Laurel Road Student Loan Review
Darien Rowayton Bank (DRB) was one of the largest and biggest players in the market for student loan refinancing. As of the month of June in the year 2017, DRB changed to Laurel road and is henceforth referred to as the same.
Although they have changed their name their offerings still remain the same and only the look and feel of their website have changed.
Table of Content
|1||Laurel Road Student Loan Review|
|2||Pros and cons of Laurel Road|
|3||10 Reasons to use Laurel Road|
|5||What is a good time to refinance?|
Pros and cons of Laurel Road
One of the advantages that are major with Laurel road is that it isn't just another other student loan company but it is the product of a Bank, and since banks face a higher range of scrutiny in the sense of lending practices in comparison this means to say that borrowers will be much less likely to face any lender troubles when they apply for a loan.
Laurel Road is also one of those in the student loan business that offers a very tight range on their interest rates. They usually do not offer the lowest advertised rates on the market, but when the borrowers apply for loan estimates with many lenders they tend to find that the best option in terms of rates is offered by Laurel Road.
If you are currently a medical professional, Laurel Road offers a number of unique services that are tailor-made for your situation. This also takes into account your residency and fellowship repayment options that allows you to pay about $100 until you become an attending physician. This will allow borrowers to right off the bat lower their interest rates and keep their payments down until their finances allow for a higher amount of payments per month.
Lastly, Laurel Road offers a bonus to the new customer of the amount of $150. Borrowers must still try and focus on getting the lender that offers them the best interest rates and also fees in terms of charges and more, but the new customer bonus is a nice addition for those that are new and are going through the steps to refinance their student loans
The major disadvantages for laurel road mostly apply to almost every other lender in the student loan market
First off, they let you consolidate your federal student loans in their private student loan refinancing options. For certain borrowers, this might seem like a pretty smart financial move. Because reducing the interest rates on your federal student loans can help you save a few thousand dollars over the life of your student loans.
However, making this choice can also be a major mistake as this also means that student loan forgiveness programs and an income-driven repayment plan no longer become available to you. So when you choose to consolidate make sure you keep in mind that you are giving up these privileges and that you are doing so knowingly and understand the consequences.
Next, Laurel Road does offer a co-signer release program, but you must keep this in mind and also mention it to your co-signer to not expect or rely upon this co-signer release. For starters, Borrowers are unable to even apply for a co-signer release for the entire period of the first 36 months of their loan repayment plan.
After the first 36 months, they are eligible to submit a release application, but it doesn't necessarily mean that it will be approved. Because this co-signer release involves so many steps and due to the nature of uncertainty of this co-signer release program, we encourage all the co-signers who are present on all loans to be ready to stay for the entire duration of the loan period or until the loan is repaid in full.
Low repayment options for those who have a medical residency
You get to keep your federal grace period.
They offer forgiveness on the basis of disability.
They do not have a mobile app
Forbearance options vary from case to case.
The bottom line is that since they offer to maintain your federal loan grace period they are a pretty good option.
Refinancing might be a great option considering you get a much better interest rate with regard to your current rate.
But before you proceed with refinancing keep in mind the following
Refinancing your debt is just a big deal as it is when you sign up for a new loan, you should be doing all the research possible regarding the terms and the lenders whom you are considering to apply to.
Having a look at your review on laurel road. You should find the things that are beneficial from refinancing with them, and what you need to look out for, and how laurel road comes up in comparison to other lenders.
10 Reasons to use Laurel Road
A very competitive interest rate offering
Laurel road offers some of the most narrow and lowest interest rate ranges in the student loan refinancing market
You get the pick of the lot with regard to your loan term and it ranges from anywhere between 5, 7, 10, 15 or 20 years.
This is unrestricted in terms of the loans on which this is offered, you get to avail this on both their fixed and variable loans.
Loan Term Flexibility
Giving you the flexibility in deciding how long you might need to pay them off.
And in case you want a different term, Laurel Road will work with you to come with a term that is of your convenience as long as it is under 20 years.
Saves you Money
You will be able to save money since less money is spent on the interest payments and more money towards the principal. So essentially you will pay off your loans much faster.
This also will turn out to be saving you more money over the life of the loan and this means more money stays in your pocket.
Go around and have a look at other lenders. Shop around with the different lenders to see where you are getting good interest rates. You are able to get multiple rate quotes without any obligations. Have a look at some of the top student loan refinance lenders.
Refinance without any limit
There is no limit placed on the amount that you can refinance since some lenders tend to have a limit on the amount that you may refinance, but laurel road has no max limit. Although they do have a minimum limit of $5,000 in loans to be eligible for their student loan refinancing.
