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.1 

It offers competitive interest rates and features like no origination or disbursement fees, an opportunity to apply for cosigner release,2 the option to select interest, $25 fixed,3 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.1 Compare your options before making this important decision.

Smart Option Student Loan® for Undergraduate Students

Federal PLUS Loan for Parents4

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

 SOFR + 2.88% to SOFR + 14.00%
( 2.62% APR to 12.97% APR5)


4.00% to 14.75%
(3.75% APR to 13.72% APR5)

Lowest APRs shown include the auto debit discount


7.54% for academic year 2022-2023

Origination/disbursement fees


4.228% for loans first disbursed on or after October 1, 2020, and before October 1, 2022

Principal and interest repayment term

10 – 15 years5

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 requirements2

Not applicable


0.25 percentage point interest rate reduction for enrolling in and making payments by automatic debit6

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.

Questions on which is the right loan for you?


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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.

Sallie Mae loans are subject to credit approval, identity verification, signed loan documents, and school certification. This loan is available to students at participating schools and is not intended for students pursuing a graduate degree. Student or cosigner must meet the age of majority in their state of residence. Students who are not U.S. citizens or U.S. permanent residents must reside in the U.S., attend school in the U.S., apply with a creditworthy cosigner (who must be a U.S. citizen or U.S. permanent resident), and provide an unexpired government-issued photo ID. Requested loan amount must be at least $1,000. 

1. Explore federal loans and compare to make sure 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.

2. Only the borrower may apply for cosigner release. To do so, they must first meet the age of majority in their state and provide proof of graduation (or completion of certification program), income, and U.S. citizenship or permanent residency (if their status has changed since they applied). In the last 12 months, the borrower can’t have been past due on any loans serviced by Sallie Mae for 30 or more days or enrolled in any hardship forbearances or modified repayment programs. In addition, the borrower must have paid ahead or made 12 on-time principal and interest payments on each loan requested for release. The loan can’t be past due when the cosigner release application is processed. The borrower must also demonstrate the ability to assume full responsibility of the loan(s) individually and pass a credit review when the cosigner release application is processed 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. 

3.  Examples of typical costs for a $10,000 Smart Option Student Loan with the most common fixed rate, fixed repayment option, 6-month separation period, and two disbursements: For a borrower with no prior loans and a 4-year in-school period, it works out to a 9.63% fixed APR, 51 payments of $25.00, 119 payments of $172.95 and one payment of $121.42, for a Total Loan Cost of $21,977.47. For a borrower with $20,000 in prior loans and a 2-year in-school period, it works out to a 10.07% fixed APR, 27 payments of $25.00, 179 payments of $125.36 and one payment of $49.52 for a total loan cost of $23,163.96. Loans that are subject to a $50 minimum principal and interest payment amount may receive a loan term that is less than 10 years.

4. Federal loan rate and fee information is provided by Federal Student Aid, an Office of the U.S. Department of Education.

5. Interest is charged starting when funds are sent to the school. 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 borrower who attends school for 4 years and has no prior Sallie Mae loans.

6. The 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. It may be suspended during forbearance or deferment. 

Sallie Mae loans are made by Sallie Mae Bank.

Information advertised valid as of 7/25/2022.