What is Edly?
Edly Income-Based Repayment (IBR) Student Loans are unsecured educational loans issued by FinWise Bank, a Utah-chartered bank and a Member of the Federal Deposit Insurance Corporation (FDIC). Degree-seeking students at an Edly-supported school currently have two loan options: the Edly IBR No Cosigner Student Loan (for university students without a cosigner) and the Edly IBR Cosigned Student Loan (for university students with a cosigner).
Edly's mission is to:
- Enable their customers to take greater control of their financial lives
- Remove barriers to education and
- Remove the burden of unpayable debt for students
Income Based Repayment (IBR) loans are an alternative to traditional private student loans. It is no secret that many university students are dealing with excessive student debt, with this in mind Edly has spent years understanding the student loan debt crisis to offer access to affordable higher education.
How does Edly Work for College Students?
After you express an interest in an Edly IBR Student Loan, Edly checks to see which loans you may qualify for based on school, major, graduation date and how much money you need, and sends you an official offer with specific terms based on your information. If you are prequalified for an IBR Student Loan, you will be asked to submit an application and be subjected to a hard credit check. Upon accepting your application for a loan, Edly will send the information and funds over to your school to certify and your school will then disburse the funds to you.
With its flagship Edly IBR No Cosigner Student Loan, repayment begins no sooner than four months after graduation AND when you are earning more than $30,000. This lending model believes that graduates shouldn’t begin repayment until they can afford it. Borrowers who opt for the IBR Cosigned Student Loan make modest in-school payments in addition to their post-graduation payments.
What does Edly Offer?
Edly has the resources to help you meet your financial obligations of attending school without the stress of devoting the next decade or more to repaying your student loans when grants and scholarships don’t cover all your costs. Edly works with specific schools focusing on specific majors and programs. They look ahead at your potential earning value when issuing loans. Edly does not require applicants to have a cosigner for the IBR No Cosigner Student Loan, but borrowers who are declined or wish to have the added comfort of a cosigner can apply for the IBR Cosigned Student Loan. According to Edly, “students who meet the Edly requirements are three more times likely to qualify to be approved for an IBR loan without a cosigner than for a traditional private student loan” (https://student.edly.co/).
Income Based Repayment Loans (IBRs)
With research to back their Guiding Principles, Edly has created a lending product called an Income Based Repayment Loan (IBR). While similar to Income Share Agreements (ISAs), IBRs are based on your future income. If your yearly income falls below $30,000, you can apply for hardship forbearance. The interest begins accruing the day the loan is disbursed and continues to grow, even in forbearance. Once you reach the minimum income threshold and begin repayment, your loan payment increases as your income increases, thus being proportional to your income.
As a borrower, you don’t have to worry about any up-front fees and can expect a single simple monthly payment when you enter repayment. Using Edly’s Check Terms page allows you to check the specific loan terms that may be offered to you.
Repaying Your Loan
As per the terms laid out in your contract, your loan may be fulfilled by:
- Making 84 regularly scheduled, in-full, post-graduation payments
- Meeting the 2.25x repayment cap regardless of your income (i.e. a $10,000 loan would have a maximum repayment cap of $22,500) for the IBR No Cosigner Student Loan (the cap is 2.5x for the IBR Cosigned Student Loan).
- Paying your loan off early with the 23% APR cap added to the loan amount
- Reach the maximum repayment window of 12 years and adhere to all the terms of the contract
Comparing Income Based Repayment Loans vs. Traditional Private School Loans
Pros and Cons of Edly’s IBR Options
| Pros | Cons |
|---|---|
| When making at or above the threshold income ($30K) your loan is repaid once you make 84 in-full post-graduation payments | If you earn a high wage or want to pay your loan off early, you may end up paying 2.25-2.5x more than you borrowed (depending upon the loan type) |
| Edly does not require a cosigner and has a minimum FICO score for student borrowers (student borrowers without a FICO score may still be approved) although a cosigner IBR product is available for those borrowers who do not qualify for the no-cosigner product. | It may be more difficult to predict upfront how much you'll be paying in repayment, but the maximum repayment cost is 2.25-2.5x more than what you borrowed (depending upon the loan type) |
| If you are unemployed or your income level is less than $30,000/year you may request hardship forbearance (interest will continue to accrue during periods of forbearance) | Making less than the minimum threshold may add time to your overall repayment term |
| IBRs may not be available to all as there may be specific degree or major requirements | |
| Payments are considered flexible and easy to budget as it is a set percentage of your income | Taking out multiple IBR loans could require you to pay a larger percentage of your income during repayment. You may borrow between $5,000 and $15,000 per semester with an aggregate borrowing limit of $25,000. Each loan you take out is considered a separate loan and will have separate repayment terms |
| Your loan has a fixed cap on the amount you pay | If you choose to refinance, you must refinance at the pre-payment cap by paying their quoted payoff at the max APR listed on their Final Disclosure and IBR Note. |
How to Apply for an Edly Loan
- Begin by receiving an estimated quote and rate terms, which takes about 30 seconds.
- You will then officially apply for the IBR Student Loan and you will be presented with options which you qualify for.. Edly will run a soft credit check (which does not affect your credit score) to look for adverse credit history such as defaults or collections prior to your final approval.
- When you receive your final terms, carefully review and fully understand all the terms and conditions of the loan before accepting your loan. The terms of your loan (IBR percentage, initial monthly payment, initial APR and minimum income threshold) are all dependent on your school, year in school, major, intended graduation date, and amount needed.
- Upon accepting your offer, Edly will send your information to your school to be certified and disbursed.
Edly has made the application process simple and easy to move through for those who are eligible and qualify. It is designed to be affordable and adjust with your income as you progress through your career to be quickly and efficiently paid off.