Funding U Review: Private Student Loans
To borrow from Funding U, you don’t need to meet a credit score or minimum income requirement, nor do you need a co-signer: just a GPA of at least 2.5.
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- 19 student loans lenders reviewed and rated by our team of experts.
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Our Take
Funding U doesn’t rely on credit scores in its lending decisions. Instead, the lender assesses borrowers based on academic success and projected earnings after graduation. However, they have a borrowing limit of $20,000 and terms of just five and 10 years.
Pros
- No fees.
- Extra payments are applied to the principal unless the borrower states otherwise.
- Offers up to 24 consecutive months of hardship forbearance.
- Academic progress is considered rather than credit score or income.
Cons
- Does not offer renewable or multi-year approval options.
- Borrowers are not assigned a dedicated advisor or banker when they have a Funding U loan.
- In cases of borrower disability, loan discharge is determined on a case-by-case basis. In some cases, disability discharge will be temporary.
- Compared to competitors, the loan amounts are smaller and the loan terms offered are shorter.
Lender | Fixed APR | Min. credit score | Variable APR | |
|---|---|---|---|---|
 Check Rate on Sallie Mae's website | 2.89-17.49% | Mid-600s | 3.62-16.25% | Check Rate on Sallie Mae's website |
 Check Rate on College Ave's website | 2.59-17.99% | Mid-600s | 3.89-17.99% | Check Rate on College Ave's website |
 Check Rate on Ascent's website | 2.69-16.86% | Low-Mid 600s | 3.65-16.06% | Check Rate on Ascent's website |
 Check Rate on Monogram's website | 3.35-17.17% | Mid-600s | 3.53-17.23% | Check Rate on Monogram's website |
 Check Rate on ELFI's website | 2.99-12.85% | 680 | 6.75-13.05% | Check Rate on ELFI's website |
Full Review
This lender stands out in the private student loan field because it evaluates students based on their academic performance, major, year in school and projected earnings — instead of looking at credit scores and income. Co-signers aren’t necessary and there are no origination or application fees.
Funding U only lends to undergraduate seniors who are nearing graduation. Borrowers must have a minimum 2.5 GPA to qualify. International students, and students attending an online-only or for-profit school, are not eligible for a Funding U loan. In order to complete a Funding U loan application, applying borrowers will need to provide their driver’s license, school transcripts, financial aid information and proof of income.
When borrowers sign up for automatic payments they are eligible for a 0.50% interest rate reduction for as long as they are enrolled in autopay. Borrowers who choose to make interest-only payments while enrolled in school receive an additional 0.50% rate reduction.
More about Funding U
Loan and borrower requirements
Loan terms: 5 and 10 years.
Loan amounts: $3,001 - $20,000.
Minimum credit score: Credit scores are not used in underwriting.
Minimum income: Not applicable.
Maximum debt-to-income (DTI) ratio: Not applicable.
Time requirement after filing for bankruptcy: Does not lend to borrowers who have filed bankruptcy.
Co-signer: Does not allow.
Payment and repayment
Allows greater-than-minimum payments via autopay: Yes.
Allows biweekly payments via autopay: Yes.
Grace period following graduation: 6 months.
In-school repayment options: Interest only and partial ($20 minimum) payments.
Post-school repayment options:
Interest-only payments.
Administrative forbearance (not counted against other forbearance options).
Natural disaster forbearance (not counted against other forbearance or deferment options).
Temporary lower payments.
Paused and decreased payment for temporary disability.
Military deferment (not counted against other deferment options).
Customer experience
Customer service: In-house representatives can be reached via phone, email and live chat (Monday through Friday from 8:30 a.m. to 8:30 p.m. Eastern Standard Time). There is also a chat bot available to borrowers.
Typical time for application approval: Students can check their eligibility in under five minutes. In order to be approved, applicants must provide an application and supporting documentation for review. Exact time for application approval was not disclosed.
Loan servicer: Launch.
Funding U extras
Extra payments are applied to the principal, unless the borrower states otherwise.
Funding U loans have no affiliated fees, and offer an incentive for graduation (a $100 Amazon gift card when borrower shows proof of graduation).
Before applying for a Funding U student loan
Before taking out a Funding U 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.
» MORE: NerdWallet’s FAFSA Guide
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.
STUDENT LOAN RATINGS METHODOLOGY
Our student loans editorial team surveyed 20 banks, credit unions and online lenders that offer student loans and student loan refinancing. These include the top lenders by market share and online search volume, as well as some lenders that serve specialty or nontraditional markets.
We considered and scored more than 60 features and data points for each financial institution in the categories of loan flexibility, affordability, transparency, customer experience and variety of borrowers served.
The stars represent ratings from poor (one star) to excellent (five stars). Ratings are rounded to the nearest half-star.
Read more about our ratings methodology for student loans and our editorial guidelines.