Are you a graduate carrying around a significant amount of student loan debt? Maybe you’re just beginning your college journey and are struggling to find additional financing.
You could use some relief.
Debt impacts your life in so many ways. Everything is more stressful with a financial burden hanging over your head. The Federal Reserve reports the average person in 2017 had between $20,000 and $25,000 in student loan debt. Of those, the typical monthly payment falls between $200 and $300. That’s a big chunk of change!
If you’re stuck paying that with high interest and low flexibility, it could stop you from living a life you love. After all, how can you buy your dream house, save for retirement, or travel the world with so much debt?
Luckily, you have options. For help getting a new student loan or refinancing an old one, CommonBond might be the answer.
Instead of stressing over student loans and refinancing, CommonBond might lower your money payment and save you money on interest. Wouldn’t that be great?
In this CommonBond review, we’ll look at student loan and refinancing options that CommonBond offers. Let’s see if they’re a good fit to help you with your student loans!
CommonBond at a Glance
- Founded in 2012 to combat high student loan interest rates
- 1-for-1 Social Promise supports education of children in need
- Named one of TIME’s 50 Genius Companies in 2018
- Private loans for undergrad, graduate, MBA, dental, medical, and refinancing
- Checking rates won’t impact your credit score
- Allows up to 24 months of forbearance
- No prepayment penalties
What is CommonBond?
CommonBond is an online lender that focuses on getting you the best interest rate and service for student loans. They provide both refinancing and private student loans.
If you’re looking to cut down on student loan payments and interest, one of your best options is to refinance your existing student loan. This pays off your old student debt and replaces it with a new loan.
But that’s just one piece of the puzzle. CommonBond also simplifies the process of taking out private student loans to fund your education. If you’re looking at undergraduate, graduate, or a professional track in medical or dental school, CommonBond has a no-nonsense approach to help you.
They also have a strong social component. Pencils of Promise is a partner program that builds classrooms and brings teachers and tech to the developing world. So far, CommonBond has sent over $1 million to young students in need.
Loans Available through CommonBond
Getting a loan with CommonBond is easy, beginning with their simple forms. Here are the loans available with them and a breakdown of what each offers.
Undergraduate Student Loans
If you’re looking to pursue an undergraduate degree, a private student loan from CommonBond can help you get there. It’s simple to apply and there’s no fee. Interest rates start at 3.34% APR for a variable rate loan and 4.49% APR for a fixed-rate loan.
CommonBond lets you add a cosigner to your loan so don’t worry if you don’t have perfect credit. This is pretty routine since most students don’t have the income or credit history built up to qualify on their own. A cosigner can be a parent, grandparent, other family member, or even a friend who can help you get the money you need for your degree. Normally cosigning a loan is a lengthy commitment. But with CommonBond, you can apply to release them after just two years of on-time payments!
When it comes to repaying, you’ll have a variety of options to pick from. And if you fall on hard times and need a break from paying your student loans, they offer postponed payments for up to 12 months.
Graduate and MBA Student Loans
Ready to take the leap into a graduate or MBA program? Your life might be very different from what it was when you pursued your undergraduate degree.
Having a more established income and credit rating at this point means you’re less likely to need a cosigner, but you still have the choice to add one. Sometimes, a cosigner can help you qualify for a better interest rate. And, you can always ask to have them removed from your loan after two years of on-time payments.
Life can throw curveballs and financial trouble can sneak up on you when you least expect it. As with undergraduate loans, you have the option of postponing payments for up to 12 months.
Dental Student Loans
Are you going to dental school? Congratulations! Dental school is quite unique from other programs. With input from members of the American Student Dental Association, CommonBond put together a loan to meet the specific needs dental students.
For instance, you can fully defer payments while you focus on your residency. Plus, your loans have a six-month grace period. That way, you can settle into your new career without worrying about your dental student loans.
You can pick from either a variable or fixed rates, and – again – checking your rate won’t hurt your credit, so there’s no harm in seeing what you might get. The rates you receive will depend on your credit and whether you pick a fixed or variable loan.
Medical Student Loans
Enrolling in medical school is a big commitment, and student loans can add up fast. CommonBond might not be your best option if you’re planning to take advantage of the Public Service Loan Forgiveness program. For that, federal student loans are a better choice. But, the flexibility in this private student loan might fit your needs.
If you’re looking into a residency program, it’s nice to know your medical student loan from CommonBond won’t weigh you down. You can reduce your payments during residency, including internships, fellowships, and research. And while you can’t completely defer payments, they can go down to as little as $100 a month to make it easier on your budget. You can still pause payments for up to 12 months, and unlike most other loans, there is no requirement for a cosigner.
Student Loan Refinancing
If you’re already out of school or pursuing a different degree, you may be interested in refinancing your past student loans to save money. Refinancing can help pay down your student debt and accomplish other financial goals.
