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Navy Federal Student Loans Review (2021)

Navy Federal Student Loans

Navy Federal Credit Union provides student loans to people who cannot get federal loans or other types of federal benefits. It is one of the lenders with a long history; this organization’s foundation goes back to the Great Depression period. As a small group of naval employees created the organization, it is not surprising that it mostly serves the needs of military members, veterans, etc. Navy Federal student loans require borrowers to be Navy Federal Credit Union members to benefit from the offerings.

This guide explains the Navy Federal Credit Union’s private student and refinancing loans. As borrowers can have access to multiple private lenders, it is essential to be aware of their offerings and be able to evaluate them properly. Only in this way, students’ debt can be managed effectively, so we try to cover all necessary details of Navy Federal student loans in this guide.

How Much Can I Borrow?

Borrowers can get only the funds required by the school for the cost of attendance. Hence, it is possible to cover tuition fees, expenses for books, supplies, accommodation or equipment, if the school certifies these costs. However, it all depends on the school you are studying, your credit performance, etc. Keep in mind that the Navy can grant less than the required amount or not give a loan at all if the school does not certify private student loans.

Additionally, borrowers can choose to get funds for a semester or the whole academic year. It is advisable to apply for yearly cost because, in that case, the borrower will be checked for credit only once. However, if you are not sure about your future need for money, you can also apply for the semester’s cost. 

What are the Features of Loans?

Many private lenders provide useful features on loans to attract borrowers. Navy Federal student loans also allow borrowers to enjoy multiple features.


Auto-pay is one of these options that make the repayment process easier. If you let the company collect payments automatically from the bank account, you can get a 0.25% interest reduction. The authorization should be made through ACH – Automated Clearing House. 

However, achieving interest reduction is not easy. First, the borrower should grant automatic payments continuously. If you decide to stop the automatic payment, the interest reduction will stop until you reinstate this feature. 

Besides, Auto-Pay might be unavailable during the student loan forbearance or deferment period. Lastly, keep in mind that if you have a variable-rate loan, your APR cannot be lower than the floor level, together with the reduction received through Auto-Pay.

Cosigner Release

Another desired feature of Navy Federal student loans is cosigner release possibility. We will talk more about cosigners in the following sections. Hence, it makes sense to first explain what it is.

Cosigner Responsibilities

Navy Federal Student Loans

A cosigner is a third party like a family member or friend who supports your repayment claims. If the borrower fails to repay the debt, the cosigner becomes responsible. Hence, there are always eligibility conditions like credit history or stable income for cosigners if the loan requires one.

Besides, the loan’s credit performance affects the history of both borrowers and the consigner. If they successfully repay the student loan debt, the credit rating for both parties increase. Similarly, if the borrower cannot repay the loan, both parties’ performance gets negatively influenced.

Cosigner Release Requirements

Many people might hesitate to be a cosigner because they do not want to be responsible for someone else’s debt. Hence, the cosigner release feature allows borrowers to eliminate the need for a cosigner after making some payments. For Navy Federal student loans, the release is possible after the borrower makes 24 consecutive, full, and on-time payments. This process is approximately two years long, and it cannot involve any forbearance or deferment period. 

  1. No forbearance or deferment- this condition requires you to make 24 payments during the repayment period when you do not face deferment possibility, which is usually while studying and during the grace period.
  2. On-time payment- timely payments are made a maximum of 15 days past the due date.
  3. Full payment- you need to pay both the interest and principal payments while progressing toward 24 payments.
  4. Consecutive- the borrower must make repayment for 24 months straight by meeting all the qualification conditions mentioned above. 

Additionally, keep in mind that you need to request a cosigner release. In this case, the Navy Federal Credit Union will check your payments, income proof, and credit performance to decide if you qualify for cosigner release. It means the release is at the lender’s discretion, and it is not guaranteed.

Why have a Cosigner?

The existence of a cosigner increases the probability of repayment. A cosigner decreases the risk of non-payment for the lender because the company can collect the money from the cosigner if the borrower fails. Hence, having a cosigner can make the borrower qualified faster.

Especially if the borrower is in school and does not have a stable income source, there is no guarantee that they will repay the debt. Hence, many private lenders can reject their applications for student loans. However, if they have a cosigner, their chance to get the Navy Federal student loans will increase. 

Additionally, the less risky the borrower is, the lower the student loan cost. Hence, involving a cosigner can also save you some money. 

What are the Provided Rates?

Navy Federal student loans provide variable and fixed Annual Percentage Rate (APR). A fixed-rate indicates that the rate will not fluctuate based on some index. Sure, there can be rate changes, but the lender usually must inform the borrower before applying the change. A variable APR changes over time. It is possible to find how the rate will change in the agreement.

In general, Navy Federal student loans start from 3.16% variable ARP and 4.99% fixed APR, including the Auto-pay interest reduction benefit, at the time of this writing. The lender decides on the final rate considering the borrower’s credit performance and other qualifications. 

