About lender
Funding U, alternatively referred to as Funding University, provides student loans to eligible undergraduate students in select states, such as South Carolina, West Virginia, New Mexico, and others. Unlike traditional lenders, Funding U doesn't require a cosigner for their loans, making them accessible to students who may not have a cosigner available. One notable aspect of Funding U's lending process is their approach to evaluating applicants. Instead of solely considering credit history, Funding U looks at various factors such as academic achievement, projected total student debt, and future earnings potential after graduation. This approach allows them to assess the borrower's ability to repay the loan based on their academic success and future prospects, rather than solely relying on credit scores.
Features
- No Credit Required or Co-signer Allowed. Funding U's lending model doesn't rely on credit history or require a co-signer for approval. This makes their loans accessible to students who may have limited or no credit history, as well as those who don't have a co-signer available to them.
- In-School Payments Required, with Flexible Options. Borrowers are required to make payments while still in school, but Funding U provides multiple repayment options for those who encounter difficulties. This flexibility allows students to manage their loan obligations more effectively while pursuing their education.
- Maximum Loan Amount of $20,000. While the maximum loan amount of $20,000 may be lower than what some other lenders offer, it can still be a significant source of funding for undergraduate students. This amount can cover tuition, fees, and other educational expenses, helping students pursue their bachelor's degree programs.
- Limited Availability in Certain States. Funding U's loans are not available in 12 states, which may limit access for students in those regions. However, for eligible students in states where Funding U operates, it provides a valuable alternative for financing their education without the need for a co-signer or established credit history.
Pros and cons
Pros
Cons
Reliability
Funding U's reliability can be assessed based on various factors, including customer reviews, accreditation, and industry reputation. While Funding U is not accredited by the Better Business Bureau (BBB), it's worth noting that it holds an A rating from the BBB. While accreditation by the BBB is one measure of reliability, it's not the sole determinant. Other factors such as customer feedback, transparency, and regulatory compliance also contribute to an institution's reliability.
How to apply for a Funding U loan
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Visit the Website. Go to the Funding U website.
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Click "Apply Now". Locate the "Apply Now" button on the website and click on it to begin the application process.
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Note Regarding Application Period. Please be aware that Funding U is no longer accepting applications for the 2023-2024 school year. Interested applicants are advised to return in early June to apply for the 2024-2025 academic year. You can sign up below for an email reminder to notify you when the application period opens.
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Prequalify. Complete the prequalification process. This may involve providing basic information about yourself and your educational background to determine your eligibility for a loan.
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Assigned Loan Officer. You'll be assigned a dedicated loan officer who will guide you through the next steps of the process. Your loan officer will provide details about your loan offer, repayment options, interest rates, and terms.
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Submit Required Documents. You'll need to submit the necessary documents to finalize your loan offer. These documents may include proof of enrollment, income verification, and other relevant information.
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Preapproval Letter (if needed). If required by your school's financial aid office, you can request a preapproval letter from Funding U to confirm your loan eligibility.
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Disbursement of Funds. Once the semester begins, Funding U will disburse the loan funds directly to your school to cover your educational expenses.
Conditions
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Loan Amount. Funding U offers loans ranging from $3,001 to $20,000 per academic year. This provides flexibility for students to borrow the amount they need to cover their educational expenses.
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APR. The Annual Percentage Rate (APR) for Funding U loans ranges from 7.49% to 12.99% when enrolled in Autopay. This rate may vary depending on factors such as creditworthiness and repayment terms.
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Term Lengths. The repayment term for Funding U loans is 10 years. This allows borrowers a reasonable timeframe to repay their loans while managing their monthly payments.
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Grace Period. Funding U provides a grace period of 6 months after graduation or leaving school before repayment begins. During this time, borrowers are not required to make payments, allowing them to transition into the workforce before starting loan repayment.
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Repayment Terms. The repayment term for Funding U loans is also 10 years. This provides consistency in repayment expectations and allows borrowers to budget accordingly over the life of the loan.
