Wells Fargo doesn’t have an excellent reputation with its customers. This is a company that has been around for a couple of years, but they have managed to merit very little attention for themselves. This is mostly due to their almost laughable high-interest rates.
So, you may be wondering why I have decided to review this company. It's very simple. Recently, Wells Fargo has been trying to make an effort of improving their image by embarking on a campaign of making their interest rates more competitive.
They have lowered their interest rates, and this has had some considerable impact on the company's overall image. Although not much of a change, it is still a reasonable effort on their part. This is why I have included a review of this company.
The beauty of private student loans is the ability to have options. This may not be a cup of tea for one student, but to another, it could be just what they need.
Therefore, let me take you on a journey of Wells Fargo student loans and what they have to offer you as a student.
Good For: Loan Consolidation
This is probably the most significant advantage of the Wells Fargo loans. That is why I said that it might be of help to one or two students who are financially stuck.
They excel at refinancing at a low-interest rate of 3.75% for their customers and at least 5.49% to outsiders.
Refinancing is the process of consolidating all of your current loans into one loan. This process helps in lessening your installment burden since you get loans at a much lower interest rate.
With Wells Fargo, their refinancing loan limit is $120,000. This is quite high, compared to some of the competitors, and according to their customers, you can even get more than that, depending on your credit report.
If you have more to consolidate, i.e., loans that amount to more than $120,000; you only need to call them and have a discussion with them, concerning your options.
The maximum repayment period for refinanced loans is 15-20 years.
They offer a cosigner program if your credit is not good, and they can release this cosigner after 24 on-time and consecutive monthly installments.
Not good for: Deferment
If you run into some financial difficulties in the course of servicing your Wells Fargo loan, then, you will be surprised to learn that their policy concerning this is not very good.
Deferment is not available with Wells Fargo. This is quite unfortunate and is yet another reason why their loans are not quite so popular.
Deferment is an option that gives customers the option to forego paying the loan for a couple of months or years, in case of pressing financial problems. Most lenders understand this and give customers at least 6-12 months, or more, to get their finances in order so they can be able to resume payment.
Features of Wells Fargo Loans:
Wells Fargo at a glance:
|Reviewed loan||Student loan refinancing|
|Interest rates||Fixed: 5.24% – 9.74%
Variable: 5.24% – 9.74%Includes autopay discount of 0.25%
|Loan terms||15 or 20 years|
|Loan amounts||$5,000 to $120,000 for private loans only. For you to qualify, your individual loan balance must be at least $1,000.|
|Co-signer release available||Yes, after 24 consecutive on-time scheduled payments.|
|Can transfer a parent loan to the child||No|
Wells Fargo interest rates keep changing, and they tend to be lower for their existing customers, where they even get to enjoy a 0.5% discount for being part of Wells Fargo. This is not the case with other lenders.
If you happen to open a consumer checking account with their bank, you shall receive a 0.25% discount on the interest rate. This is a company that is more concerned with increasing their customer numbers than lending to needy students.
Their interest rates are:
Fixed: 5.24% – 9.74%
Variable: 5.24% – 9.74%
Their repayment plans are not as bad as you would imagine, because they allow up to 20 years on their refinancing loans, which is not bad at all, and it's, in fact, better than the industry standard.
Their flexible repayment terms can easily be customized before getting approval for your loan. They give you plenty of control to pick your repayment period and the rate that you want if you qualify.
You can customize your repayment according to your financial status. Students usually have the options of paying back the loans either at 5, 8, 10, 15, or 20 years.
Please ensure to choose a more extended repayment period because this ensures that you pay the least amount of premium each month, and seeing as you are still a student with a limited amount of income; you do not need a significant burden on your hands.
Later, when you leave college and have stable employment, you can always reduce the period and pay more in terms of the monthly installment.
Forbearance – Borrowers can opt to forego payment of the loan for the duration of their stay in school or a maximum of 48 months.
Military forbearance – For the period of their service, military personnel can be able to postpone their loan payments for up to 3 years.
Servicing of loans:
If you compare Wells Fargo loans to federal loans, there is a big difference. Federal loans are usually serviced by a third party, while the Wells Fargo loans are serviced in-house by the company's staff themselves.
This is a one on one management of the loans and rarely do they pass you off to a third party to handle your loan request. It, therefore, eliminates the errors associated with federal loans as a result of third-party management.
Their on-hand loan officers will call you and talk to you about the loan you have applied, which makes it easy for you to negotiate for your loans.
Other types of fees:
Wells Fargo does not charge any origination or application fees to their loans, which is, of course, excellent, but they will charge you a $28 flat fee for late payment. Most of the other lenders we have reviewed do not charge anything for late repayment.
Requirements for qualifications.
This company doesn’t disclose most of their requirements such as credit score and income, but they insist that you must have a good credit report, and if you have a cosigner, ensure they have good credit as well.
This is how Wells Fargo Student loans Compare with other lenders:
|Lender||Interest rates||Loan terms|
|Wells Fargo Student Loans||Fixed: 5.24% – 9.74%
Variable: 5.24% – 9.74%
|Fixed: 5.49% – 12.99% APR
Variable: 4.12% – 11.87% APR
15, 20 yrs.
|5, 10, 15 yrs.|
|Citizens Bank||Fixed: 4.90%
|5, 10, 15 yrs.|
|College Ave||Fixed: 4.72%
|5, 8, 10, and 15 yrs.|
|7, 10, 12, 15, 20 yrs.'|
|INvestEd||Fixed: 4.63%Variable: 3.70%||5 – 15 yrs.'|
|MEFA||Fixed: 3.95%||10, 15 yrs.'|
|Sallie Mae||Fixed: 5.49% – 11.85%
Variable: 4.25% APR – 11.35%
|5 – 15 yrs|
Well, from the table above, it is clear that Wells Fargo is trying to compete with other lenders, and their interest rates are similar to the competitors, but when you look at their disadvantages, it would be much better to consider another lender.
They also appear to be more interested in increasing their customer base than any other business, which doesn’t go well with students who just want money for school.
Our thoughts on Wells Fargo Student Loans:
Wells Fargo Student loans figures
5.24% – 9.74%
|Not Good||This is very high if you compare it with the other companies, and therefore it is not a good option for some students.|
$5,000 – $120,000
|Not good||This is not good, and most companies are actually able to offer student loans up to a limit of $250,000.|
|Loan repayment terms:
|Good||This is good, and very high compared to some that can only go up to 15 years.|
|Not good||The company does not specify the amount of tuition they are willing to cover, and this leaves you wondering whether their loan limit is enough to cover your college costs.|
|Very good||Most other lenders charge this, and therefore it is a big plus for College Ave loans.|
|Late repayment fee
A flat rate of $28
|Not good||This is the first lender I have found charging students for late repayment.|
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If you have good credit and are a member of Wells Fargo Bank, then I would advise that you check out their loan products and look for something that can suit your needs. Otherwise, if you are not a member of the bank and have bad credit, my advice is to stay away from this lender.
Though they have made great strides in the recent past to make themselves more market conducive, they still have a long way to go, and you definitely cannot compare their products and requirements to the other lenders.
They have very strict terms, and their rules are also difficult to comply, especially if you happen to lose your job or are unable to pay the loan. Maybe sometime in the future, they will have better options to offer students.