College Ave vs Sallie Mae: Which private student loan is right for you?

College Ave offers more flexible repayment terms and a streamlined application experience, while Sallie Mae provides faster cosigner release options and broader loan types for different degrees. The right choice depends entirely on your specific priorities—whether you need to customize your monthly payment, secure a loan for a specific type of program, or free a cosigner from obligation as quickly as possible.

This guide compares interest rates, fees, repayment options, eligibility requirements, and unique features to help you decide which lender fits your financial situation. Navigating the gap between federal aid and the total cost of college can be stressful, but understanding the distinct advantages of these two major lenders will empower you to make a confident, cost-effective decision.

Both College Ave and Sallie Mae are industry leaders that offer competitive rates and cover up to 100% of school-certified costs. However, they approach borrower needs differently. By examining them side-by-side, you can identify which lender aligns best with your family’s budget and long-term financial goals.

Context: what matters when comparing private student loan lenders

Before diving into the numbers, it is helpful to understand who these lenders are and what factors drive the decision-making process. Sallie Mae is one of the most established names in student lending, operating since 1972 and transitioning to a fully private bank in 2014. College Ave Student Loans, founded in 2014, is a fintech-focused lender designed to simplify the borrowing experience with modern tools and customization.

When comparing private options, the most critical differentiators are usually interest rates, repayment flexibility, and cosigner policies. For many families, the ability to lower monthly payments during school or release a parent from the loan early can be just as important as the interest rate itself. It is also vital to remember that private student loans are designed to bridge the gap only after you have exhausted all scholarships, grants, and federal student loans.

According to Betsy Mayotte, President of The Institute of Student Loan Advisors, “In general, federal loans should be your first stop, but private loans can be appropriate when you’ve maxed out your federal eligibility.” Once you have utilized those federal resources, comparing private lenders like College Ave and Sallie Mae becomes the next logical step to cover remaining tuition, room, and board costs.

College Ave vs Sallie Mae: side-by-side comparison

To help you make an informed decision, we have compiled the essential data points for both lenders. This table provides a direct comparison of the features that impact your wallet the most, from interest rates to fee structures.

Source: College Ave and Sallie Mae official rate pages (rates and terms current as of October 2024). Lowest rates shown include the 0.25% auto-pay discount.

While the numbers look similar at a glance, the small differences in term lengths and cosigner release policies can have a significant impact on your long-term financial plan. In the following sections, we will break down exactly how these differences play out in real-world scenarios.

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Interest rates and fees explained

Understanding the difference between fixed and variable rates is crucial when reviewing the table above. A fixed rate remains the same for the life of the loan, providing predictable monthly payments and budget stability. This is often the preferred choice for those who want to know exactly what they will owe five or ten years from now. A variable rate may start lower than a fixed rate, but it can fluctuate quarterly based on market conditions. If market rates rise, your interest rate and monthly payment will increase, potentially adding to the total cost of the loan.

The specific rate you are offered within the ranges shown in the comparison table depends heavily on your credit profile (or your cosigner’s). Borrowers with excellent credit scores, stable income, and low debt-to-income ratios typically qualify for the lowest advertised rates. Conversely, those with thinner credit files may see offers toward the higher end of the spectrum. This is why prequalifying with multiple lenders is so important—it allows you to see where you land on that scale without a hard credit check.

Regarding fees, both lenders are consumer-friendly in that they charge $0 origination fees. Some other lenders charge fees ranging from 1% to 5% of the loan amount, which is deducted from the disbursement before it even reaches the school. By avoiding these fees, every dollar you borrow goes directly toward your educational expenses. Furthermore, neither lender charges a penalty for paying off your loan early, meaning you can save on interest by making extra payments whenever possible.

Repayment options: flexibility during and after school

One of the biggest decisions you will make when taking out a private student loan is how to handle payments while the student is still in school. Making payments during school reduces the total amount of interest that accrues and capitalizes (gets added to the principal balance) after graduation. Both College Ave and Sallie Mae offer the standard suite of in-school repayment options:

• Full Deferment: No payments are required while enrolled. Interest continues to accrue and will be added to the loan balance after graduation, increasing the total cost.
• Fixed Payment: You pay a flat fee (usually $25) every month while in school. This helps offset some accruing interest and keeps you in the habit of making payments.
• Interest-Only: You pay the full amount of interest that accrues each month. This prevents the loan balance from growing while you are in school.
• Immediate Repayment: You pay both principal and interest immediately. This option results in the lowest total cost of borrowing but requires the highest monthly commitment during college.

