Private Student Loan Question! (Rates, LIBOR, Prime?)

<p>Hello everyone,</p>

<p>I needed to take out private student loans to fund some of my education costs, a total of $40,000 for my entire program (one year program, so $40,000 at once from a private lendor).</p>

<p>I shopped around and applied for a few different student loans, and ended up with quite a range of APRs and loan terms. All have no fees attached, but as for terms I have:</p>

<ol>
<li>LIBOR + 4.75% with 25 year repayment term (currently comes to 5%)</li>
<li>LIBOR + 6.7% with 15 year repayment (currently comes to 7%)</li>
<li>LIBOR + 7% with 15 year repayment (currently comes to around 7.25%)</li>
<li>PRIME + 4.75% with 15 year repayment (currently comes to 8%)</li>
</ol>

<p>Now, obviously the first is the best, with a long repayment term and low interest...but I may have issues with that one, as they have to decide whether or not to give me special permission for that loan (Co-signer needed 2 years previous employment, and he misses that mark by less than 13 days). If they ok it, I will take that one for sure.</p>

<p>So with that one out, the other three are fairly similar. I would pick #2 over #3 simply because they have the same terms but #3 has a higher margin...but then I'm not sure about #4. RIGHT NOW, it's currently higher, about 1% higher. But it is pegged to Prime, while the others are pegged to LIBOR. I don't know which one is a safer bet right now, which one is more likely to go up...so I was wondering if anyone has advice as to which of these options is best, if option 1 doesn't pan out.</p>

<p>Anyone have any idea?</p>

<p>There's some info on LIBOR and Prime here, although the page looks a little old:
FinAid</a> | Loans | Spread between PRIME and LIBOR</p>

<p>Can you tell us which lender is #1? We're currently shopping these, too.</p>

<h1>1 came from using an awsome website called: Overture Student Loan Marketplace.</h1>

<p>You put your info in and they find student loans for you and show terms you would get based on your credit report. You pick one and apply, and the terms closely mirror what Overture showed. In my case, my APR was actually a little lower when I applied.</p>

<p>The loan from #1 is Eli Lilly Federal Credit Union, you have to be a member of the credit union to apply, but the terms are great. Like I said, try Overture.</p>

<p>I am checking out ther site now. How did you make out with Overture?</p>

<p>I went on overture and applied for student with co sign loan and came back with similar results with the Eli Lilly which has an A+ rating from the BBB. </p>

<p>In reading the fine print i see they are not the actual lender and thay are not giving a guarantee of loan so you have o go to ELI LILLY and apply and then overture gets a cut.</p>

<p>Does anyone have a sense of what repayment opion is best? defferred? interest only now? or immediate repay? THANKS! :)</p>

<p>
[quote]
You put your info in and they find student loans for you and show terms you would get based on your credit report.

[/quote]
</p>

<p>I'm skeptical of this claim. The lenders don't divulge to anyone how they arrive at rates for any given applicant. They have super-secret proprietary formulas for this, and the only way to find out what what you'd get is to apply. Even then, they will not tell you the reason for the rate they give you.</p>

<p>I will be applying for a loan from Eli lilly for our son and will let you know how I make out. I understand Overture gets a cut for referring people.</p>