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Sallie Mae Smart Option Student Loan

Phone Number for New Applicants: 888-2SALLIE (888-272-5543)
Hours of Operation: M-Th 8am-9pm, F 8am-8pm ET

Interest Rates


  • THIS IS A VARIABLE RATE LOAN.  Interest rates will change during the life of loan based on changes to the 1-month LIBOR (to view current 1-month LIBOR rates, click here)
  • Current Starting Interest Rate Between 2.25% and 9.37%
    • Range in terms of index:  1-month LIBOR +2.0% to +9.12%
  • Valid as of June 25, 2014 from Sallie Mae website

Loan Fees


  • Origination Fees:  None
  • Late Payment Fees:  Will be identified on the borrower's Disclosure Statement (SLA Research:  Greater of $5 or 5% of monthly payment)
    • Timing:  15 days after payment is due, a payment is considered late
  • Returned Payment Fees:  $20
  • Forbearance Fees:  Forbearance Fee will be disclosed to the borrower prior to the fee being assessed.  (SLA Research:  $50 for each loan (maximum fee of  $150 per loan), must re-apply every 3 months for up to 24 months and fee is incurred each time.)

Repayment Terms


  • Standard Repayment Term:  Will vary based on loan amount and year in school (SLA Research:  5-15 years)
  • Interest-only payments REQUIRED while borrower is in school:  No
  • Prepayment Penalties:  None

Savings Opportunities


  • Auto-Debit Benefit:  0.25% interest rate reduction for signing up to make payments via auto-debit from your bank account.  
  • Receive a 2% reward in Upromise account for making on-time payments



  • Although not required, a co-signer may help borrower reduce the interest rate on the loan and increase the chances of having the application approved
  • Co-signer Release:  12 months after the separation period

Loan Amounts


  • Annual Minimum Loan: $1,000
  • Annual Maximum Loan: Cost of attendance less any other financial aid
  • Aggregate Maximum:  Varies by School

Application Process


  • Provides immediate response to online loan application:  No
  • Upon online credit approval, provides immediate "plain English" disclosure on interest rates and fees: Not applicable

Loan Cancellation


  • Borrower may cancel loan within 10 business days of the date of the Disclosure Statement
  • Review lender's Promissory Note for details on loan cancellation process

Promissory Note




  • Sallie Mae



  • Loan approval rates, which are not publicly available, may be low
  • Lack of repayment flexibility: Only major private lender that REQUIRES borrowers to make interest-only payments during in-school period
  • Funding of private loans reliant on ability of Sallie Mae Bank to continue to raise deposits
  • Confusing repayment structure:  the variable rate on loan changes monthly while monthly payment owed by borrower changes quarterly
  • This loan may not be dischargeable in bankruptcy



  • Once you have applied for a loan, please complete this short survey to tell us about your experience

Student Lending Analytics (SLA) is an independent research and advisory firm and is not a lender.  SLA receives NO compensation from any lenders for our service nor for any referrals that they may receive through this website.  While SLA has made every effort to confirm each of the lender loan terms described above, it assumes no responsibility for typographical or other errors or omissions in the information provided.  SLA makes no representations or warranties about your eligibility for a particular loan.  SLA recommends that you carefully review each lender's loan application and promissory note for final loan terms, including Savings Opportunities.  Savings Opportunities may not be automatically available and you may not be eligible for certain Savings Opportunities.


Student Lending Analytics Releases 2009 Private Loan Guide

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