Where College Ave distinguishes itself is in the flexibility of its repayment terms. According to College Ave, borrowers can choose from loan terms of 5, 8, 10, or 15 years. This granular level of choice allows families to fine-tune their monthly payment to fit their specific budget. For example, choosing an 8-year term might offer a slightly lower monthly payment than a 5-year term, but significantly less total interest than a 10-year term.

Sallie Mae typically offers standard terms of 5, 10, and 15 years (varies by loan type). While less customizable than College Ave, these are standard industry terms that work well for most borrowers. Both lenders provide a 6-month grace period after graduation before full principal and interest payments must begin, giving graduates time to find employment and settle into their careers.

Eligibility requirements and cosigner policies

To qualify for a loan with either College Ave or Sallie Mae, you must be a U.S. citizen or permanent resident (or an international student with a qualifying U.S. cosigner) and be enrolled at least half-time at an eligible degree-granting institution. While neither lender publishes a strict minimum credit score, approval is generally contingent on a strong credit history and sufficient income to support repayment.

The reality for most undergraduate students is that they have not yet built enough credit history to qualify for a private loan on their own. Consequently, the vast majority of undergraduate private loans require a creditworthy cosigner, such as a parent, guardian, or relative. This cosigner is equally responsible for the debt, which can be a source of anxiety for families concerned about their debt-to-income ratio or retirement plans. This is where cosigner release policies become a critical differentiator.

According to Sallie Mae, borrowers can apply to release their cosigner after making just 12 consecutive on-time principal and interest payments, provided they meet the credit and income requirements on their own—one of the shortest cosigner release timelines in the industry. This feature is highly attractive for parents who want to help their children secure funding but do not want the debt on their credit report for a decade.

College Ave also offers cosigner release, but according to the lender, borrowers must make 24 consecutive on-time principal and interest payments before they are eligible to apply for release. While still a valuable feature, it keeps the cosigner legally attached to the loan for an extra year compared to Sallie Mae.

According to Mark Kantrowitz, financial aid expert, “Cosigner release is a valuable feature offered by some private lenders, rewarding responsible repayment.” It serves as a goal for students to work toward, incentivizing responsible financial behavior immediately after graduation.

Unique benefits: what sets each lender apart

Beyond the numbers, both lenders offer distinctive perks that cater to different borrower needs. Understanding these “extras” can help tip the scale if the rates and terms look similar.

• Parent Loan Option: Unlike many lenders that only lend to students, College Ave offers a specific loan for parents who want to borrow in their name to help their child, keeping the debt entirely off the student’s credit report.
• Multi-Year Approval: College Ave offers a feature where you can be approved for your entire degree’s estimated cost at once. While you still have to request funds each year, this provides peace of mind that funding is secured for future semesters.
• Customization Tools: Their application interface includes an interactive calculator that lets you see exactly how changing your term length or in-school payment affects your monthly bill and total interest cost in real-time.
• Speed and Simplicity: As a fintech company, their application process is designed to be completed in as little as 3 minutes, with a focus on mobile-friendly user experience.

• Academic Progress Reward: According to Sallie Mae, borrowers of their Smart Option Student Loan in eligible states may qualify for a 0.25% interest rate reduction if they maintain a GPA of 3.0 or higher (terms apply).
• Chegg Study Membership: Borrowers get 4 months of free access to Chegg Study, a service that provides homework help and textbook solutions—a practical perk for students.
• Broad Product Suite: Sallie Mae has specific loan products tailored for very specific needs, including dental school, medical school, bar exam study, and career training programs, which may not be covered by general private lenders.
• Short Cosigner Release: As mentioned, the 12-month release period is a standout feature for families prioritizing financial separation.

Customer service and hardship assistance

When you take out a student loan, you are entering into a relationship that could last 10 to 15 years. Therefore, how a lender treats you when life gets difficult is just as important as the interest rate. Both lenders offer U.S.-based customer support and provide online portals for managing your account.

Regarding financial hardship, both lenders offer forbearance options, though the terms differ. According to Sallie Mae, the lender typically offers up to 12 months of forbearance over the life of the loan, usually granted in 3-month increments. This can be a lifeline if a graduate faces unexpected unemployment or medical issues. College Ave also offers hardship forbearance, but the specific duration and terms are determined on a case-by-case basis depending on the loan agreement.

