Suntrust Loan Consolidation: What You Need To Know

SunTrust is a bank that offers a variety of financial services, including loans. In the past, one of SunTrust's most popular services was its full line of education loans for college and graduate students. However, in 2020, SunTrust merged with BB&T to create Truist and ended its private student loan program. While former SunTrust student loan borrowers can no longer secure new loans from the bank, they can still explore refinancing options with different private lenders. SunTrust also offers consolidation loans for private student loans and other debts, such as credit card debt, auto loans, and more. Debt consolidation can help simplify finances by combining multiple loans into one, which can reduce stress and provide a sense of liberation. However, it is important to carefully consider the long-term financial implications before consolidating debt.

SunTrust no longer offers student loans

SunTrust was once a popular source of student loans, offering competitive interest rates and a full line of education loans for undergraduates and graduates. In addition to its loan services, SunTrust also provided students with valuable tools to help them prepare for their financial future, including tips on planning for college, a tuition guide, and an education budget calculator.

However, in May 2020, SunTrust announced that it was ending its private student loan program following a merger with BB&T to create the new entity Truist. As a result, SunTrust no longer offers new student loans, and loan servicing has been transferred to American Education Services (AES).

While this change may impact existing borrowers, it's important to note that their repayment schedules and other loan terms should remain unaffected. For those seeking new student loans, it is necessary to explore refinancing with different private lenders, comparing loan rates and considering the benefits of federal loans or other private lenders.

It is worth noting that debt consolidation can provide a sense of liberation and a boost to one's financial confidence. However, it is not a universal solution, and it is important to carefully review one's financial situation, including balances, interest rates, and credit score, before making any decisions.

Consolidating private student loans

Private student loans cannot usually be consolidated with federal student loans, and the low-interest rates on federal consolidation loans are not available for private education loans. However, SunTrust Bank does offer consolidation loans for private student loans, and you can receive up to $100,000, which is a higher maximum loan than most lenders.

If you are considering consolidating your private student loans, it is important to weigh the pros and cons. One key factor to consider is the interest rate offered by the new loan compared to your existing loans, as well as any potential fees associated with consolidation. It is also essential to evaluate the impact on the overall loan repayment term and consider the total amount of interest paid over time. Consolidation can simplify your finances by combining multiple loans into a single monthly payment, which can reduce your monthly payment amount and provide a liberating feeling. However, this may result in a higher total interest paid over the loan's lifetime.

Since the interest rates on private student loans are based on your credit score, you may get a lower interest rate through a private consolidation loan if your credit score has improved significantly since you first obtained the loan. Contact the current holder of your loans to see if they will reduce your interest rate, and review your balances, interest rates, and credit score before applying for a consolidation loan to ensure you are saving in the long run.

Consolidating student loans using an educational lender can simplify the loan repayment process and provide resources and support to help borrowers manage their student loan debt. However, if your private education loan has a variable interest rate, you might consider using a fixed-rate home equity loan to pay off the loan and lock in the interest rate, potentially providing more stability.

Consolidating other debts

SunTrust is not one of the few lenders legally permitted to offer federal student loan consolidation. However, the bank does offer consolidation loans for private student loans and other debts, such as credit card debt, auto loans, medical debt, store cards, gas cards, and payday loans.

Consolidating your debts can help you manage your finances better and reduce debt stress. It can also give you a fresh payoff date, which can be motivating and provide peace of mind. However, it is important to remember that debt consolidation may offer short-term benefits but may not be the best long-term solution. Before applying for a consolidation loan, it is advisable to review your balances, interest rates, and credit score.

If you have several credit cards with interest rates ranging from 18% to 24% but make regular, timely payments and have a good credit score, you may qualify for a debt consolidation loan with a lower interest rate of 7% to 10%. On the other hand, if your total debt exceeds half of your income, consolidation may not be advisable as it could result in a large monthly payment with less flexibility.

Additionally, while consolidating your debts can simplify your payments and provide a lower interest rate, it is important to compare the loan rates of the consolidation loan with your current rates. The consolidation loan is only beneficial if it offers a lower interest rate and reduces your monthly payment amount.

Pros and cons of debt consolidation

SunTrust Bank offers consolidation loans for private student loans and other debts, such as credit cards or auto loans. However, it is not one of the few lenders legally permitted to offer federal student loan consolidation.

Pros

Debt consolidation can be a good idea if you can secure a lower interest rate than you are currently paying. This will help you reduce your total debt and allow you to pay it off faster. It can also be a convenient way to streamline your credit repayment by combining multiple debts into one new loan with a single monthly payment. This can make it easier to keep track of your finances and reduce the stress associated with managing multiple debt streams.

Cons

Debt consolidation may not always be the best long-term solution. It is important to evaluate your financial habits, future goals, and current debt load before proceeding. Consolidation loans often come with fees, including annual fees, balance transfer fees, closing costs, and loan origination fees. These fees can add up to hundreds or even thousands of dollars. Additionally, if you have a low credit score, you may end up paying a higher interest rate on your consolidation loan than on your current debts.

While debt consolidation can provide short-term relief and simplify your finances, it is important to carefully consider the potential drawbacks and long-term implications before proceeding.

Alternatives to SunTrust for student loans

SunTrust, now known as Truist, no longer offers private student loan programs or accepts loan applications. The bank merged with BB&T Corporation in December 2019 to form Truist Financial Corporation, a top 10 US commercial bank.

If you are looking for alternatives to SunTrust for student loans, there are a few options to consider:

Federal Direct Consolidation Loan program

If you are overwhelmed with your federal student loan debt, you can consider the Federal Direct Consolidation Loan program. This program allows you to retain the benefits associated with a federal student loan while consolidating your debt. By consolidating your loans, you can reduce the number of monthly payments and potentially lower the monthly payment amount.

Private lenders for consolidation

While SunTrust does not offer federal student loan consolidation, it does provide consolidation loans for private student loans and other debts, such as credit cards or auto loans. You can consider consolidating your private loans through SunTrust or another private lender. This option may result in two monthly payments if you also have federal loans, but it can still help simplify your finances and reduce your overall payment amounts.

Other private student loan providers

Since SunTrust no longer offers private student loans, you may need to consider alternative lenders for this type of loan. Some options include Cognition Financial, which now offers the Custom Choice Loan previously provided by SunTrust, or other private lenders that can provide similar products.

Credit counselling and financial planning

Before choosing any loan or consolidation option, it is essential to review your financial situation, including balances, interest rates, and your credit score. Consulting with a financial expert can help you determine the best path forward and ensure that you are making informed decisions about your debt. Credit counselling agencies can provide guidance if you are unsure about managing your debt and exploring alternatives.

It is worth noting that debt consolidation may not be the best solution for everyone. While it can simplify multiple loan payments and provide a fresh start, it is crucial to compare loan rates and understand the long-term financial implications.

Frequently asked questions