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Sallie Mae Personal Loans 2021 Review: Should You Apply?

Find out whether you should apply for a personal loan from Sallie Mae based on its interest rates, fees, borrowing amounts, and repayment terms.
(3 out of 5) MyBankTracker Editor's Rating

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Your search for the right personal loan may have led you to Sallie Mae, known for being a provider of student loans.

Compared to other lenders of personal loans, Sallie Mae is actually a decent option.

But, there is a caveat:

You must have an invitation code to apply.

Before you even consider applying, learn about the interest rates and fees on Sallie Mae personal loans and find out whether its borrowing amounts and repayment periods fit your needs.

Ideal for Smaller Loans

Look:

When you apply for a personal loan, you usually do so with a specific financial reason.

Whether you have a car repair bill you have to pay, or you want to consolidate credit card debt, you’ll know exactly how much you need to borrow.

You want a lender that offers loans large enough to meet that need.

There’s no reason to borrow money if you can’t borrow enough and you don’t want to borrow more than you need.

Sallie Mae offers personal loans ranging from $3,000 to $35,000.

Sallie Mae Personal Loans Pros & Cons

Pros Cons
  • Low borrowing rates
  • No origination fee
  • No prepayment penalty
  • Requires an invitation code
  • Only two borrowing terms available
  • Loan amount range may be lower than other lenders

That’s a reasonable range that will let you borrow the right amount for most needs.

Now:

Many other lenders provide personal loans that can be much larger.

Some may offer personal loans as high as $100,000.

If you need to borrow more, you should look for a lender that specializes in large personal loans.

Only Two Repayment Terms

Once you’ve figured out how much you need to borrow, you need to figure out how long you’ll need to pay the money back.

This is known as the loan’s term.

For example, a loan with a four-year term will have 48 monthly payments. If you make each payment, you’ll pay the loan off after four years.

Sallie Mae offers terms to choose from:

  • 36 months
  • 60 months

Long-term loans will cost more than short-term loans. They leave more time for interest to accrue.

The benefit of a long-term loan is that they have lower monthly payments.

Short-term loans are cheaper because of their lower rates and the reduced amount of time that interest has to accrue.

In exchange, the monthly payment is likely to be larger.

Try to strike a balance when you’re choosing your loan’s term. You want a manageable monthly payment while minimizing the total cost of the loan.

Want a shorter term?

If you want a short-term personal loan, you can still have one with Sallie Mae because it doesn't charge prepayment penalties.

So, just take a 

Application Requirements

One of the downsides of Sallie Mae’s personal loans is that you need an invitation code to be able to apply for the loan.

Sallie Mae will occasionally send invitation codes to people who it feels meets its requirements for borrowers.

The good news:

You can feel confident about your odds of getting approved if you receive an invitation code.

The bad news:

There’s no way to get an invitation code if Sallie Mae doesn’t target you.

If you haven’t gotten a code in the mail or e-mailed to you, you’ll have to work with a different lender.

Your chances of getting a code are probably higher if you already have a bank account or loan with Sallie Mae.

Fees and How Long It Takes to Get the Money

When you compare different lenders, you’ll find that each has a specialty.

Some are great at approving loans in short amounts of time and getting money to you very quickly. Others specialize in offering large loans.

Sallie Mae’s specialty is avoiding fees.

It offers personal loans without any origination fees or prepayment fees.

Origination fees increase the amount you owe from the moment that you borrow money, adding a percentage of the amount you borrowed to your balance.

Prepayment fees are charged when you pay your loan off ahead of schedule, compensating the lender for lost interest income.

Once Sallie Mae receives your loan application, it can take a few days for it to approve or reject the application.

If your application is approved, the money can be disbursed as soon as the next business day.

That means you can get the money deposited to your account in less than a week.

Get Free Access to Your Credit Score

One of the most popular reasons to apply for a personal loan is to consolidate existing debt.

If that’s your plan, you’ll want a way to see how your credit score improves as you pay down your loan.

If you get a personal loan from Sallie Mae, you’ll get free, quarterly updates of your credit score, making it easy to track your progress.

What You Need For Your Application

Once you’ve decided that you’re going to apply for a personal loan, you should do whatever you need to do to make sure your application is approved.

During the application process, you’ll be required to submit information that the lender can use to make a decision.

The information you’ll be asked to provide will often include:

  • Name
  • Address
  • Date of birth
  • Proof of identity, such as a driver’s license
  • Social Security number
  • Annual income
  • Proof of income, such as bank statements or pay stubs
  • Verification of employment

It might sound like getting this much information together will be difficult, and it certainly can be.

Still, it’s essential that you provide as much information as possible, with the clearest documentation that you can.

Providing incomplete or unclear information will reduce your chances of getting approved for a loan.

In the best case, the process will be delayed as the lender requests clarification and additional documentation.

In the worst case, your application will be rejected outright.

Improving Your Chances of Getting Approved for a Personal Loan

Before you submit your application, you should take steps to improve your chances of getting approved for a personal loan.

Work towards better credit

Your credit score is the most important factor in your loan application’s success.

Credit scores are a measure of your financial trustworthiness.

If you have a good credit score, it shows lenders that you pay your bills on time. You have a poor credit score, it indicates that you might make late payments or miss payments entirely.

Maintaining a good credit score is important because it makes borrowing money cheaper and gives you access to more loans.

Out of these factors, the most important is your payment history.

Paying every one of your bills before its due date will go a long way towards giving you a good credit score. Even one missed payment can have a major, negative effect.

The amount that you owe is the second largest factor. Avoid taking out unneeded debt or maxing out your credit cards.

Of course, the two most important factors are the hardest to influence in the short-term.

There are, however, some quick fixes to improve your credit score.

Try to avoid applying for new loans or cards in the months leading up to an important loan application.

Every time you apply for a loan, your score drops by a few points.

Also, avoid using your credit cards in the month before you apply.

This will reduce the balance that your card issuers report to the credit bureaus, making it look like you owe less.

Drop your debt-to-income ratio

Your debt-to-income ratio also plays a role in whether your application is approved.

This ratio is a measurement of how much of your income goes towards monthly bill payments.

You can calculate your debt to income ratio by dividing your monthly income by the sum of your monthly minimum payments on your debts and your rent bill.

So, if you make $5,000 a month and your rent and bill payments add up to $2,500, your debt-to-income ratio is 50%.

You can improve this ratio in two ways.

The best way to do so is to pay down your existing debts. This strategy will also give your credit score a boost, increasing the chance of a successful application even further.

You can also improve the ratio by increasing your income.

However, that's not always under your control at a moment's notice

How Does It Compare?

Sallie Mae is far from the only lender that offers personal loans. You should always consider every option available to make sure you get the best deal available.

Start by comparing the interest rates of different loans. Always opt for the lowest rate assuming all of the loans’ other features are the same.

Next, compare the fees of the loans.

You want to find the loan with the lowest fees. If you’re comparing loans with different fees and rates, do the math to find out which will be the cheapest when all is said and done.

Conclusion

Sallie Mae’s personal loans are a solid choice for people who need to borrow money and are targeted with an invitation code.

The lack of loan fees and the ability to borrow as little as $3,000 mean that most people who need a personal loan will be well-served by Sallie Mae.

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