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Helping individuals pay back their student loans through refinancing as low as 2.13%

Nate Matherson is the CEO and co-founder of LendEDU, an online platform for student debt refinancing. LendEDU allows its users to compare rates between 12 different student loan lenders, including SoFi, LendKey, iHelp, Education Success Loans, College Ave Student Loans, Upstart, and more. Nate started the company with his dormmate, Matt Lenhard, at the University of Delaware in 2014; since then, LendEDU has graduated the Iowa Startup Accelerator and Y Combinator business accelerator programs, and has been featured in media outlets such as The New York Times, The Wall Street Journal, CNN, Bloomberg, NPR, CBS News, Fox News, TechCrunch, and many others.

EDWIN WARFIELD: Could you describe your business model? What advantage does refinancing offer to individuals with student loans?

NATE MATHERSON: Student loans is a very unique credit market. At least 90 percent of people who take out student loans as they go into college get the same exact interest rates. If you go to college and you don’t work hard, you don’t graduate, and you’re a failure, you get the exact same interest rate as somebody who went to college, works three jobs, graduated with a 4.0, and got a great job out a college. When students go into college, they all get the same interest rate regardless of their intellect, regardless of their credit score, regardless of their job, regardless if they get a degree.

When everyone gets the same terms for their student loan, the market is imperfect. Today, there are over $400 billion in student loans that have interest rates above 7%. I, myself, have student loans at 8.5 percent. It’s not fair to those [high-performing] individuals because they’re lower risk.

That’s what student loan refinancing does: It helps the people who have gotten good jobs. It helps the people who worked hard in college. It helps the people who have built themselves a good credit score, to get lower interest rates. They’re lower risk for banks, and so those people that do have high interest student loans and who are a lower risk for banks should get lower interest rates. Right now, I guess that is about $400 billion in loans that should be refinanced debt.

Say you’re paying 12%—people are paying as high as 12% on a student loan—when you refinance them, you can get as low as 2%. You can save a lot of money through refinancing.

LendEDU gets paid by the lenders that we market on our website. We get paid a cut of the loan, but we only get paid when we actually close that loan. We get paid when the customer saves money, refinances to a lower rate; and we get paid when we make our banks money for closing that loan. The interests are aligned throughout the entire process.

Student loans is a very big issue. I think how we look at student loans today is not going to be how we look at student loans two or three years from now. For LendEDU to thrive, we need to think about how we can help people in other areas with their finances, too. That would expand our market and help people in other ways.

Connect with Nate on LinkedIn

Sponsored by:

ABOUT NEWMARK GRUBB KNIGHT FRANK

Newmark Grubb Knight Frank (NGKF) is one of the world's leading commercial real estate advisory firms. Together with London-based partner Knight Frank and independently-owned offices, NGKF's 14,100 professionals operate from more than 400 offices in established and emerging property markets on six continents.

With roots dating back to 1929, NGKF's strong foundation makes it one of the most trusted names in commercial real estate. NGKF's full-service platform comprises BGC's real estate services segment, offering commercial real estate tenants, landlords, investors and developers a wide range of services including leasing; capital markets services, including investment sales, debt placement, appraisal, and valuation services; commercial mortgage brokerage services; as well as corporate advisory services, consulting, project and development management, and property and corporate facilities management services. For further information, visit www.ngkf.com.

NGKF is a part of BGC Partners, Inc., a leading global brokerage company servicing the financial and real estate markets. BGC's common stock trades on the NASDAQ Global Select Market under the ticker symbol (NASDAQ: BGCP). BGC also has an outstanding bond issuance of Senior Notes due June 15, 2042, which trade on the New York Stock Exchange under the symbol (NYSE: BGCA). BGC Partners is led by Chairman and Chief Executive Officer Howard W. Lutnick. For more information, please visit http://www.bgcpartners.com/.

Edwin Warfield, CEO of citybizlist, conducts the CEO Interviews.

If you're interested in reaching CEOs, please contact edwin.warfield@citybuzz.co

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