, would be best to search for better deals.
Loan Rates and Longest Terms
- Fixed rate ranges starting from 6.74% APR.
- Variable rates start as low as 2.78% APR (though rates change quarterly)
- 15 years loan term
- UW Credit Union specifies the cap is 15%.
- You have to be a member of UW Credit Union to get your student loans refinanced
- To become a member you have to be associated with the University of Wisconsin System (any of the 26 branches) or Madison College in some way; It could be as student, faculty, staff, or alumni. You can also live or work within 5 miles of a branch.
- You must be age of majority in your state of resident when you apply (usually 18)
- You must be a U.S. citizen or permanent resident with a Social Security number
- You need a yearly salary of $25,000 (variable rate only)
- Your debt-to-income ratio should be “reasonable” (likely around 35%)
- You should have built up at least 5 years of credit history (student loans excluded)
- You have the option to make interest-only payments during the first 2 years of your loan.
- You can consolidate both federal and private loans up to $45,000
- Automatic payments receive the 0.25% interest rate deduction
- Cosigner release after 36 months of timely payments
- There is no origination fee or prepayment penalties
- Longer repayment terms, increasing the total amount paid over the life of the loan given to interest
- If you’re late on a payment, you’ll have to pay 5% of the amount past due, or $10 – whichever is less.
- If your payment fails to go through for any reason, you’ll have to pay a $15 fee
- If you need that lower monthly payment right now due to hardship. But try to pay extra when your situation improves.
- Unless you’re a member of UW Credit Union already, you’ll can receive better rates elsewhere
- There are plenty of other online lenders who don’t require 5 years of credit history
Your interest rate is determined by your credit score, credit history, and type of school you attended. You can have a cosigner if your credit isn’t up to par.
Lenders who consolidate both federal and private loans offer relief with one payment but, you should be aware you will lose some important benefits associated with federal loans. Some of these benefits, such as deferment, forbearance, forgiveness, and any income based repayment plans also can be considered relief during financial hardships. If you’re in the military, you also lose out on an interest rate deduction under the Service members Civil Relief Act for both Federal and private student loans taken out prior to enlisting.
As well, most Federal student loans are fixed rate loans. While lower interest rates on variable rate options look attractive, this still means your payment may increase at any time. Fixed rates mean stability and predictability.
The Application Process
UW Credit Union states the process could take 2 – 4 weeks to complete
- Personal Information
- Employment Information:.
- Contact Information for Nearest Relative:
- Student Loan Information: You should have your most recent student loan statement scanned in (or have a PDF copy).