Discover Student Loans

If you are considering a private student loan to help you afford college in addition to your federal student loans, then you may have heard of Discover. They are a large company, after all, with a powerful brand.

But just because you know the brand doesn’t mean they are the right lender for you. Below, we answer all of the most common questions that borrowers have about Discover student loans so that you can make a more informed decision about how you finance your college education.

Who is Discover?

Discover is a financial institution that provides a range of services and products to its customers. Though it is most well-known for its line of credit cards (including the Discover Card), the company also offers online banking, personal loans, home loans, and student loans.

Discover History

Interestingly, Discover started life in 1985 as a subsidiary of the Sears Financial Network. In 1993, Sears sold the financial services portion of its business, including the Discover Card, which became Dean Witter, Discover & Co. In 1997, the company merged with Morgan Stanley. In June of 2007, Morgan Stanley spun off Discover as a stand-alone, publicly-traded company.

Types of Student Loans Offered by Discover

Discover offers many different types of student loans that prospective borrowers may want to consider, including:

  • Undergraduate Student Loans: For borrowers pursuing either a bachelor’s degree or associate’s degree
  • Graduate Student Loans: For borrowers pursuing a graduate degree
  • Health Professions Student Loans: For borrowers pursuing a graduate degree in a medical field such as Allopathy, Dentistry, Nursing, Occupational Therapy, Optometry, Osteopathy, Pharmacy, Physical Therapy, Physician Assistant, Podiatry, or Veterinary Medicine
  • Residency Student Loans: For borrowers who need funding while they complete their medical school residency
  • MBA Student Loans: For borrowers pursuing their MBA
  • Law School Student Loans: For graduate borrowers attending law school
  • Bar Exam Student Loans: For borrowers who need funding while they study for the Bar Exam
  • Parent Loans: For parents who want to help their children pay for college

Discover also offers what they call a “Consolidation Loan,” but this is a misleading term. Discover’s Consolidation Loan actually refers to student loan refinancing.

Discover Interest Rates

As a private lender, Discover is free to charge whatever they wish for their student loans. This is very different from federal student loans, which carry an interest rate that is set by Congress.

While Discover used many factors to set its interest rates, some of the most important include:

  • Whether or not you apply with a cosigner: Applying with a cosigner makes you a less risky borrower. This may help you qualify for lower interest rates, and may also increase your chances of being approved for a loan.
  • Your credit history: Your credit score is a number designed to tell a lender how risky it will be to lend to you, based on your past actions. The higher your credit score, the less risky you are seen to be, and the lower rate you may qualify for.
  • Your income: Whether or not you have a current source of income, and how much you make, can influence your interest rates.

One important note: All private lenders, including Discover, tend to advertise their lowest possible rate in order to attract borrowers. These rates are often reserved for borrowers with an excellent credit score, and include any applicable discounts or rewards. The lowest rates are also often tied to variable rate loans, which fluctuate over time with the underlying credit market.

How to Apply for a Student Loan Through Discover

Borrowers interested in applying for a Discover student loan can do so by either visiting their website and clicking “Apply” or by calling the number at the top of the screen. To complete the application, you will need:

  • Your Social Security Number
  • Information about the school you will be attending, including your field of study and your academic period of enrollment
  • The amount that you need to borrow
  • A list of any other financial aid you will receive
  • Financial information, including about our monthly rent or mortgage payment and any source of income
  • Your permanent address, your school address, and contact information

Upon filling out the information in the application, you will need to select either a fixed or variable interest rate as well as the repayment option you wish to pursue. Choosing to submit the application will involve a hard credit check; there is no pre-approval process. If you are approved, you will see the interest rates offered, and you can choose to accept or reject them.

If you are applying with a cosigner, they will also need to submit an application.

Discover Pros and Cons

Pros of Borrowing a Student Loan from Discover

  • No fees: Discover does not charge loan application, origination, prepayment, or late fees.
  • 0.25% interest rate reduction: Borrowers who opt into auto pay can receive a 0.25% interest rate reduction.
  • Multi-year option: Upon applying for your first year’s worth of loans, you will also find out if you pre-qualify for future loans, which can help you make a decision about how you plan to fund your entire college education as a whole.
  • Cash reward for good grades: Incoming college freshman or undergraduates and graduates with at least a 3.0 GPA may qualify for a one-time cash reward for each new loan they take out through Discover. It is typically equal to 1% of the loan amount.
  • Multiple types of student loans: The increased variety of loan types for graduate students can help borrowers pursuing certain degrees save money over the life of the loan.

Cons of Borrowing a Student Loan from Discover

  • No pre-approval process: Unlike many other private lenders, Discover does not offer a pre-approval process. The only way you can see whether or not you are approved, and what your interest rates will be, is to submit a full application. This will involve a hard credit check.
  • Limited deferment options: Federal student loans, by law, offer borrowers the ability to defer or forbear their student loans in certain circumstances. While Discover may offer some limited forbearance options, they are almost certainly not as generous as those offered by federal loans.
  • Not eligible for forgiveness: Federal student loans are under certain circumstances forgivable. This is not true for most private student loans, including those offered by Discover.
  • Interest rates not set by law: Whereas the interest rates charged by federal student loans are set by law, Discover is a private lender. This means that they can set their own interest rates and determine their own criteria for what these rates will be. Most borrowers will pay higher interest rates compared to federal student loans.
  • No guaranteed acceptance: A a private lender, Discover can set its own eligibility requirements, which means that some borrowers will not be approved for a loan. This is in direct opposition to unsubsidized undergraduate federal student loans which are made available to borrowers regardless of credit score or financial situation.

How to Contact Discover

If you would like to contact Discover to discuss their student loan offerings, you can do so through any of the means below. Student loan Specialists are available 24/7.

Discover Student Loans Phone

1-800-STUDENT (1-800-788-3368)

Discover Student Loans Fax


Discover Student Loans Email

If you are an existing Discover borrower, you can send Discover a secure email by logging into your Discover account. If you are not an existing customer, then you cannot communicate by email.

Discover Student Loans Address


Discover Student Loans
PO Box 6107
Carol Stream, IL 60197-6107

Application Documents

Discover Student Loans
Customer Service
PO Box 30947
Salt Lake City, UT 84130-0947

General Correspondence

Customer Service
PO Box 30948
Salt Lake City, UT 84130-0948

Alternatives to Discover

Before turning to any private student loan lender, borrowers should be certain that they’ve exhausted all other forms of funding to pay for college. Federal student loans, state-based student loans, and institutional student loans all typically carry lower interest rates and more favorable borrower terms compared to private loans, making them our recommended first stop for all borrowers.

If after you have climbed all other funding you still decide that you need a private loan to fill any gaps, you should be sure to do your homework to find the lowest possible interest rates that you can qualify for. While you can do this on your own by comparing lenders, a much easier way is to turn to a student loan marketplace that allows you to compare multiple lenders side by side.