What is Multi-Year Student Loan Approval? -Bankrate.com | Vette Leader

Multi-year approval is a student loan option that lets you see how much money you can borrow for your entire degree with a single loan application. This, in turn, can make it easier for you and your family to plan your finances and give you peace of mind that your college expenses are covered. However, there are some considerations to keep in mind before applying.

Instead of allowing borrowers to apply for a loan each academic year before they begin college, some private lenders offer borrowers a multi-year approval option for their student loans. This feature allows students with a creditworthy co-signer to secure funding for multiple academic years with a single application and just one hard credit request.

Mindy Hager, senior vice president of student lending at Citizens Bank, says when students and their families complete their application, the lender will look at them holistically, rather than just focusing on what they can afford today.

“If a family comes in during the student’s freshman year and wants to borrow, say, $15,000, we see if they can basically sustain that amount over a four or five year period,” says Hager. “Then we approve them the full amount of $15,000 times four or five, so we tell them, ‘You have $60,000 or $75,000 that’s available for this borrower’s entire education.'”

Of course, the lender will not give you the full amount in a lump sum, just the amount you applied for that academic year, which in this example would be $15,000. But you have the peace of mind that over the next few years, you can come and apply for any amount up to that $60,000 or $75,000 cap and you’ll be approved — as long as your credit score and financial situation stay more or less the same.

It’s also worth noting that although you will be pre-approved for the funds, your interest rate and terms will not necessarily be the same for all of your loans. With the multi-year option, you still have to choose an interest rate (fixed or variable) and a term for each loan you apply for. Additionally, interest rates from private lenders fluctuate based on market conditions, which means that even if your credit rating and income remain the same (or even better), there’s always a chance you won’t be able to get exactly the same interest rate as you originally secured.

Not every lender offers multi-year approval, and those that do each have their own version of this feature.

citizen bank

Citizens’ Multi-Year Approval allows borrowers to complete the student loan application online or through the company’s mobile app. Once you’ve filled out the form, the system will automatically let you know if you’re eligible for multi-year admission. From there, all you have to do is tick the box to accept this option and sign the papers.

Also of note is that Citizens Bank allows you to take your loans with you, meaning you can switch colleges and still be eligible for the multi-year option. However, to remain qualified, you must apply with the same co-signer each time and pass a soft credit check.

college avenue

College Ave Multi-Year Peace of Mind will let you know if you are eligible for multi-year admission during the online application process. At this point, you can also choose the type of interest you want for the first loan, as well as the repayment period.

However, in order to remain pre-approved for future loans, your school must verify that you meet the guidelines for satisfactory academic progress. You must also pass a gentle credit check.


Discover lets borrowers know if they’re eligible for the multi-year option during the loan application process, which can be done online or over the phone. In the coming years, a large part of the loan documents will already be filled out.

Discover requires you to use the same co-signer and pass a soft credit check to remain prequalified, and you must be in the same school and program that you listed when you first applied.

Sallie Mae

Sallie Mae will let you know if you are eligible for the Multi-Year Advantage after you complete an online or phone application. Sallie Mae allows you to keep the multi-year option even if you change programs or schools. However, you will be subjected to a gentle credit check with every loan request.

Having all your loans under one roof comes with a number of benefits, including:

  • Faster Approval. Your lender already has all of your information on file and each application is pre-filled for you. All you have to do is verify that the information is still correct, sign the papers and you’re done.
  • Less impact on your credit score. Hard credit requests can lower your credit score by up to 10 points and stay on your report for up to two years. Earnest CEO David Green says that by choosing multi-year approval, you avoid further dips in your credit score because the lender only performs a soft credit check on all future loans.
  • More savings. Most lenders offer a standard interest discount of 0.25 percent for signing up for automatic payments. But if you’re a returning borrower, you may be eligible for additional loyalty discounts and rewards. Citizens Bank, for example, offers a loyalty discount of 0.25 percent on every additional loan you take out with the company.
  • Easier repayment. Using the same lender allows you to manage and pay for all of your loans in a single hub, eliminating the need to switch from one lender’s website to the next. This can also come in handy if you decide to refinance in the future, as you don’t need to seek statements from multiple lenders.

Applying for a multi-year license is fairly easy. All you need to do is select a lender that offers this option and have the following on hand to complete the application:

  • Your school’s information.
  • Your expected completion date.
  • Your desired loan amount.
  • The period of study for which you need funding.
  • A copy of your passport, driver’s license or other government-issued identification.
  • your social security number.
  • Your contact information.
  • Copies of your last two payslips, W-2s, or tax returns (if applicable).
  • Your employer’s contact information (if applicable).

If you are applying with a co-signer, you must also provide that person’s name, contact information, social security number, income and employment details. Some lenders may also require that you provide one or more personal references as part of the application process.

The lender uses this information to determine whether you are eligible for the loan, in addition to your eligibility for multi-year approval. If you are eligible for multi-year approval, you can select the multi-year option before signing the loan.

How to apply for funds for each school year

Hager says the lender will contact you after your academic year is over to see if you want to apply for another loan for the next year. If you haven’t received a bill from your school by the time you call, don’t worry – you can always apply later.

Once you’ve got the numbers together and see how much you need, go to your lender’s site and log into your account. There you will see the option to apply for another loan as part of your multi-year approval plan. This new application will already be filled out for you with the information from the last year.

As a final step, the lender will perform a gentle credit check to ensure your financial circumstances have not changed drastically over the past year. If everything is in order, you will be approved for the funds and the money will be sent to your school.

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