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Updated on Wednesday, May 13, 2015
Updated March 3, 2016
Eastman Credit Union (ECU) is based in Tennessee and Texas. Unfortunately, its website offers little to no information about its student loan consolidation product. This review aims to shed some light on the details so you can make a smarter decision regarding your student loans.
The maximum amount you can consolidate with ECU is $125,000 – that’s for undergraduate and graduate loans. You can consolidate both federal and private loans as well.
You can get a 1 – 25 year term. All terms are offered on a fixed rate that currently range from 6.50% – 8.00% APR. You can see current rates here.
If you were to borrow $20,000 on a 6.50% APR on a 10 year term, your monthly payment would be $227.10.
Pros and Cons of Eastman Credit Union Student Loan Consolidation
As with any loan offered on a longer term, be aware it will cost you more. This is due to paying more in interest over the life of the loan.
Longer loan terms aren’t necessarily a bad thing, as they can drastically lower your payments, making them more affordable. Just try and pay extra whenever possible.
While consolidating your student loans makes it easier to manage payments, you need to know the benefits you may sacrifice in order to consolidate.
Federal student loans come with many perks that disappear once you refinance or consolidate them. These benefits include deferment, forbearance, forgiveness, discharge, and income-based repayment plans.
Essentially, the flexibility you get with Federal student loans is taken away when you consolidate. Calculate exactly how much you’re saving by consolidating, and take into account your current and possible future job situation. You don’t want to end up in a rough spot where you’re struggling to afford your payments.
ECU has an asset recovery group that evaluates loans on a case-by-case basis in case borrowers are experiencing difficulty in making payments, but you don’t want to rely on a service like this just in case you’re not eligible.
The Fine Print
ECU has no prepayment penalty, origination fee, nor application fee. There are fees to pay if you’re late on a payment or your payment doesn’t go through, but the fee depends on the amount you owe. ECU was not particularly forthcoming with this information in a phone call.
Who’s eligible to consolidate student loans with ECU? As with any credit union, you must be a member to be eligible. Those that reside within a community on ECU’s coverage map can apply for membership, and there are additional sponsor and contractor companies they service as well.
Considering it only has locations within two states, not many people will be eligible to apply. If you don’t live within the area of coverage, scroll down a few sections to take a look at alternative lenders.
If you are within the area of coverage, you need to be 18 years or older and have a valid social security number. While your credit score mostly determines your interest rate, ECU also looks at your debt-to-income ratio in comparison to the amount you want to borrow.
Documents Needed to Apply
Before you start filling out the application (which can be completed online), get the necessary documents together so applying goes smoothly. Note that when you fill out an application with ECU, it uses a hard credit pull, which can lower your credit score.
You should have the following:
- Driver’s License
- Your salary and employment information
- You’ll need loan statements for each of the loans you wish you consolidate
- If you’re paid bi-weekly, you’ll need your last two pay stubs; if you’re paid weekly, you’ll need your last 4 pay stubs (they need a month’s worth)
- Are you applying with a co-applicant? Their pay stubs will also be needed
When you begin the application process, you’ll be asked how much you want to borrow. Terms will be given to you on the following page based on the amount requested.
ECU also lets you save any progress you make on your application. You just have to create a password to access your application – it’s only saved in the system for 7 days.
The entire application process can be completed fairly quickly. The sooner you submit the documents needed, the sooner your funds can be received.
Who Benefits the Most from Consolidating With Eastman Credit Union?
It makes sense for those that are already members of ECU to check with the credit union first when consolidating their student loans. If you’re wary of online lenders and have an established relationship with representatives at ECU already, you might find peace of mind in being able to make an appointment at a local branch.
What About Other Alternatives?
While ECU doesn’t have bad rates, you can still do better with other online lenders.
SoFi is the first online lender we recommend because of its low rates and benefits. Fixed rates range from 2.99% – 6.09% APR and variable rates range from 2.25% – 6.09% APR if you’re enrolled in autopay. There’s no maximum set amount you can borrow, and it offers terms up to 20 years instead of 15 years.
The added bonus with SoFi is that it offers unemployment protection. If you’re laid off from your job, SoFi can temporarily pause your payments and coach you on how to secure another job. There are no prepayment penalties or origination fees.
The only downside is there’s a list of eligible schools and programs SoFi services, so if your school or program isn’t on there, you’re not able to refinance. SoFi has been working to expand its reach, so call to see if your school is eligible.
Another option specific for graduates is CommonBond. Its fixed rate APR ranges from 2.78% – 5.59%, and its variable rate APR rates start at 1.99%. These terms are very close to what SoFi offers, and both lenders initially use a soft pull of your credit to give you your rates. A hard pull will only be used once you agree to move forward with the loan.
Lastly, if your school or program isn’t on either CommonBond or SoFi’s list, check out Citizens Bank. Undergraduates can refinance up to $90,000, graduates (including MBA) can refinance up to $225,000. If you have a law degree you can refinance up to $300,000, and professionals (dental or medical) can refinance up to $350,000. It offers the same 20 year term as the others. Its fixed rates range from 2.99% – 8.49% APR, and its variable rates range from 1.99% – 8.24% APR. Citizens Bank uses a hard credit inquiry.
Aim to Get the Best Rates Possible
ECU doesn’t offer variable rates, and while variable rates are unstable, they do start off fairly low. If you know you can pay your student loans off quickly, you might want to look into the alternative lenders that offer a variable rate option.
ECU’s lowest rate – 6.50% – might be lower than what your current private and federal student loans are at (especially if you graduated several years ago), but most of these lenders start in the 3% or 4% range.
If you want to shop around, find lenders willing to use soft credit pulls initially, such as SoFi and CommonBond. You can get a feel for the kind of rates you’ll be offered, and you’re never under any obligation to accept a loan. Not satisfied with what they’re offering? Shop around within a 30-day window and your credit score won’t decrease as much.
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