Sallie Mae Slashes Private Loan Rates
RESTON, Va. – Sallie Mae said it is reducing the rates it charges on private student loans for the 2011-2012 academic year.
With zero origination or repayment fees, Sallie Mae’s Smart Option Student Loan is available at variable rates ranging between 2.25% and 9.37% APR, based on today’s LIBOR index. Students can also earn back 2% of their scheduled monthly in-school payments simply for making their payments on time.
The new rates, effective Monday, range from Libor-plus-2 basis points to Libor-plus-9.875 basis points, or 2.25% to 9.37% at today's rates. That compares with the prior range of Libor-plus-2.5 basis points to Libor-plus-10.875 basis points. Federally guaranteed Stafford loans offer a fixed rate of 4.5% or 6.8%, depending on the type, while the government's Parent PLUS loans are set at 7.9%.
Sallie Mae also added a new Tuition Insurance Benefit to the Smart Option Student Loan, which reimburses up to $5,000 of tuition, room, board and other covered fees not refunded by the school if a student is forced to withdraw for eligible medical reasons. Sallie Mae’s Tuition Insurance Benefit, for loans first disbursed between July 1 and Oct. 31, provides 12 months coverage at no charge to the student, giving families peace of mind and safeguarding their college investment.