Discover Financial Services started in 1985, and is headquartered in Riverwoods, Illinois. It is a well-known, direct banking company that provides a multitude of services, including student loans, personal loans, home loans, debt and transaction services, and more. Interest rates are largely based on credit history, interest rate type (variable or fixed), and the cosigner's credit history (if applicable). The company offers a private consolidation loan to help existing Discover student loan customers. Discover doesn't charge an application, prepayment, late or origination fee.
Private Consolidation Loan
Discover's private consolidation loan allows existing Discover student loan customer to refinance their federal and private student loans. In addition, borrowers can potentially lower their interest rate and monthly payments, combine their loans into one monthly payment, and obtain a loan with or without a cosigner.
The minimum loan amount is $5,000, and payments are due 30-45 days after the loan is disbursed and consolidation is complete.
Customers receive a .25% interest rate discount by signing up for automatic payments.
Transparent Website and Company
The website is extremely transparent and includes all of the most important information. Their FAQ section is helpful and informative.
Discover Mobile App
Discover has a mobile app for both iOS and Android devices, and allows users to view account activity, earn reward points and more.
Payment Deferment Options
People who go back to school at least half-time can enter a deferment period. Additionally, military active duty members, people in the public service (with eligible organizations), and health professionals doing a residency program can also qualify for deferment.
Active on Social Media
Discover is a well-known company with a long history of helping their clients. The company runs a Facebook, LinkedIn, Twitter, and Youtube page, each with a large number of followers.
Customers are not charged an application, origination, prepayment, late, or annual fee.
After borrowers apply, it can take around 30-45 days to process. It is during this time that Discover checks credit history and similar points.
Not All Loan Types Are Eligible
According to the company's website, the following loans are not eligible for Discover's private consolidation loan:
- Loans for K-12 education
- Post-graduate loans (ex: bar exam loans, residency loans)
- Loans that weren't used for qualified education expenses
- Loans taken out while enrolled less than half-time
Unclear State Availability
While Discover clearly states that personal loans are available in 50 states, the company does not provide any information on state availability for private consolidation loans.
Unclear Repayment Terms
Discover does not provide a detailed description of their repayment terms upfront. The main private consolidation loan homepage excludes this information. Discover does not give specific rate ranges for each term offered.
The private consolidation loan is meant for existing Discover student loan customers. People who are not current Discover student loan members are out of luck.
The Bottom Line
Discover has been in the industry since 1985, and is trusted and well-known. Their private student consolidation loan works with both federal and private student loans, and borrowers can choose between a variable or fixed interest rate. The minimum loan amount is only $5,000, and there are absolutely no fees. Their website is transparent and lists all of the most important information.
Cosigners who want to apply for a release should inquire elsewhere since the company requires them to stay on for the life of the loan. Additionally, borrowers need to be 18 years or older, and current Discover student loan members. For those who meet the eligibility requirements, Discover is a solid option to look into.