If you have a decent income and good credit score, CommonBond may be able to lower the interest rate of your current loans. They also offer a unique hybrid loan. Considering the U.S. Department of Education lists rates as high as 7.6% APR for some direct loans, you may be able to save big. Based on interest savings alone, refinancing your federal student loans through CommonBond could significantly drop your monthly payment.
Remember, refinancing isn’t just for federal loans. You can do it with private loans, too. Getting started is straightforward, and it only takes a few minutes to see the rate you qualify for. Checking your options won’t impact your credit score and there’s no commitment.
Benefits of Using CommonBond
- Simple process – The application is straightforward and easy to understand. You’ll start with basic information such as type of loan you want and what school you plan to attend. If you can’t complete your application in one sitting, it’s easy to save it and pick it up later.
- Flexible repayment options – Terms of 5, 7, 10, 15, and 20 years are available depending on the type of loan financed. CommonBond offers fixed, variable, and even hybrid rates. Most loans offer a deferment of up to 12 months but up to 24 months is possible with some loans.
- Interest rate discount – When it’s time to repay your student loan, you have the option to use auto-pay. This lets you “set it and forget it”. The biggest incentive is that it cuts your interest rate by 0.25%, saving you tons of money over the life of your loan!
- Won’t hurt your credit score – CommonBond does a soft credit pull during the application process, so it doesn’t affect your credit score. This allows you to see real rates based on your actual credit history. Once you decide to apply, they will do a hard pull on your credit.
- Helpful support – You’re likely to have tons of questions when refinancing or applying for a new student loan. CommonBond anticipates that and pairs you with a Money Mentor. Through text messaging, you’ll talk to a real person who can help you get the answers you need.
- Social impact – CommonBond maintains a partnership with Pencils of Promise, a non-profit founded in 2008 that helps provide educational funding in developing countries. So far, CommonBond has donated over $1M in funding to disadvantaged students.
Where CommonBond Falls Short
If there’s one thing CommonBond does well, it’s student loans. Of course, nothing is perfect, and there are a few drawbacks.
The most obvious is that it might not actually save you any money. Refinancing has the potential to save you thousands – even tens of thousands – over the life of the loan. If your credit is crummy, however, your interest rate might not be that great. It doesn’t make sense to refinance if you end up paying the same or (gasp) even more!
Refinancing your federal loans into a private student loan isn’t always a smart idea, either. You could lose benefits that come with federal student loans – such as income-based repayment or Public Service Loan Forgiveness. If you plan on taking advantage of one of these programs, think twice about getting a private loan.
For those taking out a new student loan, getting approved without a cosigner can be tough. A recent Private Student Loan Report by MeasureOne found nearly 92% of new undergraduate private student loans had a cosigner. That’s because part of the decision rests with your credit score and young applicants frequently don’t have enough credit history to qualify.
CommonBond claims there are no hidden fees, but if you read the fine print, many of their loans have a 2% origination fee. If you’re refinancing or taking out a new undergraduate loan, you can avoid this cost. But reading the disclaimer page clearly shows an origination fee applies to many of the graduate school loans they offer. Be sure to read all disclosures and documents so you know what you’re getting into.
Who Should Use CommonBond?
Private student loan borrowers – If you already have private student loans and are looking to refinance, CommonBond could lower your interest rate and save you some cash. It also works to simplify your monthly budget by turning your multiple student loans into one single payment.
Current students needing more money for school – Grants, scholarships, and federal student loans aren’t always enough. CommonBond is a great choice if you have some expenses left to cover after exhausting other financing options.
Future medical and dental students – CommonBond lets you defer or reduce your monthly payment obligation during residency programs, and that can be a big help to your budget. Applying for a medical or dental student loan is quick and painless and is worth checking out.
Who Should Avoid CommonBond?
- Federal borrowers eligible for repayment assistance – It doesn’t always make sense to refinance your federal student loan. When you do, you lose out on federal borrower protections like income-driven repayment, forbearance, and Public Service Loan Forgiveness. Think carefully before refinancing your federal student loans and consider consolidating them instead.
- Anyone with poor credit and no cosigner – New student loan borrowers don’t often meet the credit history or income requirements to qualify. If you add a cosigner, it can increase your chances of being approved and get you a lower interest rate. But without one, you’re likely to either not qualify or have a very high interest rate. If you’re struggling to get approved, check out a site like Credible instead.
CommonBond Review: The Bottom Line
CommonBond is a top-rated choice for taking out or refinancing student loans.
Most college students will likely need a cosigner but the option to remove them after just two years of on-time payments is helpful. Additionally, working with CommonBond can open up flexible repayment opportunities. Plus, knowing your loan is helping to fund the tuition of a disadvantaged student is something you can feel good about.