Requirements
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Citizenship or Residency Status. Applicants must be a U.S. citizen, permanent resident, or DACA recipient.
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Age. Applicants must be at least 18 years of age.
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Student Status. Applicants must be undergraduate students enrolled in a bachelor’s degree program at a Title IV-eligible four-year college.
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Enrollment Status. Applicants must be enrolled full-time in their undergraduate program.
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Program or Field of Study. Applicants must be enrolled in an approved program or field of study at their college or university.
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Residency. Applicants must be residents of one of the qualifying states. These states include Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Nebraska, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, and Wisconsin.
Ways to receive the money
Once approved for a Funding U loan, the borrowed amount will be disbursed directly to your eligible school. This means that the funds will be sent directly to the school's financial aid office and applied to your student account. The disbursement will cover costs included in your college's cost of attendance (COA), which encompasses various expenses such as tuition, fees, books, housing, and other educational-related costs. It's important to note that the COA is not necessarily the same as the tuition bill you receive from your college; rather, it represents the estimated total for all costs associated with attending school for the given academic year.
Products
Funding U primarily offers student loans tailored for undergraduate students attending eligible four-year colleges. These loans are designed to be accessible to students who may not have established credit or a co-signer available to them. By providing loans without the need for credit history or a co-signer, Funding U aims to support undergraduate students in financing their education and pursuing their academic goals.
Other Student Loans
Reasons you may be denied for a Funding U loan
- Failed Soft Credit Check. Funding U typically conducts a soft credit check as part of the application process. If the results of the credit check are unfavorable, it could lead to denial.
- Financial Hardship or Economic Instability. Applicants who are facing financial hardship or economic instability may be denied if they are unable to demonstrate the ability to repay the loan.
- Past Due Tuition or Missed Payments. Applicants with a history of past due tuition or missed payments on previous loans may be denied due to concerns about repayment reliability.
- Cancellation Fees or Other Outstanding Debts. If an applicant has outstanding debts, such as cancellation fees or other financial obligations, it may impact their eligibility for a Funding U loan.
- Failure to Meet Loan Amount Criteria. If the requested loan amount exceeds Funding U's maximum limits or falls below the minimum threshold, the application may be denied.
How to repay a Funding U loan
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Payment Options While in School. Borrowers can choose to make interest-only payments every month. Alternatively, they can opt for a minimum payment of $20 each month. The in-school period can last up to 51 months, during which borrowers can make these payments. If a borrower drops below full-time enrollment, the loan will enter a six-month grace period.
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Repayment Period After Grace Period. After the six-month grace period ends, students will begin full repayment of their loans. Funding U offers a single repayment term of 10 years. Borrowers must repay their loans over this period.
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Forbearance Options. For borrowers who meet certain criteria and are either in school or in repayment, Funding U offers forbearance in 90-day increments. Forbearance allows borrowers to temporarily suspend or reduce their loan payments if they are facing financial hardship or other qualifying circumstances.
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Editorial opinion
Important
How to Choose a Lender
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Make sure to confirm whether the lender is licensed to operate in your state. You can verify this information with your state regulator or attorney general.
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Check if the lender is a member of a reputable association, such as the Community Financial Services Association of America. Membership in such organizations may provide an extra level of reliability.
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Carefully review all the terms and conditions of your payday loan contract.
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Thoroughly examine the interest rates on payday loans and ensure that your contract includes a detailed breakdown of the total cost of the loan.
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Take advantage of your right of rescission. Usually, you can rescind the loan within three days after signing the agreement. Alternatively, there is typically a "cooling-off" period, which allows you several days to thoroughly review the contract before making an informed decision to enter into a consumer loan agreement based on the terms specified by the lender.
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Choosing a payday lender is a significant decision that demands careful consideration and a good understanding of how such organizations operate.
Additional resources
- Funding U Customer Reviews
