Discover has been offering private student loans since 1960 and currently lends to students in all 50 states. The company believes in responsible borrowing and encourages students to maximize scholarships, grants, and other free financial aid before taking private loans. However, for students who do need to take out loans, Discover offers a number of options, including undergraduate loans, graduate loans, MBA loans, health professions loans, law loans, residency loans, bar exam loans, and consolidation loans, as well as a quick application process.
There are no fees attached to any of Discover's student loans, which means that borrowers will not be subject to loan application fees, origination fees, or late fees. This can provide students with significant savings over the life of the loan.
With Discover, up to 100 percent of school-certified college costs are covered. These costs may include tuition and fees, housing, textbooks and other supplies, and computers or tablets.
Discover rewards its borrowers for good grades. If a student gets at least a 3.0 GPA (or equivalent), they will qualify for a one-time, 1 percent cash back reward on each new Discover student loan. Students who are approved for an undergraduate, health professions, law, MBA, or graduate loan are eligible for this reward.
All of Discover's student loan specialists are based in the United States and are available around the clock to provide help and answer questions.
Discover's student loan APRs are relatively high when compared to other top companies in the industry. Interest rates for fixed loans range from 6.24 to 12.99 percent, while rates for variable loans range from 3.87 to 11.12 percent. A 0.25 percent interest rate deduction is available to borrowers who enroll in automatic payments.
Discover has not disclosed its maximum loan amount, so it's unclear how much students can borrow. At 15 years, the company's maximum loan length is relatively short, which means that students have less time to repay their loan.
Discover's student loans come with a variety of attractive features, including zero fees, up to 100 percent cost coverage, rewards, and US-based loan specialists. However, the company's interest rates are relatively high compared to industry average, and its loan terms have room for improvement.
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