The Bank of North Dakota is a unique institution as the only state owned bank in the country. Established in 1919 it has built an enviable reputation amongst the nations banks. As a provider of private student loans it offers the Dakota Education Alternative Loan on excellent terms. Applicants are however limited to students who either reside or attend school in North Dakota, South Dakota, Minnesota, Montana, Wyoming or Wisconsin. Students within these six states are well advised to consider the Bank of Dakota if their student loans requirements cannot be fully met through federal student loans.
The bank requires all students under the age of 24 to have a responsible co-signer with a minimum FICO credit score of 575. However co-signer release is available after 24 consecutive timely monthly payments if the borrower has established credit. Loans are issued over a ten year repayment period with the first payment due since months after graduation. Longer payment terms can be arranged if DEAL loans are above $30,000. The bank encourages students to start repaying the loans whilst in college to avoid the principal growing due to compounded interest.
DEAL loans carry an administration fee of 3 percent. The fee may be waived for all students who reside in North Dakota, whether attending a state school or out of state school. The fee may also be waived for out of state students who attend school within North Dakota. Students from a state other than North Dakota who attend a college that is not in North Dakota will be subject to the 3 percent fees.
Loans are available with either fixed or variable interest rates, at very competitive rates. The current fixed ARP is 6.02 percent, and the variable, which is based on the Libor, 1.75 percent. Once again students from a qualifying state that is not North Dakota, who also attend a college outside North Dakota, will find they are subject to higher rates. In addition to the fees, loans attract interest of 3.39 percent variable, and 7.71 percent fixed.
Students may typically find that they can find lower rates than these latter two from other lenders but often the rates offered are scaled depending upon credit. Thus those with a less than perfect credit score may find other lender’s rates reflect that in a higher interest rate whilst the Bank of North Dakota offers one rate across the board. All interest rates can be reduced by 0.25% if students elect to make repayments by automated debit.
In addition to offering student loans at competitive rates the Bank of North Dakota stands out as a lender due to the personal service reputation it has acquired, and the transparency of its loan products. Students who meet the six state requirements should definitely consider DEAL loans as an attractive private alternative to more faceless lending institutions.