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Funding U student loans review: Lender doesn’t allow cosigners and bases decisions on academic success

The lowest rate on Funding U's student loans is 7.49%, significantly higher than competitors. Funding U doesn't offer variable-rate or graduate loans. ...
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Pros and cons

Pros Cons
  • No origination fee, prepayment penalty, or late fee
  • Loans aren't based on creditworthiness
  • Low maximum loan amount
  • Customer support only available via email
  • Relatively high interest rates
  • One repayment term option
  • Loans aren't available for residents of 19 states
  • No graduate student loans
  • No variable-rate loans

Funding U undergraduate student loans

Funding U Undergraduate Student Loans

Funding U Undergraduate Student Loans doesn't have the best rates on its undergraduate student loans, with a much higher minimum APR than other private student loan lenders. The company also doesn't offer variable-rate loans, so you'll have to take a fixed-rate loan with the business.

Funding U doesn't make lending decisions solely based on creditworthiness. It will also consider factors like your academic performance and future potential career success when choosing to offer you a loan.

Funding U won't charge any origination, prepayment, late, or application fees. You must take out a loan with a 10-year repayment term.

How Funding U compares

Funding U Undergraduate Student Loans has high minimum rates compared to its competitors. Here's how Funding U compares:

Funding U Student Loans Logo

Earnest logo

discover bank logo

Undergraduate APR

Funding U Undergraduate Student Loans

Undergraduate APR

Earnest Undergraduate Student Loans

Undergraduate APR

Discover Undergraduate Student Loans

Fees

None

Fees

None

Fees

None

Funding U Undergraduate Student Loans Earnest Undergraduate Student Loans

Discover Undergraduate Student Loans

Funding U has a higher APR range than both Earnest and Discover. You can also only get fixed-rate loans with Funding U, while the other two lenders offer a variable-rate option. You won't pay fees with any of the lenders.

Earnest and Discover both allow cosigners, while Funding U doesn't. At the same time, Funding U's unique lending process may make it easier for you to get a loan with the company than with another one.

How Funding U student loans work

Funding U offers undergraduate student loans but no graduate loans. You can't apply with a cosigner, and your loan eligibility is based on a proprietary system developed by Funding U that takes into account your collegiate academic success, likelihood to graduate on time, and total loan debt, among other factors.

You should go after federal student loan options before considering private student loan, including one with Funding U, as you can usually get better terms and protections through the government.

Loans aren't available for residents of Alabama, Alaska, Delaware, Idaho, Kentucky, Louisiana, Maine, Minnesota, Mississippi, Montana, Nevada, New Hampshire, North Dakota, Oklahoma, Rhode Island, South Dakota, Utah, Washington, or Wyoming.

If you want to contact Funding U's customer support, you must reach out to them via email.

What options do I have to repay my loans?

You only have two options to repay your student loans with Funding U: fixed and interest-only payments. The better repayment plan depends on your situation.

Fixed Interest-only
  • Pay $20 per month while in school and during a six-month grace period
  • Unpaid interest accrues
  • Interest is capitalized at the end of grace period
  • Low in-school payments
  • Pay loan's interest monthly while in school and during a six-month grace period
  • Higher in-school payments
  • You'll get a 0.5% interest rate discount with an interest-only loan

Fixed payments will be more expensive than interest-only payments because interest will accrue during school and your grace period. You'll also get a rate discount with interest-only loans.

Is Funding U trustworthy?

Funding U Undergraduate Student Loans has received an A+ in trustworthiness from the Better Business Bureau. The BBB measures trustworthiness by evaluating business' replies to consumer complaints, truthfulness in advertising, and clarity about business practices.

You aren't guaranteed to have a good relationship with Funding U simply because the business has a high BBB rating. Ask with your friends and family about their experiences with the lender and read what other customers are saying about the company.

Funding U doesn't have a history of any scandals, so you may decide you're comfortable borrowing from the lender.

Related Content Module: More on Loans

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