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Sallie Mae sounds like a nice, middle-aged lady who’d pour you a glass of lemonade...

Sallie Mae sounds like a nice, middle-aged lady who’d pour you a glass of lemonade on a hot day.

In reality, “she” is one of the nation’s leading purveyors of student loans.

Short for the Student Loan Marketing Association, Sallie Mae is best known for its wide variety of loan types and unique features that provide relief for students in certain scenarios.

So how does Sallie stack up in the heated student loan space? What are Sallie Mae’s most compelling perks? Hidden drawbacks? Finally, is Sallie Mae the right fit for you and your student loan needs?

Let’s investigate Sallie Mae.

What is Sallie Mae?

Sallie Mae was created in 1972 as a government-sponsored lender of federal education loans. The company began moving towards privatization in 1997 and the process was finalized when Congress terminated its charter in 2004.

Since then, Sallie Mae has been busy absorbing other players in the space, broadening its offerings, and overall solidifying its competitive position.

Today, like the Quicken of student loans, Sallie Mae has been able to stave off new competitors through a combination of brand awareness, product variety, and solid numbers.

How does Sallie Mae work?

Sallie Mae makes applying for a loan fast and easy, explaining each step of the process well. To apply for Sallie Mae’s Smart Option Student Loan (read: undergrad loan), you and your co-signer will need to provide:

  • The basics (address, SSN, etc.).
  • School information including enrollment status, degree, and course of study.
  • Academic period of enrollment and year in school.
  • Requested loan amount.
  • Financial aid and scholarships you expect to receive.
  • Employment and income info.
  • Financial info (bank accounts, mortgage, etc.).
  • Two personal contacts.

You can do it all online in as little as 10 minutes. Sallie Mae then performs a hard credit check and shows you your term and interest rate option(s).

Once you make a selection, Sallie Mae will confirm your info with your school and take it from there.

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If you need to contact them, they have loan specialists waiting to chat.

How are Sallie Mae’s terms, rates, and fees?


Sallie Mae will assign you a term of 10 or 15 years, sometimes 20 for graduate loans. Other lenders have more flexible terms and let you choose — something to consider if you want a 5- or 12-year term.


Here’s a quick breakdown of Sallie Mae’s rates as of June 2022, with the 0.25% autopay discount factored in:

Loan type Variable rates Fixed rates
Undergraduate 1.87% – 11.97% APR 3.75% – 12.85% APR
Career training 1.87% – 12.48% APR 3.75% – 13.29% APR
Graduate school 2.62% – 12.11% APR 4.75% – 12.11% APR
MBA 2.62% – 12.11% APR 4.75% – 12.11% APR
Medical school 2.62% – 11.97% APR 4.75% – 11.97% APR
Dental school 2.62% – 11.98% APR 4.75% – 11.98% APR
Law school 2.62% – 11.98% APR 4.75% – 11.98% APR
Dental residency, health professional graduate, or bar study See latest rates See latest rates

Overall, Sallie Mae’s rates are OK, but not the lowest out there. As we’ll see below, fixed loans for undergrad can drop to 3.24%.


Sallie Mae doesn’t charge application or origination fees. Late fees are 5% of the past due payment amount, up to $25, and there’s a $20 returned check fee that I sincerely doubt any undergrad has triggered in 20 years.

Anyways, if you’re feeling a bit dissuaded by Sallie Mae’s restrictive terms and above-average rates, consider that the lender offers some highly compelling features to even the balance.

Features of Sallie Mae

Wide variety of loan types

Sallie Mae offers the following loan types:

  • Undergraduate (bachelor’s, associate’s, or certificate).
  • Career training (culinary, aviation, technical, etc.).
  • Bar study.
  • MBA.
  • Medical school.
  • Medical residency.
  • Dental school.
  • Dental residency.
  • Health professional graduate.
  • Law school.

For context, most lenders only offer undergrad plus MBA/medical/law school. So if you’re looking to finance dental school, a residency program, or your Bar study, Sallie Mae is a top choice.

A Sallie Mae loan can cover 100% of school-certified expenses, such as:

  • Tuition and fees.
  • Room and board.
  • Travel costs.
  • Miscellaneous supplies.
  • Your laptop.