More Information on Variable Rate Loans

Variable-rate, as mentioned before, can change. Navy Federal informs the borrowers that their variable-rate APR might increase subsequently if the Annual Interest Rate varies based on the 90-day Secured Overnight Financing Rate (SOFR). However, notice that the

The loan term can be ten years of repayment period in addition to 5 years of deferment. These five years cover the period while the borrower studies or the grace period after graduation.

What are the Repayment Options?

Navy Federal Student Loans

Navy Federal student loans provide multiple repayment options. As it is possible to repay the debt even while studying, the borrowers can reduce the loan costs.

In general, there are two types of repayment plans:

  1. $25 monthly payment option
  2. Interest-only option

Under the first plan, during the period of studies and 6-month grace period, the borrower pays only $25 per month. Later, once the repayment period starts, the borrower pays both principal and interest monthly. Remember that you can pay only $25 during a maximum of 54 months (48 months for study + 6 months for grace period).

The second plan- Interest-only- allows the borrowers to repay interest when they are enrolled in school. The payment should be at least $25. Once the actual repayment period starts, the borrower pays the rest of the principal and interest. 

It is already visible from the repayment plans that the borrower will pay a minimum of $25 during the studies. Yet, this number is a minimum of $50 for the actual repayment process, which starts after the grace allowance. 

However, these options’ exact payment level depends on whether the student loan is fixed or variable-rated. 

Eligibility Requirements- Membership 

Navy Federal requires similar qualifications from borrowers as many other private lenders do. However, one of the biggest differentiation points is that Navy Federal requires borrowers to have a Navy Federal Credit Union membership. This membership is accessible to people on active duty, retired, and veterans. 

Besides, the family members of eligible military members, including grandparents, siblings, spouses, etc., can qualify for the membership. Civilian personnel of the Defense Department also can get the member status. 

Borrower Qualification

In addition to being a Navy Federal Credit Union member, borrowers need to satisfy other personal requirements. First, they need to be U.S citizens or permanent residents. The borrowers should meet the age of majority condition. The required age is usually 18 for most states, but there can be exceptions. 

Other student loans demand the borrower to be a current student/graduate in a qualifying school except for parent refinance loans. 

Additionally, the borrower should be able to pass the credit check. 

Cosigner Qualifications

As mentioned before, cosigners have the same responsibility as the actual borrower if the latter fails to repay the debt. Hence, it is not surprising that Navy Federal student loans require the cosigner to meet similar debtors’ requirements. For example, the cosigner should also be a U.S citizen, be 18 or older, and most importantly, get a Navy Federal Credit Union membership.

Keep in mind that the credit-check requirement also applies to cosigners. 

Qualifying Schools

Navy Federal Student loans are available to students of some schools. Not all educational institutions qualify for this opportunity. It is possible to see the eligible schools on the first page of the application process. For more information, note that loans are not available if you are enrolled to certificate programs, trade/foreign/for-profit/K-12 schools.

Additionally, as mentioned before, the school needs to certify the cost of education to determine the loan amount. Hence, if your school does not provide this document to private lenders, then you will not qualify for Navy Federal student loans.

Lastly, studying part-time or full-time is necessary. Anything less than half-time studies would not qualify for this funding option.

Application Process

Navy Federal Student Loans

If you want to apply for Navy Federal student loans, you need to provide some personal information, like your address, contact, educational qualifications, and Social Security Number. Besides, the borrowers will need the school to certify the cost of attendance, as mentioned before. 

The school determines the cost of attendance, and it can include the tuition fee, accommodation, transportation, book supplies, etc. Usually, the schools’ financial aid offices provide the total cost to the students. As Navy Federal wants to contribute for the amount you lack, it is necessary to provide the exact amount needed. Keep in mind that the lender still has a right to lend less than the required amount or not to lend at all.

Usually, the online application process takes around 15 minutes. At the end of the application, the borrower receives a preliminary evaluation. Next, the school should provide the certificate for the cost of education. The time spent on this process depends on the school operations. In general, from the time of online application till receiving the funds, 4-6 weeks pass. 


If you receive the Navy Federal student loans’ approval, the funds will directly be sent to the school officials. Usually, the school will take the necessary amount and apply it to your balance. The rest of the funds will be sent to the borrower. 

Additionally, note that the funds are mostly tax-deductible. 

How Navy Federal Helps with Job Opportunities

Navy Federal Credit Union cares about borrowers as much as they care about the repayment process. Borrowers with Navy Federal student loans get automatic access to the lender’s special job search-training platform. This platform helps borrowers to get ready for interviews, find job opportunities, and build attractive resumes. 

Refinancing Loans

Another service area of Navy Federal Credit Union is refinancing. Student loan refinancing can help borrowers to get lower interest rates, decrease their monthly student loan payments or pay out the debt quickly. The lender claims that borrowers refinancing loans worth more than $25,000 can save around $8,000. The saving can still change depending on the characteristics of each borrower’s loans. 

