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When you want to help pay for your child’s education, you have a choice. The Smart Option Student Loan offers an alternative to the Federal PLUS Loan for Parents. It offers competitive interest rates and features like no origination or disbursement fees, an opportunity to apply for cosigner release, the option to select interest, $25 fixed, or deferred repayment option during school and grace, and more. And, highly qualified applicants could receive an interest rate lower than with the Federal PLUS Loan for Parents. Compare your options before making this important decision.

  Smart Option Student Loan® for Undergraduate Students Federal PLUS Loan for Parents

Your role

You cosign the loan and share the responsibility of paying it back with your student You take the loan out in your own name and are responsible for paying it back

Primary borrower

Your student You, the parent

School enrollment status

Enrolled full-time, half-time, or less than half-time in a participating school Enrolled at least half-time in a participating school

Interest rates

LIBOR + 1.50% to LIBOR + 12.13%
(1.25% APR to 11.10% APR)

4.50% to 13.38%
(4.25% APR to 12.35% APR)

Lowest APRs shown include the auto debit discount


5.30% for academic year 2020-2021

Origination/disbursement fees

None 4.236% for loans first disbursed on or after October 1, 2019, and before October 1, 2020

Principal and interest repayment term

5 – 15 years 10 – 25 years

Cosigner release

Your student may apply to have you released from the loan after they graduate, make 12 on-time principal and interest payments, and meet certain credit requirements
Not applicable


0.25 percentage point interest rate reduction for enrolling in and making payments by automatic debit 0.25 percentage point interest rate reduction for automatic debit enrollment

Ready to apply?

Smart Option Student Loan for Undergraduate Students

For bachelor's and associate's degrees or a certificate at a degree-granting school.

Apply for this loan

Learn more about the Smart Option Student Loan

Questions on which is the right loan for you?

Call us at 877-279-7172

Borrow responsibly
We encourage students and families to start with savings, grants, scholarships, and federal student loans to pay for college. Students and families should evaluate all anticipated monthly loan payments, and how much the student expects to earn in the future, before considering a private student loan.

This information is for undergraduate students attending participating degree-granting schools. Borrowers must be U.S. citizens or U.S. permanent residents if the school is located outside of the United States. Non-U.S. citizen borrowers who reside in the U.S. are eligible with a creditworthy cosigner (who must be a U.S. citizen or U.S. permanent resident) and are required to provide an unexpired government-issued photo ID to verify identity. Applications are subject to a requested minimum loan amount of $1,000. Current credit and other eligibility criteria apply.

Explore federal loans and compare to ensure you understand the terms and features. Private student loans that have variable rates can go up over the life of the loan. Federal student loans are required by law to provide a range of flexible repayment options, including, but not limited to, income-based repayment and income-contingent repayment plans, and loan forgiveness and deferment benefits, which other student loans are not required to provide. Federal loans generally have origination fees, but are available to students regardless of income.

Only the borrower may apply for cosigner release. Borrowers who meet the age of majority in their state may apply for cosigner release by providing proof of graduation (or completion of certification program), income, and U.S. citizenship or permanent residency (if your status has changed since you applied). In the last 12 months, the borrower must be current on all Sallie Mae-serviced loans (including no hardship forbearances or modified repayment programs) and have paid ahead or made 12 on-time principal and interest payments on each loan requested for release. When the cosigner release application is processed, the borrower must demonstrate the ability to assume full responsibility of the loan(s) individually and pass a credit review that demonstrates a satisfactory credit history including but not limited to no: bankruptcy, foreclosure, student loan(s) in default, or 90-day delinquencies in the last 24 months. Requirements are subject to change. Shortest qualification period based on a August 14, 2020 review of national private loan programs offered by publicly-traded competitors.

  This repayment example is based on a typical Smart Option Student Loan made to a freshman borrower who chooses a variable rate and the Fixed Repayment Option for a $10,000 loan, with two disbursements, and a 10.81% variable APR. It works out to 51 payments of $25.00, 119 payments of $191.03 and one payment of $121.54, for a Total Loan Cost of $24,129.11. Variable rates may increase over the life of the loan.

Federal student loan information was gathered in July 2020 from and a July 1, 2020 Electronic Announcement from Federal Student Aid, an office of the U.S. Department of Education.

Interest is charged throughout the life of the loan—beginning with disbursement, during school, through any grace/separation period, and ending when the loan is paid in full. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. Payments may be required during the grace/separation period depending on the repayment option selected. Variable rates may increase over the life of the loan. Advertised variable rates reflect the starting range of rates and may vary outside of that range over the life of the loan. Advertised APRs assume a $10,000 loan to a freshman with no other Sallie Mae loans.

Borrower or cosigner must enroll in auto debit through Sallie Mae to receive a 0.25 percentage point interest rate reduction benefit. This benefit applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month and may be suspended during periods of forbearance or deferment, if available for the loan.

Sallie Mae loans are made by Sallie Mae Bank.

Information advertised valid as of 10/1/2020.