Cornerstone is legit. They're a federal student loan servicer hired by the Department of Education to handle loan payments, income-driven repayment plan requests, deferments, etc.
What is Cornerstone Education Loan Services
As I shared above, Cornerstone is a federal loan servicer hired to help student loan borrowers with all aspects of their student loan debt. They didn't buy your loans. They don't own your loans. They simply process your student loan payments and send reports to the Department of Education about your account.
The Department doesn't own Cornerstone. Instead, they're owned by the Utah Higher Education Assistance Authority (UHEAA) which is a state government agency.
What does this have to do about your loans? Not much.
Cornerstone services federal student loans
If your loans are with Cornerstone, then your loans are not private student loans. They're federal student loans (usually loans made under the Direct Loan program and the Federal Family Education Loan program).
More specifically, they're federal loans owned by the U.S. Department of Education. And because they're federal student loans, they're eligible for various loan forgiveness programs and student loan repayment plans
Here are the types of federal loans they may service:
- Direct Subsidized Loans, including consolidation
- Direct Unsubsidized Loans, including consolidation
- Direct Plus Loans, including some Parent Plus Loans
- Federal Family Education Loans and
- Perkins Loans
You have plenty of loan repayment options to manage your monthly payments.
If you want to pay your loans off quickly, there's the 10-year Standard Repayment plan.
Or, if you're having some type of financial hardship, you may need a lower monthly payment amount. In that case, you can choose a plan based on your income. If those payments are too high or if you're looking to buy a house, you may want to look at the Extended and Graduated plans. Both plans offer you a lower payment amount to start, but the payments will increase every two years.
Lowering the interest rate
There's no good way to lowering the interest rate on a federal loan.
Sure, you could agree to set up autopay out of your checking account, but that only gets you a small interest-rate reduction.
Applying for a Direct Consolidation Loan doesn't help. With loan consolidation, your new interest rate is the weighted average of the loans you consolidated. So when it's all said and done, you don't end up with much of a lower rate.
Refinancing may work.
But that's not always a great solution.
First, to refinance your loan amount without a cosigner, you have to have a good credit score.
Second, even if your credit report is solid, refinancing with a private lender to get a better rate means you'll lose access to forgiveness programs and income-based repayment plans.
In my opinion, losing those things is not worth it for most borrowers to save a few dollars.
Student loan forgiveness
The federal government offers two main types of loan forgiveness to student loan borrowers:
- Forgiveness at the end of an income-driven repayment plan and
- Public Service Loan Forgiveness.
Each IDR plan forgives your remaining student loan debt after you make a certain number of monthly payments (240 or 300 months of payments; 20/25 years). You'll have to pay taxes on any amount forgiven.
As for the PSLF program, you qualify for it if, among other things, you work full-time for the government or a nonprofit.
NOTE: If you work full-time for a qualifying employer and you want to try to get your loans forgiven, you'll want to transfer your loans to FedLoan Servicing. To do that, contact FedLoan Servicing. They'll have you complete a PSLF employment certification form. After you submit that form, your Cornerstone student loans will be sent to FedLoan for servicing.
Contact information for Cornerstone student loans
Cornerstone Student Loans
PO Box 145122
Salt Lake City UT
Phone number: (800) 663-1662
Cornerstone customer service representatives are available M-F.