How Discover Student Loans’ exit will impact borrowers

What Discover’s exit means for your student loan

Discover’s student loan business is changing. According to Discover’s website, “Discover will no longer accept new student loan applications after January 31, 2024. Applications received on or before January 31, 2024 will be processed as usual.” If you have a Discover student loan or were thinking about taking one out, don’t worry—we’ve got some answers to the questions you might have.

Why is Discover exiting the student loan business?

Discover is transferring the Discover Student Loans portfolio and the servicing of their loans to a third-party provider to focus their efforts on other key business objectives.

Discover’s interim CEO and President John Owen said that “Discover’s Board regularly reviews the strategic fit of all of our businesses, with a focus on providing exceptional customer service and allocating resources to optimize returns.” After a regular review, it was “determined that exploring the sale and transfer of servicing of Discover’s student loans is aligned with those priorities, better enabling Discover to focus on our core banking products, capitalize on our growth opportunities and deliver long-term shareholder value,” said Owen.

What will happen to my student loan payment if I currently have a loan with Discover?

If you have a student loan with Discover, don’t worry—your loans and payments won’t be affected at all for now, according to Discover. All current loans will eventually be serviced by a third-party provider that has yet to be announced.

Where should I look if I’m in need of more money for school?

You should exhaust all your other options before you start looking for another private student loan lender.

1. Always look for free money first. Scholarship Search by Sallie is the perfect way for to find scholarships that match your background, major, the state you live in, and more.
2. Fill out the FAFSA® to see what scholarships and grants you may be eligible for. From there, you can see what federal student loans you’ve been offered, too.

If you still need more money for school and a private student loan is your next option, Sallie Mae is a great choice to consider. We’re the best in the business, and we’re dedicated to helping you responsibly plan and pay for school and get you ready for whatever’s next. Powering confidence is our thing, and you can feel confident that Sallie Mae is more than ready to help you make it through school.

Everything will be okay

It’s normal to be wary of change, especially when it’s unexpected, but there’s support for your student loan situation if you need it. Be on the lookout for upcoming communications from Discover.