Student Loan Rates Vary Significantly by Provider

Local Nonprofit Student Loan Provider Encourages Consumers to Do Their Research

August 30, 2021

College bills were recently due for families across the state, prompting many to turn to private education loans to fill the gap left after financial aid, savings and earnings were applied to the amount due.

Iowa Student Loan Liquidity Corporation,® financing college as ISL Education Lending, wants families in this situation to compare rates from multiple lenders and understand how shopping around for the best rate can save families thousands of dollars over the life of their loans. Steve McCullough, ISL president and CEO, pointed to survey results published by the Iowa Attorney General's Office. "Many lenders offer a range of rates, with the highest rates up to 12% more than the lowest ones," said McCullough. "The rates that students and families actually receive are based on the applicant's credit score and the lender they choose, and likely won't be the lowest advertised rate."

The Iowa Attorney General published the results of their survey August 5 in its monthly Consumer Focus newsletter. The survey encompassed more than 7,800 fixed interest rate loans provided to students at Iowa universities and colleges during the 2020–2021 academic year from 10 lenders.

Comparing ISL Education Lending to Iowa Attorney General published survey results.
Credit Score * Interest Rate Range Average Interest Rate
  10 Lenders ISL Education Lending 10 Lenders ISL Education Lending
Excellent (750-850) 1.44–13.88% 4.60–6.91% 6.44% 6.10%
Good (700-749) 3.50–14.24% 6.20–7.83% 8.27% 6.61%
Fair (650-699) 4.86–13.87% 6.30–7.83% 10.21% 6.97%
Poor (550-649) 5.83–13.62% Not Applicable 12.34% Not Applicable
Bad (300-549) Not Applicable Not Applicable Not Applicable Not Applicable

* Highest credit score of borrower and cosigner. Back to content

Source: Aggregate data for 10 lenders from the Iowa Attorney General's Office; ISL Education Lending data computed from data submitted to the Iowa Attorney General for the study.

ISL encourages those who need loans to not be fooled by "teaser" rates that are often quite different from actual rates offered to applicants. According to the Consumer Focus article, "The interest rates received by borrowers did not always fall within the rates advertised by lenders … Lenders often advertise their lowest rate even though most borrowers won't qualify for that interest rate."

"It can be challenging for consumers to know the rate they will receive," McCullough said. "That's why we publish each of our loan rates, and the FICO score needed to obtain them, on our website with our loan information. We encourage families to shop around and compare our rates to those offered by other lenders."

"We are an organization committed to helping families avoid a personal student loan crisis," said Christine Hensley, chair of ISL's board of directors. "That includes helping families figure out how to borrow less for college and plan good outcomes." Besides its lower-cost loan programs, ISL has created tools and resources for families to use as they plan for and pay for college, and it offers scholarships and award programs. Information about these programs and resources is available at

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Christopher Weishaar, Digital PR Specialist, (515) 273-7102,