It is important to note that with almost all private student loans, interest continues to accrue during forbearance periods. This means your balance will grow while you are taking a break from payments. Unlike federal loans, private lenders generally do not offer income-driven repayment plans that tie your monthly bill to your earnings. For this reason, checking reviews regarding customer service responsiveness is wise. College Ave generally receives high marks for its user-friendly digital interface and responsive support, while Sallie Mae’s reputation benefits from its massive infrastructure and resources, though individual experiences can vary.

When to choose College Ave vs Sallie Mae

Making the final call often comes down to prioritizing one or two specific features. Here is a breakdown of scenarios where one lender might be the superior choice for your family.

• You want maximum budget control: The ability to choose an 8-year term instead of being forced into a 5 or 10-year bucket allows you to find the “Goldilocks” payment that fits your monthly budget perfectly.
• You value a fast, digital-first experience: If you prefer managing finances via a sleek mobile interface and want an application that takes minutes, College Ave’s tech-forward approach is ideal.
• You are a parent borrowing for a child: Their dedicated parent loan product allows parents to take on the debt directly, which can be preferable for families who want to spare the student from starting life with a credit burden.
• You want to secure funding for the long haul: The multi-year approval feature reduces the stress of re-applying and worrying about credit checks every single academic year.

• Cosigner release is your #1 priority: If the goal is to get the parent off the loan as soon as possible, Sallie Mae’s 12-month release period is half the time required by College Ave.
• You are a high-achieving student: The Academic Progress Reward can lower your interest rate simply for maintaining good grades, a financial incentive for academic success.
• You are in a specialized program: If you are attending a residency program, studying for the bar exam, or in a career training program, Sallie Mae likely has a specialized loan product designed specifically for your timeline.
• You want study perks: The free Chegg Study membership provides tangible academic support during the semester.

Found your match? Compare personalized rates from College Ave, Sallie Mae, and other top lenders to see your options.

Frequently asked questions

It is possible but difficult for most undergraduates. Both lenders require proof of steady income and a strong credit history, which most students aged 18-22 have not yet established. Graduate students with work history are more likely to qualify independently. Both lenders evaluate your full credit profile to make a decision.

The rates are highly competitive and often overlap significantly. Because your specific rate is determined by your unique credit score and financial history, one lender may offer you a lower rate than the other. The best way to know is to check prequalified rates with both, as this does not impact your credit score.

Sallie Mae offers one of the fastest routes, allowing you to apply for cosigner release after 12 consecutive on-time principal and interest payments. College Ave requires 24 consecutive on-time payments. Both require the primary borrower to meet credit and income criteria at the time of the request.

Yes, you can refinance private student loans with any lender after you graduate. Refinancing can be a smart move if your credit score improves or you secure a higher-paying job, potentially allowing you to lower your interest rate or change your repayment terms.

Both lenders offer a prequalification tool that performs a soft credit inquiry. This allows you to see your estimated interest rates and loan terms without affecting your credit score. A hard credit inquiry, which may temporarily lower your score slightly, is only performed if you proceed to submit a full application.

Conclusion

Choosing between College Ave and Sallie Mae is a good problem to have, as both are reputable lenders offering safe, transparent loan products. Your decision ultimately rests on the nuances of your financial timeline and family goals.

• Both lenders offer competitive rates, $0 origination fees, and cover up to 100% of attendance costs.
• Choose College Ave if you want to customize your monthly payment with flexible term limits (5, 8, 10, or 15 years) and value a streamlined digital experience.
• Choose Sallie Mae if you want to release a cosigner in as little as 12 months or if the student can benefit from GPA-based rate reductions.
• Remember: Always maximize federal student loans first, as they offer protections and income-driven repayment plans that private loans cannot match.
• Next Step: Use the prequalification tools available from both lenders. It takes only minutes and ensures you are making a decision based on real numbers tailored to your profile.

Borrowing for education is an investment in the future. By selecting the lender that offers the right balance of cost and flexibility, you are setting the stage for successful repayment and financial freedom after graduation.

Compare rates from College Ave, Sallie Mae, and 8+ top private lenders. Check your personalized rates in minutes—prequalification won’t affect your credit score.

References and resources

For further research and to verify current details, consider exploring these official and independent resources:

• College Ave Student Loans: Official website for current rates, calculators, and product details.
• Sallie Mae: Official website for current rates, Smart Option Student Loan details, and member benefits.
• StudentAid.gov: The U.S. Department of Education’s portal for federal loan information and comparisons.
• Consumer Financial Protection Bureau (CFPB): Resources for understanding private student loans and borrower rights.
• College Finance: Federal Student Loans Guide
• College Finance: Private Student Loans Comparison
• College Finance: Guide to Student Loan Cosigners