Among Rhode Island’s members of the college class of 2018, 63% left school with student loans — at an average of $36,036. So if you’re heading to university in the Ocean State, you might be exploring your options for Rhode Island student loans.
As long as you shop around for a low rate and avoid borrowing too much, a student loan could be a useful tool for paying for college. But make sure first to exhaust your options for grants and scholarships before you take on debt.
To help you navigate the process, we’ve collected your best options for Rhode Island student loans, as well as refinancing options if you already have such loans:
Getting Rhode Island student loans
Federal student loans
The federal government offers loans to undergraduate and graduate students, as well as to parents who want to help their children pay for school. Federal student loans offer some benefits that you won’t see with private student loans, including forgiveness programs and income-driven repayment (IDR) plans.
Direct subsidized loans and Direct unsubsidized loans don’t require a credit check of borrowers before they’re approved, but Direct PLUS loans do.
Here’s a summary of what’s available, as of July 16, 2020. For the most recent information, contact the Federal Student Aid office.
|Loan type||Designed for||Requires a credit check?||Interest rates||Loan fee|
|Direct Subsidized Loans||Undergraduate students who demonstrate financial need||No||2.75%||1.059%|
|Direct Unsubsidized Loans||Undergraduate, graduate and professional students||No||2.75% for undergraduates, 4.30% for graduate and professional students||1.059%|
|Direct PLUS Loans||Graduate and professional students and parents of undergraduate students||Yes||5.30%||4.236%|
Private student loans
Unlike federal loans, all private student loans require a credit check of borrowers. If you’re brand new to credit or have made some mistakes, you might need to get a cosigner to improve your chances of being approved.
In addition, private student loans don’t typically come with student loan forgiveness programs or IDR plans. Despite these drawbacks, the top private student loan companies offer competitive interest rates and terms to borrowers who qualify. Here are a few examples.
|Student loan company||Variable interest rates||Fixed interest rates||Origination fees|
|LendKey||2.61% – 5.25%||3.19% – 7.75%||None|
|Citizens Bank||2.49% – 8.38%||3.20% – 8.63%||None|
|College Ave||3.64% – 8.99%||3.74% – 8.99%||None|
RISLA student loans
Rhode Island Student Loan Authority (RISLA) is a nonprofit quasi-state agency that offers college loans and student loan refinancing. You don’t need to be a Rhode Island resident to qualify for a RISLA loan, but borrowers who live, work or went to school in Rhode Island might get a lower rate.
Students and parents can take out a RISLA student loan for undergraduates, while graduate students can borrow a RISLA graduate student loan.
Unlike private student loan companies, RISLA offers special benefits to its borrowers. For example, you can get on an income-based repayment plan if you can’t afford your payments. You also will have access to the following programs:
- Student Loan Forgiveness for Internships: You can access up to $2,000 in student loan forgiveness on nonfederal RISLA loans for completing an eligible internship for credit.
- Nursing Rewards: If you’re a new nurse working in Rhode Island, you’ll pay no interest on RISLA loans for up to four years.
- Health Professionals Loan Repayment Program: If you’re a primary care provider, you could get thousands of dollars in loan forgiveness by staying and working in Rhode Island.
To be eligible for a RISLA loan, you need to earn at least $40,000 a year and meet a credit requirement. If you don’t meet these requirements, you can use a cosigner who does meet the criteria to help you get approved.
Here are some details about these Rhode Island student loans, as of July 16, 2020. Check the RISLA website for the latest information.
|Undergraduate and graduate loans||Parent loans|
|Payment plan||Immediate repayment plan||Deferred repayment plan||Immediate repayment plan|
|Fixed APR (with autopay)||3.99%||5.08% (undergraduate)/5.20% (graduate)||4.99%|
|Repayment term||120 months||180 months||120 months|
|Repayment begins||15 days after final disbursement||6 months after you leave school||15 days after final disbursement|
|Loan limits||$1,500 to $45,000 per year||$1,500 to $45,000 per year|
Refinancing Rhode Island student loans
If you’ve already left school, it might be worth taking another look at your student loans to make sure you’re not paying more than you should. Refinancing your Rhode Island student loans could potentially get you a lower interest rate, monthly payment or both.
Private student loan refinancing companies typically offer variable and fixed interest rates, whereas RISLA only offers a fixed rate option.
Here are a few of the top student loan refinancing companies and how they compare with RISLA.
|Student loan company||Variable interest rates||Fixed interest rates|
|CommonBond||3.18% – 6.06%||3.19% – 5.99%|
|Earnest||1.99% – 5.64%||2.98% – 5.79%|
|SoFi||1.99% – 6.24%||2.99% – 6.24%|
|RISLA||N/A||Starts at 3.49% (as of July 16, 2020)|
Be sure to compare various student loan refinancing companies and examine repayment terms and other features that might fit your needs best.
How Rhode Island student loans fit in the bigger picture
Ideally, you shouldn’t need to take out student loans to pay for college. But having access to different options when you need them can help you avoid paying more than you have to for your education.
As you research your student loan options, keep other financing methods in mind, including scholarships, grants and jobs. The more time you spend trying to get funds from these sources, the less you’ll need to borrow.
If you do end up taking out student loans, make sure to look into refinancing the debt when you graduate. Depending on what you’re paying, you could get a better deal.
Rebecca Safier contributed to this report.
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