Discover Reviews: Student Loan Refinancing and Private Student Loans

Discover stands out for its generous options for borrowers who are struggling to make payments.
Aug 1, 2022

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Student loan ratings

Discover Undergraduate and Graduate Student Loans
  • Private student loan

  • Student loan refinancing

The bottom line:

Discover Bank, known primarily for its credit cards business, launched Discover Student Loans in 2007. Its refinancing loan is best for borrowers who may need wiggle room on payments, or those who didn’t graduate. Its private loan is best for students who may need wiggle room on payments.

Private student loan review

Discover Undergraduate and Graduate Student Loans

4.5

/5
 NerdWallet rating 
Min. credit score
Does not disclose
Fixed APR
5.49-14.99%
Variable APR
2.99-13.99%
Check rate

on Discover's website

Pros

  • Among the best for payment flexibility.

  • No late fees.

Cons

  • You can’t see if you’ll qualify and what rate you’ll get without a hard credit check.

Best for students who may need wiggle room on payments.

Full Review

Discover's private student loans are a good option for borrowers who want flexible repayment options in case they need wiggle room in the future. Discover offers a wider range of repayment assistance programs compared with other student loan lenders, including the option to temporarily reduce payments.

Discover private student loan at a glance

  • Generous repayment flexibility for struggling borrowers.

  • International students can qualify with a co-signer.

  • Only one repayment term option.

How Discover could improve

Discover could improve its private student loans by:

  • Conducting soft credit checks to give personalized rate estimates.

  • Providing a greater number of repayment schedules.

  • Offering a co-signer release program.

Discover private student loan details

Interest rates, fees and terms
  • Soft credit check to qualify and see what rate you’ll get: No.

  • Loan amounts: $1,000 minimum. Borrow up to 100% of school-certified cost of attendance — including tuition, housing, book and more — minus financial aid. Aggregate loan limits apply.

  • Application or origination fee: No.

  • Prepayment penalty: No.

  • Late fees: No.

Compare Discover's range of interest rates with other private student loan lenders. Your actual rate will depend on factors including your — or your co-signer's — credit history and financial situation. To see what rate Discover will offer you, apply on its website.

Requirements

Financial

Discover doesn’t disclose specific details about what it takes to qualify for its student loans, but there’s a good chance you’ll qualify if you are at least 16 years old and have good credit or apply with a co-signer who does. Discover also considers other factors, such as area of study and potential income.

  • Minimum credit score: Did not disclose.

  • Minimum income: Did not disclose.

  • Typical credit score of approved borrowers or co-signers: Did not disclose.

  • Typical income of approved borrowers: Did not disclose.

  • Maximum debt-to-income ratio: Did not disclose.

  • Can qualify if you’ve filed for bankruptcy: Yes; you’re more likely to qualify if the bankruptcy isn’t recent.

Other

  • Citizenship: Must be a U.S. citizen or permanent resident. International students are eligible if they apply with a co-signer who is a U.S. citizen or permanent resident.

  • DACA Borrowers: Only eligible with a co-signer who is a US Citizen or permanent resident.

  • Location: Available to borrowers in all 50 U.S. states.

  • Must be enrolled half-time or more: Yes.

  • Loan can be used for past due tuition: No.

  • Types of schools served: Must attend a school authorized to receive federal aid.

  • Percentage of borrowers who have a co-signer: Did not disclose.

Repayment options

Many lenders are offering relief related to COVID-19. Check this list of private loan relief options to see what this lender offers.

    In-school repayment options

    • Immediate: Begin making full monthly payments as soon as the loan is disbursed. This option will save you the most in interest.

    • Interest-only: Make monthly interest payments while you're in school and during your grace period. You'll get a 0.35% interest rate discount for choosing this option (*Visit Discover.com/student-loans/help/interestonly for terms and conditions). Interest-only repayment option is available for undergraduate, graduate, health professions, law and MBA loans. It does not apply to parent loans or student loan refinance.

    • Fixed: Make fixed, $25 payments while you’re in school and during your grace period.

    • Full in-school deferment: Yes. You won’t be required to make any payments until your grace period ends, but you can choose to make payments if you’d like.

    Post-school repayment options

    • Grace period: For borrowers who defer payments while in school, the grace period ends 6 months after graduation or after enrollment drops below half-time.

    • Income-based repayment option: No.

    • In-school deferment: Yes, monthly payments are not required until 6 months after you graduate or your enrollment drops below half-time.