The lender provides two types of Navy Federal student loans for refinancing: student and parent refinance loans. Both federal and private student loans can qualify for these opportunities. 

Student Refinancing Loan

Student loan refinancing with Navy Federal delivers competitive interest rates. The rate for variable APR and fixed APR starts from 1.61% and 2.99%, respectively, at the time of writing. The loan terms can be 5, 10, or 15 years long. 

As student loans, refinancing loans also provide multiple beneficial features like 0.25% interest reduction through Auto-Pau and cosigner release. Differently, refinancing requires only 12 consecutive payments for cosigner release features, while private loans demand 24 months’ worth of payment. Other conditions for the cosigner release discussed in the above sections apply to the refinancing process, too. 

Additionally, keep in mind that you do not need to have multiple loans to benefit from refinancing. You can also refinance a single loan with a new loan with better terms from Navy Federal.

Parent Refinancing Loan

If you are the parent of a student who has higher-interest Parent PLUS or private loans, you can apply for refinancing through Navy Federal. In addition to the refinancing characteristics mentioned in the previous section, parent refinancing allows combining loans of multiple children. Besides, it is possible to refinance loans before the student graduates. 

Downside of Refinancing

Before rushing to get Navy Federal student loans for refinancing, you need to be aware of the downsides. This program’s major drawback is that it will make the borrower ineligible for federal aid programs. If you want to utilize forgiveness programs like Public Service Loan Forgiveness or get an income-driven repayment plan, you will not be able to access them after refinancing. 

Refinancing vs. Consolidation

Borrowers who want to simplify the repayment by combining loans can consolidate the loans instead of refinancing. In this case, the borrower will have a single loan, but he/she will not lose qualification for federal aid options. However, the debtors will not get other loan refinancing advantages, such as money-saving. Refinancing can bring lower interest rates and reduced monthly payments. On the other hand, a consolidated loan’s interest rate is the weighted average of combined loans. Hence, consolidation does not make the repayment faster or cheaper. 

Another significant difference is the coverage. Refinancing is possible both for federal and private loans. You can even refinance the same loan multiple times or refinance a consolidated loan. However, student loan consolidation is only accessible to federal debtors. It does not involve loans from private sources.

Navy Federal Loan Review

Navy Federal Student Loans

We discussed many elements in this guide. However, it will be helpful to summarize the pros and cons of Navy Federal student loans to help borrowers make informed decisions. 

Navy Federal Credit Union offers both fixed and variable rate loans on the bright side. The loans come with attractive features such as an interest reduction of 0.25% due to Auto-Pay. Another feature that most private lenders do not provide is the cosigner release opportunity. It is possible to eliminate cosigners after making 24 payments (or 12 payments for refinancing loans).

Additionally, Navy Federal student loans deliver exceptional customer support. They even help borrowers to find job opportunities.

On the other hand, there exist some downsides to this lender. First, the loans are only accessible to Navy Federal Credit Union members, who are mostly military service members. Second, for student loans, the only repayment period is a 10-year option. Besides, not all schools qualify for these loans. Lastly, as many private lenders, you will need to make payments during studying. 

Should You Prefer Navy Federal Loans?

Navy Federal loans are one of the best and most preferred options in the market. However, as it is a private lender, it brings the drawbacks that federal loans do not. Hence, if you have access to the federal debt, it can be wise to choose federal loans over private loans. 

Federal student loans usually have lower interest rates, which makes them more affordable for borrowers. Besides, such loans qualify for federal aid programs, such as forgiveness and loan discharge programs. It is also possible to choose among multiple repayment plans to make the payout easier for the students. 

Lastly, if there are unexpected situations, the government can step up to protect the well-being of borrowers. For example, during the COVID-19 pandemic, borrowers are unable to repay their debt. Hence, the government granted many forbearance periods with no interest accumulated. Currently, President Joe Biden granted an 8-month long non-collection period. However, such government-initiated programs mostly do not cover the private borrowers.

Private borrowers can also receive some help from lenders if they face financial challenges. Some lenders grant forbearance options as long as one year or a skip-a-payment feature, which allows borrowers not to make one monthly payment during a year. However, if financial trouble persists, like the negative influence of pandemic, there is little that lenders can help. They mostly will require the borrower to resume payments shortly after the forbearance benefits. 

Contact SLR for Guidance

We understand that all the possible funding options and their eligibility or application conditions can be overwhelming. None wants to get student debt; even more, people do not wish to owe more than the acceptable amount. Hence, borrowers attempt to find the most affordable option to be able to repay the debt later.

If you feel lost among options and need guidance, you can contact our debt specialists. Under the Student Loans Resolved roof, we gathered industry experts to help Navy federal student loans borrowers make the right decisions. With years of experience and knowledge of debt-related matters, our specialists are able to analyze your financial conditions and suggest the most suitable solutions. Whether you need to find a source to cover education costs or want to get rid of your accumulated debt, we lend a hand to you. Our debt experts know which programs will work the best for your debt issues. Besides, we guide you through the whole process and be on your side whenever you need us.