Funding U Review: Unique Criteria for Private Student Loan Approvals

What you need to know:

• Funding U solely focuses on providing non-cosigned student loans for undergraduates.
• Rather than using a borrower’s credit history for lending decisions, it uses the borrower’s academic success, projected earnings based on major and the institution’s historical graduation data.
• Loan eligibility might be limited by the borrower’s GPA and state of residency, along with the institution’s graduation rate.

Funding U provides private student loan opportunities to undergraduate students without requiring a cosigner or credit history. Instead, it makes lending decisions based on non-credit factors, like your current academic record, course load and projected future earnings.

According to Funding U’s founder, Jeannie Tarkenton, five million students are unable to access a bank loan due to a lack of traditional credit history each year. And more than half of those students will then delay or drop out of school.

Because of this need, Funding U was launched in 2016 to cover gaps in funding for Georgia students. And was later expanded to offer loans to residents across the nation.

Read on for our Funding U review that breaks down important details about this private student loan lender.

Funding U

• Fixed interest rates starting at 7.49% APR

Visit Funding U No Cosigner Undergrad Loans

Funding U review

Funding U private student loans are available to high-achieving undergraduate students to help cover the cost of attendance at an eligible four-year college.

Here’s a brief overview of what to expect from their loan product.

*Rates may include an autopay discount and are subject to change without notice.

Pros: Funding U private student loans

Funding U private student loans are a great option for borrowers who prefer to leverage their academic success rather than rely on their credit history or a cosigner.

Benefits of using Funding U for private student loans include:

• No cosigner required — ever.
• Autopay interest rate discount of 0.5%.
• In-school repayment options: $20 fixed monthly payment or interest-only payments.
• Option for in-school forbearance (up to 51 months; $0 payments).
• Post-grad forbearance available (up to 24 months; $30 minimum monthly payment).
• Forbearance available for verifiable reasons like medical residency, economic hardship, military deployment, total permanent disability and natural disaster.
• No application, origination, cancellation or pre-payment fees.
• Soft credit pull for students seeking loan pre-approval.

Cons: Funding U private student loans

Here are some of the potential disadvantages you could run into when exploring Funding U’s private student loans.

• Eligibility requirements include a minimum GPA and graduation rate threshold for borrowers and institutions.
• Funding U currently lends to only 29 states.
• Maximum funding amount is capped at $10,000 per academic year.
• No variable rate loan product available.
• All loans have a 10-year repayment term.
• No parent loan or graduate loan options.

Additionally, the minimum interest rate is high compared to other private lenders. This is a trade-off for not requiring a cosigner or creditworthiness like other lending institutions.

Funding U eligibility requirements

Funding U’s lending decisions primarily rely on non-credit factors that help shape whether a borrower is able to make their future payments.

It looks at key markers like your academic success within your major and historical graduation data for other students who attended your school. To be eligible for a Funding U private student loan, the applicant must be:

• A U.S. citizen or permanent resident student over the age of 18.
• Enrolled as a full-time undergraduate student.
• Pursuing a bachelor’s degree at a Title IV-eligible four-year college. For-profit schools aren’t eligible.
• Living in an eligible state. Current lending states include Arizona, Arkansas, Colorado, Connecticut, Florida, Georgia, Hawaii, Illinois, Indiana, Kansas, Maryland, Massachusetts, Michigan, Missouri, Nebraska, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Vermont, Virginia, West Virginia, and Wisconsin.

Additionally, Funding U requires a minimum GPA and graduation rate for borrowers and institutions depending on the student’s class year. Minimums are as follows:

Application process for Funding U

Funding U’s loan application process can be completed online within 5 to 10 minutes.

Be prepared to provide the following items with your loan application:

• Updated resume
• Government issued ID
• Recent full transcript
• Financial aid award letter
• Tuition bill

Once your application and supporting documents are submitted, Funding U will respond within five business days. From there, Funding U will verify your information with your school, jump on a call with you and provide your loan documents.

This process usually takes one to three business days. But you can speed up the process by ensuring all submitted documents are complete and accurate.

Final thoughts on Funding U for private student loans

Funding U might open the door for additional funding for high-achieving undergraduate borrowers who don’t have a strong credit history or cosigner to rely on.

However, the minimum interest rate is higher than other private lenders. And the loan amount is capped at $10,000 per year. So, it might not meet your entire financial need if you have a large gap to fill.

But if you only need a relatively small financial gap after exhausting other forms of financial aid (e.g. grants, scholarships and federal student loans), then Funding U is a solid option. Especially for those who already have a successful track record and don’t have access to a creditworthy cosigner.

If you’re ready to go the private student loan route, check your Funding U eligibility and rate and compare it to other top 2022 private student loan options.

Be sure to also check back as Funding U expands its products and services. It’s currently in the process of adding a refinancing product that lets borrowers release their cosigner from any existing student loans. You can join the Funding U waitlist and receive more information as it becomes available.