    • Academic deferment: Postpone payments if you return to school at least half-time.

    • Military deferment: Postpone payments if you're on active military duty.

    • Public service deferment: Postpone payments if you're serving in a qualified public service organization.

    • Medical residency deferment: Postpone payments during your medical residency.

    • Grace period extension: Discover offers an Early Repayment Assistance Program that can extend your grace period. This program lets borrowers postpone payments for three months, but you must be in the first three months of repayment to be eligible.

    • Forbearance: Postpone payments for up to 12 months if you're experiencing unemployment, economic hardship, an excessive student loan burden or a medical disability. Borrowers cannot receive 12 months of forbearance consecutively.

    • Temporary interest rate reduction: Get a lower interest rate, resulting in a lower monthly payment, for up to 12 months. Payments are subject to a $50 minimum per month.

    • Temporary payment reduction: Pay just the interest on their loan, subject to a $50 minimum, for up to six months. The loan must be fewer than 60 days late to qualify.

    • Co-signer release available: No.

    • Death or disability discharge: Yes.

    • Loan discharge if co-signer dies or becomes disabled: No.

    Repayment preferences

    Customer service
    • Loan servicer: Discover.

    • In-house customer service team: Yes.

    • Process for escalating concerns: Yes.

    • Borrowers get assigned a dedicated banker, advisor or representative: No.

    • Average time from application to approval: Students can apply in 15 minutes or less. It can take two weeks for approval because of the required paperwork and waiting times.

    Extras
    • Reward for good grades: Get a cash reward on each new Discover undergraduate and graduate student loan when you earn at least a 3.0 GPA (or equivalent) in any academic period covered by the loan. Limitations Apply. Visit DiscoverStudentLoans.com/Reward for terms and conditions.

    What Discover wants you to know

    To qualify, the borrower must:

    • Be at least 16 years old at the time of loan application. Cosigner required if under 18.

    • Be a US Citizen, permanent resident or international student (International students require a creditworthy cosigner who is a US Citizen or permanent resident).

    • Pass a credit check.

    • Be enrolled at least half-time and making satisfactory academic progress in a Bachelor's or Associate's degree program at an eligible school.

    Students may have the option to apply for a Discover student loan with a creditworthy cosigner. Applying with a creditworthy cosigner may improve the likelihood for loan approval and may provide a lower interest rate. To qualify, the cosigner must:

    • Be at least 18 years old at the time of loan application.

    • Be a US Citizen or permanent resident.

    • Pass a credit check.

    Discover Student Loans offers three different repayment options:

    • In-School Interest-Only Repayment: Students can elect, during the application process, to make interest-only monthly payments while in school and during the grace period to lower overall loan cost and receive a 0.35% interest rate discount. (*Visit Discover.com/student-loans/help/interestonly for terms and conditions.)

    • In-School Fixed Repayment: Students can elect, during the application process, to make $25 fixed, monthly payments while in school and during the grace period to lower overall loan cost.

    • Deferred Repayment: Students can choose to have payments deferred, which means no payments are due until 6 months after graduation for undergraduate loans (9 months for graduate loans) or enrollment drops below half-time.

    The fixed interest rate is set at the time of application and does not change during the life of the loan unless you are no longer eligible for one or more discounts. The variable interest rate and corresponding APR may increase over the life of the loan. The variable interest rate is calculated based on the 3-Month CME Term SOFR index plus the applicable margin percentage less any applicable discounts. The 3-Month CME Term SOFR index value for variable interest rate loans is 2.00% as of July 1, 2022. 3-Month CME Term SOFR is administered by CME Group and is published by CME Group on its website (cmegroup.com/termsofr). Discover Student Loans may adjust the variable interest rate quarterly on each January 1, April 1, July 1 and October 1 (each an “interest rate change date”), based on the 3-Month CME Term SOFR rate available for the day that is 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125), or 0%, whichever is greater. This may cause the monthly payments to increase, the number of payments to increase or both. If the 3-Month CME Term SOFR rate is less than zero percent, then the index will be deemed to be zero percent (as stated in the promissory note) for purposes of calculating your interest rate. Your variable interest rate (index + margin – applicable discounts) will not exceed 18%. Our lowest APRs are only available to applicants with the best credit. The APR will be determined after an application is submitted. It will be based on credit history, the selected repayment option and other factors, including a cosigner’s credit history (if applicable). If a student does not have an established credit history, the student may find it difficult to qualify for a private student loan on their own or receive the lowest advertised rate. Learn more about Discover Student Loan rates at DiscoverStudentLoans.com.

