There was a flurry of recent changes announced by lenders, leading to changes to the SLA Private Student Loan Ratings:
- Discover announced increases to their interest rates which take effect on June 1st. This change has reduced their SLA Private Student Loan Rating to 3 stars (from 4):
- Previous Rates: Prime - 0.5% to Prime + 4.75% (2.75% to 8.00%)
- New Rates: Prime + 1.0% to Prime + Prime + 7.75% (4.25% to 11.00%)
- Chase announced the following change to their interest rates (which took effect on May 23rd, earlier than their expected rollout on June 5th) which led to an improvement of their rating to 2 stars (from one star):
- Previous Rates: 3-month LIBOR + 4.75% to 3-month LIBOR + 12.25% (6.08% to 13.57%)
- New Rates: 3-month LIBOR + 3.65% to 3-month LIBOR + 12.25% (4.97% to 13.57%)
- Note the maximum interest rate for Chase Select loans that are cosigned is 11.57% (3-month LIBOR + 10.25%).
- PNC saw their SLA Private Student Loan Rating increase to 4 stars given the relative attractiveness of their private loan product in light of the increase in Discover's interest rates.
With news of at least one additional lender changing their rates in the days ahead, be sure to refer to the SLA Blog to stay abreast of all changes to private loan products at major student lenders.