Most private student loan lenders loan money directly as either a first-time loan or a refinanced loan.
Other lenders, like LendKey, use a marketplace model to pair borrowers with different loan potions from community banks, credit unions, or other local institutions. This model is advantageous for borrowers looking for special features, like low rates or a unique term.
Here is our full review of LendKey student loans.
What is LendKey?
LendKey is a third-party student loan lending platform started in 2009. Operating in both the refinancing and private student loan space, LendKey offers borrowers:
Undergraduate school loans
Graduate school loans
Parent loans
Like we mentioned, the company is not a lender itself, but serves as a partner to over 13,000 smaller banks and credit unions, advertising their competitive rates through their platform. Even with their vast network of participating lenders, the below eligibility criteria pertain to most all partners, though you may find some slight variations.
LendKey loan eligibility
LendKey student loans are available to borrowers that meet the following eligibility requirements:
Have a credit score of at least 660
Live in a state that is not Maine, Nevada, North Dakota, Rhode Island, or West Virginia
Be a United States citizen or permanent resident with a legal status
Earn at least $24,000 annually, or $12,000 with a cosigner
Maintain a debt-to-income ratio below 50%
Those looking to take LendKey student loans may choose from 5-, 10-, and 15-year terms.
Refinancing with LendKey
LendKey offers student debt refinancing loans up to $300,000 for certain borrowers. Your loan amount will be determined by considering your educational achievement level as it appears below.
For undergraduate loans, you can refinance $5,000 - $125,000.
For graduate degrees, you can borrow up to $250,000.
For medical degrees, including dental and veterinary school, you can borrow up to $300,000.
These figures do vary ever so slightly based on the state in which you reside. Massachusetts, for instance has a minimum loan of $6,000, while a couple of other states have $10,000 minimum thresholds. But if you have more debt than that, these nuances will not come into play.
LendKey's average refinancing client earns about $90,000 annually, which is lower than with some other lenders, making them a natural fit for borrowers earning less than $100,000 per year.
Rates and terms
Though interest rates offered continuously change with market conditions, as of January 2024, LendKey offers fixed APR rate options beginning at 8.11%. Borrowers may choose among additional term options than on original student loans too, with options including:
5 years
7 years
10 years
15 years
20 years
Refinancing fees
Part of what makes LendKey refinancing so appealing for borrowers is their lack of substantial add-on fees. For example, LendKey does not charge:
Application fees
Loan origination fees
Prepayment penalties
Whether they assess collection and disbursement fees is not disclosed.
How does working with LendKey work?
LendKey's homepage offers you front and center access to begin rate shopping for interest rates on both private student loans, as well as refinanced loans.
You'll begin by providing some base level information about:
Your degree/education progress
Address
Income
Existing student loans
You'll then begin to receive loan officers from lenders within the company's network. In most instances, you don't care who the loan is underwritten or offered by, as you are likely to shop for the most competitive term and interest rate that works best for you.
Since rate shopping may impact your credit score (if searches conduct hard credit inquiries), it is generally advised to do so within a short period of time.
Since the majority of LendKey's network won't be an option to you because of geographic region, income, or other factors anyway, you'll likely want to consider doing your other rate shopping with other lenders at the same time.
Pros and cons of refinancing with LendKey
As with any refinancing company or lender, there are distinct pros and cons to doing business with LendKey. The most notable pros are:
The lack of fees
The ability to browse rates from multiple lenders at one time
Extended forbearance available
Pro: The lack of fees
LendKey has no loan origination fees or prepayment penalties. While the lack of prepayment penalties has become more mainstream in the student loan space in the past few years, many rivals, like CommonBond, still do have some origination fees for certain types of loans.
Pro: Search multiple lenders at one time
Since LendKey is a marketplace, rather than a lender, you'll be able to see rates across multiple different lenders at one time.
At this time, they have relationships with over 300 lenders, many of them known for their customer service.
Pro: Extended forbearance available
With the potential of 18 months of lifetime forbearance available to those who opt for longer 15- or 20-year terms, it is a much more generous program than most lenders offer, though interest will continue to accrue during this time.
Now, a few areas where we'd like to see the LendKey platform improve.
(Potential) Con: LendKey's relationship with local banks and credit unions
While LendKey allows you to browse different rates across multiple lenders, many of these lenders are small community banks and credit unions, which means that you may find different eligibility criteria with each lender.
While not a deal breaker by any means, it is something that you will want to pay attention to. It can easily become a pro if you receive great and personalized service.
Con: No standard cosigner release
Additionally, since you can browse different lenders, there is no standard policy or procedure when it comes to cosigner release. Instead, it depends on the lender that you ultimately refinance with.
LendKey vs CommonBond, SoFi, and Earnest
You're probably wondering how LendKey compares to its' rivals, CommonBond, SoFi, and Earnest among them.
We'll start with CommonBond. Offering similar terms and the ability to refinance a lot of money at one time, both "lenders" are highly rated. CommonBond does charge origination fees for certain types of of loans (mainly graduate school), whereas LendKey does not. CommonBond does have more robust hardship options, however.
SoFi may be the closest competitor in terms of offerings. If you're considering refinancing your student loans, you'll likely want to rate shop with both lenders.
Earnest also may be a suitable alternative for you if your credit score isn't quite where you want it to be, since they focus more on your career history and earning potential, while also having some of the lowest minimum credit scores.
But from our experience, we'd recommend Splash Financial first over LendKey. Much like LendKey, Splash is a marketplace that can compare rates across its network of lenders for you. Unlike LendKey, Splash does offer cosigner release options, and you can rate check in less than three minutes without hurting your credit score.
Is refinancing with LendKey right for you?
The majority of student loan borrowers report positive experiences after refinancing with LendKey. Most commonly mentioned is an intuitive and easy online tech experience.
But how do you know whether refinancing with LendKey is right for you? Over the past couple of years, we've gained a lot of experience regarding the various private student loan lenders on the market, and have built a checklist to help you determine whether the LendKey experience is right for you:
Can your new rate save you money? Remember your primary objective for refinancing. You are either looking to reduce your monthly payments, shorten your repayment term, or in some scenarios, both. If your goal is to increase your monthly cash flow, you'll want to be sure that your new rate allows you to do this.
Are you okay without cosigner release? The lack of a cosigner release program does not mean that you cannot apply with a cosigner, but rather that once your cosigner is attached to your loan, they may remain there until the loan is successfully repaid. If you need a cosigner, you'll need to make sure that he/she is okay this policy. Otherwise, you'll likely need to consider another lender.
Are you willing to work with any participating lenders? As a reminder, LendKey is a student loan marketplace that will compare your rates across a number of different participating lenders. It is possible that you could end up being quoted a low rate with a local credit union or community bank that you have not heard of before. You'll want to make sure you are comfortable with that idea before you proceed.
We like both LendKey and Splash Financial more than other lenders. But in most instances, it makes sense to simply choose the loan that has both the lowest rates and makes the most sense for you.
Conclusion
LendKey is a solid online marketplace that should be considered by borrowers looking to finance their education or refinance existing debt. Their "what you see is what you pay" attitude is desirable for many reasons, as is their network of 13,000+ local lenders.
LendKey's strong online presence, combined with this network of small participating banks and credit unions also increase the chances that you'll find a more personalized customer service experience.
What is your favorite/least favorite part about the LendKey lending experience? Tell us about it in the comments below.
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studentdebtdestroyer.com is not a student loan lender.
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