Cornerstone is one of the many Federal loan servicers that has been approved by the Department of Education, so if you have student loans, then there is a good chance you are working with Cornerstone.
They have been in the student loan industry for the past 35 years offering exceptional customer service to student borrowers across the nation. While they may not be the most well-known company, they definitely have a lot to offer and won’t be leaving the playing field anytime soon.
Cornerstone commits to a few key principles when it comes to the financial services they offer. First, they maintain integrity; for instance, they will keep your information protected with a commitment to confidentiality and identity protection. They are extremely focused when it comes to their customers, offering great customer service and understanding that there’s no “one size fits all” formula for borrowers.
At any rate, this is what Cornerstone claims to be about. With this in mind, it seems that they would be the all-around perfect package- right? Let’s not make our final decisions just yet though.
While you don’t initially get a choice on your student loan servicer, you can manage to transfer loans between servicers during repayment. You should do some “shopping” before making a change, so you should do some research before making the final decision. Luckily, we decided to do the research for you.
Let’s take a closer look into Cornerstone student loans and see how they stack up against other servicers. Without further ado, let’s look closely into everything that Cornerstone has to offer for a student loan debtor in repayment.
What Does Cornerstone Have to Offer?
Just like every student loan servicer, Cornerstone has a lot to offer their borrowers. First and foremost, let’s take a look at the benefits of working with Cornerstone. They offer benefits such as interest rate reductions with automatic payments, interest rebates when you make your payments on time, and interest rate reductions for Cornerstone Direct consolidation loans. These are all great ways to save money when it comes to repaying your student loans, especially since these seem to reward successful payments.
To be eligible for the interest rate reduction after setting up automatic payments, you will need to already be in repayment. That means instead of being in grace period, forbearance, or deferment, you need to be actively making payments to Cornerstone. You will also need to ensure that your payments are not kicked back because insufficient funds can actually kick you out of the automatic payment program. An interest reduction of 0.25% may not seem like much, but it adds up considerably over the life of a loan.
Cornerstone also offers a variety of benefits for armed forces members. If you are a serviceman or servicewoman, you can take advantage of the following benefits when you choose Cornerstone as your student loan servicer: SCRA Interest Rate Cap of 6% while in active duty status, military service deferment, public service loan forgiveness, 0% interest when deployed to a hazardous area, income-based repayment plans, Department of Defense loan repayment options, and access to the HEROES Act waiver. These are just additional perks that Cornerstone offers to service members as a way to thank them for their diligence when it comes to protecting our country and our freedom.
Cornerstone also offers several student loan forgiveness programs. If you are a public service employee at a non-profit organization or government job, then you may be able to qualify forgiveness. Once you make on-time payments for at least ten years, you may be eligible. Teachers can also qualify for student loan forgiveness as long as they meet the eligibility requirements.
As you can see, Cornerstone definitely has a lot to offer when it comes to benefits for borrowers. The only problem is that they do have limitations to their services. It is important to understand these limitations since they may hinder you in the long run. A big limitation surfaces when you mention the term “refinancing.”
Is It Possible to Refinance Student Loans Through Cornerstone?
Often times, student borrowers want to look into other options when it comes to repaying their student loans. Many borrowers decide that refinancing their student loans is the way to go. The problem is, there are not that many federally approved servicers that offer both consolidation and refinancing options. While you cannot refinance your student loans through Cornerstone, you can consolidate them. While very similar, consolidation and refinancing are inherently different for one major reason: interest rates.
Consolidation through Cornerstone is much like other consolidation options from Federal loan servicers. They offer Direct consolidation loans that allow borrowers to consolidate their individual student loans into one larger loan. Consolidation, in and of itself, does not save any money since the new consolidated loan interest rate is a weighted average of all previous loan interest rates. That means that your rates may not actually be lower across the board. Consolidation usually makes repayment easier, but it normally ends up costing more over the life of a loan.
If you are looking for something that will save you a little bit more, then you may want to check with some of the private lenders that offer refinancing options. Typically, when you refinance with a private lender, you are able to lock in a lower interest rate (his is heavily dependent on your credit history). Keep in mind that private refinancing negates any benefits under a federal loan, but that is the price you pay to get a better deal on your loans which it is well worth it for many borrowers.
The Bottom Line
Although Cornerstone does have some valuable resources for student borrowers, it doesn’t always mean that they are the absolute best option for your student loans. In fact, many borrowers that have their loans through Cornerstone didn’t actually pick them in the first place. When you take out federal student loans, you will be assigned to a particular servicing company, without really have much of a say in it.
If you want to have more say so in your student loans, a private lender may actually be the best way to go. Even if you already have some loans through the federal student loan programs, you will still have the ability to consolidate and refinance those loans through a private lender that may offer you a better rate of interest for your student loans.
Just remember, if you do opt to go with a private lender, they take credit history into account, so borrowers with poor credit will have less luck. Most lenders want you to have a FICO score that is in the mid to upper 600’s and let’s face it- many recent college grads just don’t have that kind of creditworthiness. The good news is that many of the lenders will allow you to have a cosigner on the loan to help you ensure approval even with less than perfect credit.
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