No fees charged
Also, Laurel road does not require you to pay any fees to refinance with them. Their whole point of refinancing is to help you save money. You do not want to throw away your hard earned dollars on some loan refinancing fees. Laurel Road does not charge any application or loan origination fee. And you will not be fined or made to pay a penalty fee if you repay your loans earlier.
Put your loans on Hold
You have the option to put your loans on hold in the instance that you are out of a job. Laurel road gives you a 12 month forbearance period in the situation where you become unemployed. Which also means that there is one less thing to stress over.
Retain your grace period
You do not lose any grace period. Laurel road will honor any deferment or grace period that you had at the time with your current lender. In case you are in a medical residency, you can even have the payments deferred until about 6 months after it ends.
Extra Rate Discounts
Additional rate discounts if you are a customer of Laurel Road. If you have a checking account with DRB then you are eligible for an extra 0.25% knock-off your interest rate when you loan gets set up for auto payments.
You can also get paid for free technically, but then again it's about referring laurel road to family and friends. Whenever a friend or a family member refinances with laurel road, you will get a $400 cash referral bonus. There is technically no limit on the number of people that you are able to refer, so it is a pretty decent way to earn money that you can use to pay your loans off sooner.
You can also choose to share some of the referral money with the person that you referred to. They have an easy to use a sliding scale that helps them determine your bonus.
No location restrictions
You aren't restricted on the basis of your place of stay. Since some refinance lenders offer loans in only a certain number of states. There can be problems due to this to some borrowers. Laurel road is available in all 50 states in the U.S. of America, so you needn't look further.
Risks that you might have to take?
In many of the cases, refinancing your student loans might seem like the smart thing for you to do. But you need to consider a few things before you go ahead and proceed with this -
You are taking a slight risk by refinancing your federal student loans. Laurel road allows you to refinance your federal loans and your private loans together into a single loan, but this isn't always a good thing to do.
When you convert a federal and a private student loan together into a private loan you are losing a few important benefits which come with your federal student loans.
Such as the option to enroll in an income-driven repayment plan. Or forgiveness of your loans if you get into public service employment through the various programs that are related to that such as the Public Service Loan Forgiveness program and more.
All of these things are important to consider if you might want to work in the public sector or might not have a good income for a couple of years to come.
You might land up with having a much higher rate than you were paying before. Laurel road offers a loan with a variable rate option. This might sound good. But since the actual loan rate is tied to the 3-month Libor index, hence if this Libor index goes up so does your rate.
The max Variable APR tops at 9% for a 5 and 10-year loan and 10% for 15 and 20-year loan. Those rates could be much higher than the rates you currently have especially if your current loan is a fixed rate loan.
You might need a co-signer. When you apply for a loan refinance, your credit is definitely going under a microscope.
In case you are not able to meet the minimum standards, you will need a co-signer to get a loan.
Not being able to find someone who might be willing to put their credit reputation on the line for you, this might put refinance out of the equation for you then.
What is a good time to refinance?
Usually, your common sense would tell you that the best time to refinance your loan would be when the rates are low. But since the rates are at an all-time low and have been that way for quite some time but keep this in mind that they won't stay that way for a long time.
Considering this whether you should refinance or not depends on the kind of rate that you qualify for. In the situation where your credit right now is bad, you may be better off waiting until your credit improves. But if you have a good credit score, you will want to cash out on the lower rates before they shoot up.
Is it possible for everyone to refinance with Laurel Road?
Not really, since laurel road has a couple of guidelines that you are required to meet before you become eligible for refinancing. The bank is looking to see if you have finished a degree and have established yourself in a career. Or if you at least have an offer letter to begin working in the near future.
Your credit score and income still play their part, but those two aren't the only things the bank is interested in.
The bank also looks in and has a point to note down these things -
You must have a bachelor's, graduate, or professional degree
You must be employed
You must be a U.S. citizen or permanent resident
You must meet the credit underwriting standards
You must have at least $5,000 in loans
If you are employed in the medical field, you will also be required to have a license to practice and also proof of malpractice insurance.
Any applicants that decide to go ahead with Laurel road are required to provide some background information. This might include proof of regular payments on other services, student loan statements and the proof of graduation from a school.
As with the approval of your loan, your credit history and score will carry most of the weight, as will your income and work history. In case you do not have the kind of credit score that they might be looking for, you will either require a co-signer or consider another lender for the purpose of refinancing your student loans.
Have a look at your credit reports before you consider applying for any sort of loan refinance to understand where you stand in terms of the odds of getting an approval for your loan refinances.
How to get things started with regard to the application?
Signing up for a Laurel Road loan is sort of like signing up for a bank account. To being with your refinance application with Laurel Road, you will be needed to fill out a short form online to find out whether you are eligible for the loan to refinance or not.
The info that Laurel road usually requests for during the application process is the name of your school, the state where it is located, your citizenship status and email address.