Again, not all lenders go that far — so definitely a consideration if you’re looking to finance the whole kit and caboodle.

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Early co-signer release

Another significant perk of borrowing with Salle Mae is that they let you release your co-signer as early as 12 months post-graduation as long as you can prove your ability to repay your loan.

Most lenders make you wait three or more years — if they allow early release at all.

That’s a big deal because most co-signers will want to be released ASAP. Nobody likes being financially liable for your loan, nor having their debt-to-income ratio all funkified for 15 years. Therefore, the promise of an early release may make it easier to find a co-signer in the first place.

Repayment options and GRP

Sallie Mae offers a wide variety of ways to pay back your loan.

While you’re in school, you have:

  • Deferred repayment – no scheduled loan payments at all (though interest still accrues).
  • Fixed repayment – pay fixed amounts each month.
  • Interest repayment – pay interest only.

Once you graduate, you still have the option to make interest-only payments for 12 months — twice what many competitors offer.

Sallie Mae calls this their Graduate Repayment Period, or GRP (not to be mistaken for a Graduated Repayment Plan for federal student loans).

If you’re still struggling to make payments after your GRP, Sallie Mae can offer rate reduction, term and rate modification, payment extension, and/or a reduced payment plan based on your current financial situation.

In short, Sallie Mae’s backend flexibility more than makes up for their limited upfront terms.

Free Chegg tutoring

Another nice perk of borrowing from Sallie Mae is that you’ll get 12 months total of free tutoring from Chegg.

That’s four months each of Chegg Study, Chegg Writing, and Chegg Math Solver worth a combined $180. Note that this only applies to undergrad and graduate-level borrowers.

Non-citizen, part-time, and study abroad loan options

Drawing from their federal roots, Sallie Mae stands out from other private lenders by welcoming applications from DACA students. You just need a permanent resident with a good credit score (650+) to co-sign.

Sallie Mae also lets part-time students apply for loans, as well as students of online-only schools, winter or summer programs, and study abroad programs. Again, this is exceedingly rare among private lenders.

The Sallie Mae credit cards

Finally, Sallie Mae has its very own lineup of credit cards.

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Featuring names lifted straight from a Pokémon card, Sallie Mae’s Ignite, Accelerate, and Evolve cards charge no annual fee and feature student-centric points and perks like an easy-to-redeem sign-up bonus.

Source: Sallie Mae, screengrab by Chris Butsch


The Accelerate card is the standout, featuring the ability to redeem 2% cash back to help pay off your student loans. Plus, as Mastercards, all three of Sallie Mae’s credit cards include $600 worth of cellphone protection for damaged/stolen phones.

My personal take on Sallie Mae

I’ve said it before, but Sallie Mae really does remind me of Quicken.

  • Experience and brand awareness? Check.
  • Solid customer service? Check.
  • Not always the best rates, but tons of features and product options that (in some cases) make up for it? Check.

Based on everything I’ve researched — and from what I’ve heard from friends who’ve borrowed from Sallie Mae — this lender is worth adding to your short list.

That being said, bear in mind that applying for a private student loan should always be the last step on your college financing journey. Get the “free money” first — fill out your FAFSA, apply for scholarships, and be very, very careful considering your long-term ability to pay off your loan based on your chosen degree/career.

Read more: Everything you need to know about FAFSA (but were too afraid to ask)

Who should use Sallie Mae?

Sallie Mae is best suited for three groups of students:

  • Part-time, study abroad, Bar study, residency, and other students in non-traditional borrowing scenarios who may otherwise have limited options.
  • Students who may need an extended grace period after graduation to find stable income.
  • Students who are struggling to get a co-signer to commit. Hearing they could be off the hook as soon as 12 months post-grad could win them over.

Who shouldn’t use Sallie Mae?

The students who shouldn’t use Sallie Mae are simply those who can find a better fixed rate elsewhere.

Don’t get me wrong. Sallie Mae is robust, feature-rich, and by all accounts will take care of you. But at the end of the day, rates are king. For a $100,000, 15-year loan, securing a 1.00% lower APR could save you nearly $10,000.

Don’t write off Sallie Mae. But do shop around, starting with our list of the best student loans.