Over the last few years, several FinTech (Financial Technology) companies have started with an aim to help student loan borrowers better manage their student loan debt. Realizing that there is over $1 trillion in outstanding student loans, these companies have been seeking to address all facets of the student loan problem – from financial literacy education, to refinancing and consolidating loans, to tools to help borrowers pay off the loans faster.
While these companies might not be the best choice for every borrower, they do offer some interesting perspectives to help student loan borrowers deal with their debt.
Improving Student Loan Debt Literacy
One of the larger gaps that companies have identified when it comes to student loan debt is a lot of borrowers simply don’t know what to do. Companies in this space are looking to help borrowers overcome that financial literacy gap.
Student Loan Hero: Student Loan Hero is a platform for managing student loans where you upload your financial information and it provides customized recommendations to you, as well as reminds you of when bills are due. With Student Loan Hero you upload your student loan information and they provide you with customized recommendations based on your situation. They also have a wide variety of calculators that can help as well. Best of all, it’s free for borrowers.
Helping Borrowers Pay Off Their Debt Faster:
Another area that has seen some progress is FinTech companies that aim to help students pay off their student loans faster. Some of the big lenders, such as Sallie Mae, offer their own in-house programs, but only one companies has taken on the challenge of helping all borrowers pay down their loans.
Gradible: Gradible is a new online platform that will allow you to do various tasks like post to Facebook, write blog posts, post to Craigslist and more to earn money. All the money that you earn goes straight to paying off your student loans. When you complete the various tasks on the platform, you can redeem credits that will allow Gradible to make direct payments to your lender for you – helping you pay down your debt faster. A recent review of Gradible highlights that most participants earn about $10-$15 per hour for work completed, which is a pretty good rate to pay off your student loan debt in your spare time.
Understanding Refinancing and Consolidation Options:
The biggest area that has seen growth in recent years is the student loan refinancing and loan consolidation space. Many FinTech companies are looking to create a marketplace for student loan lenders, which will help borrowers by having a more transparent process for finding the best student loan rates.
Achieve Lending: Achieve Lending is an online portal that allows borrowers to compare rates on private student loans in as little as 30 seconds. What makes Achieve Lending unique is that they require little personal information to give you a snapshot of the loan and rate you may qualify for. Yes, to get the loan you will need to provide all of your information, but their tool works well as a snapshot of the market.
LendKey: LendKey is a unique student loan marketplace platform, in that they leverage a marketplace of community lenders, such as local banks and credit unions, to offer student loans. As a result, LendKey typically has some of the lowest student loan refinancing rates available to borrowers looking to refinance.
As the student loan debt crises continues to evolve in America, there will likely be even more FinTech startups that emerge to tackle this issue. For companies whose goal it is to help borrowers, there will likely be a strong market for years to come.
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