In the instance where you are eligible, you will be able to move onto the next phase. you will need to create an account with a unique username, password, and a security question. From here on you will be required to add in more detailed info, which can be the following but not limited to this -
Social Security number
Driver's license number
Loan account information
After entering all the correct info that is requested, you are able to submit the application online. If your application is accepted and your loan approved, Laurel Road will pay off your old loans and then replace it with a new one. Once the old loans are zeroed out, you will begin making payments to the new loan with Laurel Road.
Wondering if it is worth the trouble?
Refinancing is all about the search to get the best rate you can at that point in time. You might not get the lowest rate that they advertise. Whereas some borrowers might save money more compared to some other borrowers.
If you have got some good credit, you are more or less likely to get a much better rate than if you have an average credit score or FICO score.
And in case the rate you are offered is not as low as what you expected to be offered, you are under no obligation to move forward with the refinancing.
Someone who still has a long way to go before paying off their loans has a lot more to gain in terms of value out of refinancing than others with shorter terms remaining on their loans.
Most often the money you put into the payments of a loan in its earlier years tends to go towards paying the interest rather than paying for the principal. If you have just a couple of years left on your loan then refinancing might not be your best option at helping you.
Wondering how they stack up against each other?
So basically speaking Laurel Road offers both Fixed rate and variable rate student loans. Borrowers have the option of 5,7,10,15 and 20-year repayments terms. Generally speaking, the longer the terms on their loans the higher the interest rates on them, but lower monthly payments since the loan is spread over a longer period of time.
Interest rates on the variable rate loans begin at 3.23% with a max currently at 6.65%. The fixed rate loans begin at 3.5% and go up to a max of 7.02%. The min refinance or consolidation limit is at $5,000 and there is no limit on the max that can be refinanced. Laurel road does really well on the 10 and 7-year variable rate loans are currently considered the best available in the market.
Like other genuine lenders, Laurel road does not charge any origination fees or prepayment fees.
Also, Laurel Road offers loan refinancing which is specifically tailored for parents who took out loans for their children and for physicians who are in their residency.
There are quite a few similarities between firms that refinance student loans, but there are also many different ways. You should consider having a look at the different competitors to get a close idea.
Have a look at the other topics we have on the different firms that are offering student loan refinancing to figure out which one suits you best and to get an idea on what firm you should go ahead and pick.
Laurel Road student loan refinancing review FAQs
What is Laurel Road?
Laurel road is one of the industry leaders in the private student loan refinancing sector. They have some of the lowest interest rates and more flexible terms than most of the competitor lenders. Laurel Road has been doing the student loan refinancing business for quite some time, but previously under a different name called DRB or Darian Rowayton Bank.
Is refinancing my student loans a good idea?
Refinancing is a good attempt at looking to get a loan at a much lower interest rate and get a better than the one you already have. If your current rate is pretty high then you are more probable to benefit from the loan refinancing at a lower rate. You will also need to have a good credit score and also have to meet the underwriting criteria of some of the best lenders that refinance student loans.
What credit score do you need to refinance student loans?
Although 650 is a low credit score in comparison to the ones that most lender will accept, it is pretty close to being in the approval range. This means that almost 70% of the consumers have credit scores that must meet the minimum requirements for student loan refinancing.
Does Refinancing student loans save money?
Usually, the more you owe on your student loans, the more that you are able to save by refinancing it. Student loan refinancing will save you money if you end up being eligible for it and qualify for a lower interest rate and either keep the same term length or opt for a shorter one
I have a loan with laurel road, now they are a part of KeyBank, how does it affect me?
Student loans refinanced with Laurel Road will continue to be serviced by MOHELA, the student loan servicing partner of laurel road. If you have any questions about your student loan payments after funding your loan with Laurel Road, please call MOHELA at 877-292-6845.
Who Funds my loan?
Any loans that were made to on or after the date April the 1st 2019 will be under the care of KeyBank and will also originate from them, this is due to the Laurel road now becoming a part of KeyBank.
How long until I hear about my loan decision?
Loan decisions can take time depending on the nature of the complexity of the submitted application. After all your paperwork is submitted and then verified, a decision shouldn't take longer than a day.
Does Laurel Road have any limit on their loan refinancing?
No, Laurel Road does not have a limit on the amount that you can refinance with them. Although they do require you to have at least $5,000 in student loans to be able to qualify for refinancing.
Is it possible to change my payment date?
Yes, you can change your payment date if you would like to, this is possible through their website, which will be processed within a time of 1-2 billing cycles.
Do they charge any fees during the application or loan closing process?
No, Laurel Road unlike many of the other lenders, do not have any sort of fees with regards to the processing of your application, origination or any disbursement fees - they also do not have any prepayment penalties.