    Before applying for a Discover student loan

    Before taking out a Discover student loan or any other private student loan, exhaust your federal student loan options first. Submit the Free Application for Federal Student Aid, known as the FAFSA, to apply.

    Compare your private student loan options to make sure you’re getting the best rate you qualify for. In addition to interest rates, look at lenders’ repayment alternatives and the flexibility they offer to borrowers who struggle to make payments.

    If you aren’t eligible for a Discover student loan

    If Discover denies your student loan application, the lender will let you know why. Depending on the reason, you may want to consider other lenders or, if you haven’t already, try applying with a co-signer.

    If you don’t have access to a co-signer — or still aren’t eligible with one — consider lenders that don’t require co-signers or specialize in bad or no credit student loans.

    STUDENT LOAN RATINGS METHODOLOGY

    Our survey of more than 29 banks, credit unions and online lenders offering student loans and student loan refinancing includes the top 10 lenders by market share and top 10 lenders by online search volume, as well as lenders that serve specialty or nontraditional markets.

    We consider 40 features and data points for each financial institution. Depending on the category, these include the availability of biweekly payments through autopay, minimum credit score and income requirement disclosures, availability to borrowers in all states, extended grace periods and in-house customer service.

    The stars represent ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

    How does this loan compare?

    Discover Undergraduate and Graduate Student Loans
    Earnest Private Student Loan
    College Ave Private Student Loan
    NerdWallet rating 
    NerdWallet rating 
    NerdWallet rating 
    Min. credit score

    Does not disclose

    Min. credit score

    650

    Min. credit score

    Mid-600s

    Fixed APR

    5.49-14.99%

    Fixed APR

    3.22-12.78%

    Fixed APR

    3.22-13.95%

    Variable APR

    2.99-13.99%

    Variable APR

    1.34-11.44%

    Variable APR

    1.29-12.99%

    Student loan refinancing review

    Discover Student Loan Refinance
    Discover Student Loan Refinance

    5.0

    /5
     NerdWallet rating 
    Min. credit score
    Does not disclose

    Pros

    • No late fees.

    • More flexible repayment options for struggling borrowers than other lenders.

    • Can refinance without a degree.

    Cons

    • Only two repayment terms available.

    • No co-signer release available.

    • You can't see if you’ll qualify and what rate you’ll get without a hard credit check.

    Best for borrowers who may need wiggle room on payments, or those who didn't graduate.

    Full Review

    Refinancing student loans through Discover is a good option for financially strong borrowers who may need wiggle room in the future. Discover offers a wider range of repayment assistance programs compared with other student loan refinance lenders, including the option to temporarily reduce payments.

    Discover student loan refinancing at a glance

    How Discover could improve

    Discover could improve its student loan refinance product by:

    • Conducting soft credit checks to give personalized rate estimates.

    • Providing a greater number of repayment schedules.

    • Offering a co-signer release program.

    Discover student loan refinancing details

    Interest rates, fees and terms
    • Soft credit check to qualify and see what rate you’ll get: No.

    • Loan terms: 10 or 20 years.

    • Loan amounts: Minimum amount $5,000. Consolidate up to the aggregate amount of your education loan debt. Maximum limit of $150,000 applies.

    • Can transfer a parent loan to the child: No.

    • Application or origination fee: No.

    • Prepayment penalty: No.

    • Late fees: No.

    Compare Discover’s range of interest rates with other student loan refinance lenders. Your actual rate will depend on factors including your — or your co-signer’s — credit history and financial situation. To see what rate Discover will offer you, apply on its website.

    Requirements

    Financial

    Discover doesn’t disclose specific details about what it takes to qualify for its student loans. Borrowers must be 18 years old, pass a credit check, have a positive credit history and have enough income to afford their debts.

    • Minimum credit score: Did not disclose.

    • Minimum income: Did not disclose.

    • Typical credit score of approved borrowers or co-signers: Does not disclose.

    • Typical income of approved borrowers: Did not disclose.

    • Maximum debt-to-income ratio: Did not disclose.

    • Can qualify if you’ve filed for bankruptcy: Yes, though you’re more likely to qualify if the bankruptcy isn’t recent.

    Other

    • Citizenship: Must be a U.S. citizen or permanent resident.

    • Location: Available to borrowers in all 50 U.S. states.

    • Must have graduated: No.

    • Must have attended a school authorized to receive federal aid: Yes.

    • Percentage of borrowers who have a co-signer: Did not disclose.

