Student Loan Marketplaces Profiled in Wall Street Journal

March 18, 2022 Off By Virgil Olson

Student Loan Marketplaces Profiled in Wall Street Journal

  • A bank that blogs, and one that will provide good PR, regardless of whether students like it
  • Even if it looks a bit hokey, you can tell the bank put an effort into the design, unlike Bank of Internet (see NetBanker Aug. 31)
  • A good cross-section of authors, one from marketing, one who’s a May college graduate, one communications consultant, and a bank-sponsored, literacy-program manager (where are the guys though?)
  • Full bios and pictures of the authors
  • Comments are open (but moderated of course), which is a good feature provided the function is used. The bank will probably have to do some subtle encouragement, perhaps with employees, to get some Q&A started
  • There are only two postings, neither of which offered anything useful or interesting; try to launch with something interesting, even if it’s a blatantly commercial sweepstakes
  • The design is a bit hokey; Trey Reeme over at OpenSourceCU called it, “a little on the MySpace side with a WF feel” (hint: that is not meant as a compliment)
  • The content needs more pizazz

MyRichUncle Discounts Student Loans

sub prime personal loans

I f you are looking to boost student-loan volume, you had better postpone that summer vacation. The upcoming July 1st interest-rate boost has created much FUD (fear, uncertainty, and doubt) for borrowers. The reason: existing borrowers have the opportunity to lock in the current rate of 5.3% on Stafford loans or 6.1% on PLUS if they consolidate their loans and refinance prior to July 1. After that, most lenders will raise rates on these loans by almost 2% to the new rate caps of 7.14% and 7.94% respectively.

However, a high level of activity will continue through July and August as students and their parents look for money to cover that big tuition bill in September.

With the vast majority of college-bound teenagers using search engines, online marketing is a powerful way to find prospects. However, you won’t be alone. A Google search today for “student loan” had 87 advertisers bidding on the term (see screenshot above). So it’s going to take more than a simple ad buy to break out from the online crowd.

  1. NextStudent (across top)

MyRichUncle If you look through these top advertisers, you’ll see a number of innovative techniques for capturing loan applications or leads. One of the big innovators, advertiser #7, MyRichUncle (see screenshot right), has recently earned positive PR by announcing that it will continue to price its Stafford and Plus loans 1% to 1.75% BELOW the new July 1 maximum rates. The company even earned a nice Jane Kim sidebar in today’s Wall Street Journal.

Unless you already have resources in place, it’s probably too late to participate in the student loan refi boom

Aside from its pricing and memorable name, MyRichUncle also does a good job of succinctly summarizing the available options and steering borrowers into the correct program. It even offers a Preprime loan option for students without credit histories or co-borrowers.

At the end of that 60-second quiz, as soon as the email is entered, Credible displays the potential savings from a student loan refi.

Sure, I’d like to have more security options, fewer unintelligible messages, and a Cash Tank. But most of these are feature/function improvements, not must-have issues that need to be solved.

Analysis Strategically, Student Payback appears to be right on the money. It allows VM to better target the P2P student loan , graduating from merely formalizing existing loan agreements to actually brokering multi-party financing deals. For example, initial seed money could come from mom and dad with help from government/school programs. Then as the student progresses through their studies, additional financing could come from Virgin Money partner bank(s) and/or individuals/organizations with an interest in helping students at particular schools (e.g., alumni) or those entering certain fields. Scholarships, grants, internships and other related activities could also be thrown into the mix.

While that site is pure community service, The Student LoanDown hopes to educate students and parents while driving more business to its student loan unit. Live less than 24 hours, it’s too early to give it a how do payday loans work full grade, but here are our first impressions.