AmSouth was originally a Southeastern regional bank based in Birmingham that opened in 1873 and survived the Depression, acquiring less fortunate banks in the process. From the 1940s through the 1960s, the bank expanded and formed a holding company in 1971, to further continued acquisitions. It took the AmSouth name in 1981 and started expanding outside Alabama in 1987 when it made a foray into Florida.
AmSouth continued to buy banks in other states, moving into Tennessee and Georgia and making its largest acquisition ever in 1999, when it bought First American Corporation of Nashville. Amsouth and another large Alabama bank, Regions Financial, merged in 2006 to create the entity now known as Regions, with $140 billion in assets. As it turned out, 2006 was the last year of unmarred prosperity before the recession began, which presented a special challenge to the newly created bank.
Consequently, in 2012 Regions no longer offers student loans, but refers student loan customers to national lender Sallie Mae. Regions is paid for the referrals and hosts a link to Sallie Mae on its site, and the resulting page carries the Regions brand, but the student loan is a standard Sallie Mae product and not in any way distinct in how it works.
The Smart Option Student Loan for Regions Bank Customers
The Smart Option Student Loan is Sallie Mae’s standard student loan, and like all student loans from private lenders should be considered only after you have exhausted all other options for financing your college education. That is because private lenders treat students like any other customer, and you will not find the same flexibility in terms or advantageous rates.
So with the caveat that you should borrow the minimum necessary (and you must borrow at least $1, 000), Sallie Mae will let you borrow the amount of the costs certified by your school with the Smart Option loan. You will note that on the linked page, much of the vital information about the loan appears in the small print at the bottom of the page.
There are three repayment plans available, and the one you choose affects your interest rate. You will pay more if you choose one of the other two plans than you will if you choose the Interest Repayment Option, because the more interest you pay at the beginning of the loan, the less unpaid interest can be added to your balance later when you enter full repayment status. Full repayment means your monthly payment includes both principal and interest.
The three plans are described briefly on the site as follows:
- The Deferred Repayment Option does not require any minimum payment while you are still enrolled in school. You may pick the amount and frequency of what you send, but be advised that the less you pay the more you will eventually owe. The unpaid interest that accumulates while you’re in school and for six months thereafter (the grace period) will be capitalized, or added to your loan balance.
- The Fixed Repayment Option lets you pay a small amount each month that is calculated according to your loan amount while you’re enrolled. The same interest capitalization occurs as above, though, so you should always pay as much as possible.
- The Interest Repayment Option, which is the least costly, involves paying interest on your loan while you’re still in school.
Note: If your school does not grant degrees, then your loan will be even more expensive, with an origination fee of 5% and an APR between 7.99% and 13.62%.