Sallie Mae lends into the United States private education market, which serves the funding gap left after scholarships, savings, and federal aid. The company states that it is the leading private student lender and that it has operated for more than 50 years.
Origination is funded through deposits raised at Sallie Mae Bank and through loan sales, including forward-flow arrangements under which institutional investors commit to buy newly originated education loans.
Private education loans are priced on borrower credit, with an interest-rate discount available to borrowers who enroll in automatic payments. The in-school repayment choices trade a lower payment now for more interest accrued before repayment begins.
The bank pays published yields on high-yield savings, money market, and certificate-of-deposit accounts, and charges no monthly maintenance fee on those savings products.
