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Icon: Supplemental Private Loans

Supplemental Private Loans

We use our nonprofit status and access to tax-exempt bonds to offer supplemental private loans with competitive rates and a variety of repayment options to help students and their families as well as those who are out of college and looking to improve student loan repayment.

Private Student Loans

As a nonprofit, Iowa Student Loan has the ability to issue federally tax-exempt Private Activity Bonds, in the form of Qualified Student Loan Bonds (QSLBs). We issue these tax-exempt bonds to fund competitively priced loans, which are a key way we help Iowa students and families obtain the resources necessary to succeed in postsecondary education. We issue taxable bonds to fund loans with no Iowa connection.

As a nonprofit, we also have the ability to invest our resources into borrowers. In the recent past, that has meant helping shortage area workers in the state — specifically teachers and nurses — with grants and loan forgiveness programs. We also honor the sacrifices our borrowers serving in the military make by reducing the interest rates on their private loans while they serve.


Using Bonds to Offer Competitively Priced Options to Pay for College

Through our use of QSLBs, we are able to offer students and families access to loans with interest rates that are less than the Federal Direct PLUS Loan rate for the 2018–2019 academic year. Used by parents of undergraduate students as well as taken out by graduate and professional degree students, the PLUS Loan also has loan fees of more than 4%. For parents or students with creditworthy cosigners, our student and family loans currently offer borrowers a way to pay less in interest and fees than they would by taking out a PLUS Loan or many private loans offered by national lenders.


Helping Students in School

Our Partnership Advance Education Loan and College Family Loan help students and families pay for college when savings, earnings and financial aid are not enough to cover college costs.

Information about both loans is provided in full detail — from underwriting criteria to examples detailing the annual percentage rate, estimated finance charges and approximate monthly payment amount for each interest rate and in-school payment option — on each loan’s pages. This includes guidance that strongly encourages students and families to explore and exhaust all sources of student financial aid before applying for either of the loans as they are both supplemental private loans.

Options for Refinancing

Through QSLB financing, we also offer the Reset Refinance Loan for borrowers in repayment looking to lower their interest rate, monthly payment amount or the amount they will repay over the life of their loan. With rates rising across the financial markets, borrowers with variable rates are now facing increased monthly payment amount that they may not be used to after years of low rates. We have spent much of 2018 reaching out to our borrowers and Iowans with loans from other lenders with high interest rates who may most benefit from refinancing.

Reducing Private Loan Interest Rates for Military Service

To meet the needs of borrowers who are serving our country, we continue to offer reduced interest rates of 0.00% on private loans for service members while serving on active duty.

Who: 655 service members on active duty

Duration: Through June 30, 2019

Total reduction: $1.2 million in interest reductions for participating service members since 2001

Armed Forces Interest Reduction Program

Through the Iowa Student Loan Armed Forces Interest Reduction Program, service members may have the interest reduced on their private student loans to 0.00% for up to 24 months.

Service members deployed between Sept. 11, 2001, and June 30, 2019, are eligible for the program if, while on federal active duty, they have non-defaulted private student loans owned by Iowa Student Loan during the period of eligibility.