    Repayment options

    Many lenders are offering relief related to COVID-19. Check this list of private loan relief options to see what this lender offers.

    • Academic deferment: Postpone payments if you return to school at least half-time.

    • Military deferment: Postpone payments if you're on active military duty.

    • Public service deferment: Postpone payments if you're serving in a qualified public service organization.

    • Medical residency deferment: Postpone payments during your medical residency.

    • Forbearance: Postpone payments for up to 12 months if you're experiencing unemployment, economic hardship, an excessive student loan burden or a medical disability. Borrowers cannot receive 12 months of forbearance consecutively.

    • Temporary interest rate reduction: Get a lower interest rate, resulting in a lower monthly payment, for up to 12 months. Payments are subject to a $50 minimum per month.

    • Temporary payment reduction: Pay just the interest on your loan, subject to a $50 minimum, for up to six months. The loan must be less than 60 days late to qualify.

    • Co-signer release available: No.

    • Death or disability discharge: Yes.

    • Loan discharge if co-signer dies or becomes disabled: No.

    Repayment preferences

    • Allows greater-than-minimum payments via autopay: Yes.

    • Allows biweekly payments via autopay: Yes.

    Customer service
    • Loan servicer: Discover.

    • In-house customer service team: Yes.

    • Process for escalating concerns: Yes.

    • Borrowers get assigned a dedicated banker, advisor or representative: No.

    • Average time from approval to payoff: 30 to 45 days after a borrower applies.

    What Discover wants you to know

    To qualify, the borrower must:

    • Be a US citizen or permanent resident with a US-based address.

    • Be at least 18 years old at the time of loan application.

    • Pass a credit check.

    • Have no more than $150,000 in aggregate student loan debt. Higher limits may apply for specific fields of study.

    • Have verifiable income sufficient to support your debts and show a positive repayment history.

    • Be the primary borrower on the loans you want to consolidate.

    The fixed interest rate is set at the time of application and does not change during the life of the loan unless you are no longer eligible for one or more discounts. The variable interest rate and corresponding APR may increase over the life of the loan. The variable interest rate is calculated based on the 3-Month CME Term SOFR index plus the applicable margin percentage less any applicable discounts. The 3-Month CME Term SOFR index value for variable interest rate loans is 2.00% as of July 1, 2022. 3-Month CME Term SOFR is administered by CME Group and is published by CME Group on its website (cmegroup.com/termsofr). Discover Student Loans may adjust the variable interest rate quarterly on each January 1, April 1, July 1 and October 1 (each an “interest rate change date”), based on the 3-Month CME Term SOFR rate available for the day that is 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125), or 0%, whichever is greater. This may cause the monthly payments to increase, the number of payments to increase or both. If the 3-Month CME Term SOFR rate is less than zero percent, then the index will be deemed to be zero percent (as stated in the promissory note) for purposes of calculating your interest rate. Your variable interest rate (index + margin – applicable discounts) will not exceed 18%. Our lowest APRs are only available to applicants with the best credit. The APR will be determined after an application is submitted. It will be based on credit history, the selected repayment option and other factors, including a cosigner’s credit history (if applicable). If a student does not have an established credit history, the student may find it difficult to qualify for a private student loan on their own or receive the lowest advertised rate. Learn more about Discover Student Loan rates at DiscoverStudentLoans.com.

    Before refinancing with Discover

    Before deciding on a student loan refinance lender, compare multiple student loan refinance options to make sure you’re getting the best rate you qualify for. In addition to interest rates, compare lenders’ repayment options and the flexibility they offer borrowers who are struggling to make payments.

    If you aren’t eligible to refinance with Discover

    If Discover denies your refinance application, the lender will let you know why. Depending on the reason, you may want to consider other lenders or need a co-signer.

    NerdWallet recommends prequalifying with multiple refinance lenders before you apply. This will let you know which lenders you may be eligible with, without affecting your credit.

    STUDENT LOAN REFINANCE RATINGS METHODOLOGY

    Our survey of more than 29 banks, credit unions and online lenders offering student loans and student loan refinancing includes the top 10 lenders by market share and the top 10 lenders by online search volume, as well as lenders that serve specialty or nontraditional markets.

    We consider 41 features and data points for each financial institution. Depending on the category, these include the availability of biweekly payments through autopay, minimum credit score and income requirement disclosures, availability to borrowers in all states, extended grace periods and in-house customer service.

    The stars represent ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.

    Frequently asked questions