It’s alternative lending week at The Wall Street Journal. First on Wednesday, Jane Kim profiles person-to-person lenders Prosper and Lending Club (here). Supporting e from our earlier work at Online Banking Report (see Online Banking Report #127, and note 1, 2).
Today, Anne Marie Chaker looked at Web-based student loan marketplaces (here). In the case of College Loan Market and Student Loan Scout, a full application, including credit check, is required. But that allows participating lenders to offer firm financing quotes, similar to LendingTree’s approach in the broader loan market online payday loans. Apparently, this student loan sector is seeing increased activity, and scrutiny, due to the recent conflict-of-interest scandals at a number of college financial aid departments.
Each market works differently, but the basic approach is to get detailed info from the prospective borrower, then provide the borrower with a variety of specific loan options from specific lenders
- College Loan Market
- eStudent Loan
- Insight by Graduate Leverage
- Simple Tuition
- Student Loan Scout **Not yet open for business**
Of the five, only eStudentLoan has an inviting appearance, with big orange “Web 2.0” students and parents buttons and the all-imporant name-dropping of its lenders along the bottom (see screenshot below).
1. Our original forecast was published in OBR #127 in ; the model was updated and the forecast increased by about 5% in . The updated numbers were cited in the Wall Street Journal article. We are increasingly bullish on the space and will publish updated forecasts this fall.
A fter a slow start, with no new entries during its first week, the student loan blog from Wells Fargo is off and running. Since its Sep. 5 launch, the site has averaged about two posts per week, each running 300 to 400 words, a good length. (See inset for jump page to the bank’s two blogs, )
Furthermore, the writing is surprisingly good, with little corporate-speak, a trap that’s so easy to fall into when every word has to be approved by a team of attorneys and compliance officers. Interestingly, the one off-topic post, written by the freelancing college-student mom, Caroline Hansen, was pulled from the site a day or two after it was posted. Either her step-daughter, or more likely, Wells Fargo management didn’t like the story about her new tattoo.
The site is obviously aimed at parents, with warnings about credit card abuse and an instructive post about transferring money online to pay for a $573 book tab (ouch!).
While the bank does a good job of not blatantly pitching its products, it seems that most links within the posts lead to a wellsfargo page. The blog would have more credibility, and readership, if it linked to more outside resources.
Wells Fargo Launches a New Blog, The Student LoanDown
Wells Fargo launched its second blog today, The Student LoanDown . The site, which is not yet mentioned on the main Wells Fargo site, is designed to offer guidance on the student loan process (click on inset for closeup).
The first post claims they won’t try to sell anything. It’s a claim not technically accurate since there are several links to the corporate lending site, and a position that’s not really necessary. As long as you are upfront about the corporate affiliation, it’s OK to highlight your own products and services PROVIDED it’s done in a way that is both interesting and useful.
The website is powered by Six Apart’s Moveable Type and launched with just a single post from two of its four listed authors. Wells Fargo joined the so-called blogosphere back in March when it launched an odd site called Guided by History, a look back at the 1906 San Francisco earthquake and what we can do today to be better prepared for natural disasters.