Graduating from medical school is an incredible achievement. But if you're more in the mood to worry about your student loans than celebrate your graduation, that's understandable. If you're like many medical students, you have six figures in student debt--and several years of low-paying residency or fellowship ahead of you.
But you can be proactive about that debt--and one of the best ways to do it is by refinancing. We've scouted out some great under-the-radar deals for med students from SoFi, Laurel Road, and Splash Financial below.
SoFi has a special refinancing program for medical students, where you can reduce your payments to as little as $100 per month for up to 54 months. Keep in mind that unpaid interest will capitalize at the end of your residency (as it does in deferment), so make sure you're paying enough to cover the monthly interest if you're able to.
You'll still pay interest on your SoFi loan, but it could be considerably less than you'd pay even with a federal loan.
On the lower end, the interest rates SoFi offers are as low as 2.560% (the going rate for federal Direct Unsubsidized Loans disbursed on or after July 1, 2018 is 6.6%). There’s a .25% discount on interest rates for enrolling in AutoPay.
There are no prepayment penalties or origination fees, and their terms are five, seven, ten, 15, or 20 years.
In addition, SoFi offers some serious perks--including networking sessions, wine tastings, yoga classes, and career counseling help for its borrowers.
Laurel Road also offers a special deal for med students. Like SoFi, they’ll let you reduce your payments to a manageable $100 per month while you’re in residency. They’ll extend that period for six months after you’re finished with your residency, too. (Your interest does capitalize, however--so make sure you're paying enough to cover it).
If you’re already deferring your loan or in a grace period, Laurel Road honors that period—and won’t start your payments until it’s over.
Their terms are five, seven, 10, 15, or 20 years. The interest rates on fixed-rate loans range from 3.50% to 7.02% APR, and 2.50% to 6.65% APR on variable-rate loans. They’ll also knock off 0.25% for enrolling in AutoPay.
Another perk Laurel Road offers is a very generous referral program. If you refer someone else who refinances with them, you could earn up to $400 per referral.
See also: The Dollars and Debt of Doctors
Splash Financial specializes in refinancing for med students, although they also provide refinancing for other student borrowers. They even have a practicing physician—a nephrologist—on the board.
Splash Financial offers a program for medical residents that allows you to pay $1 per month on your student loans during residency, for a period of up to 84 months. Your interest will not capitalize until 90 days after your grace period ends.
(Again, we'll repeat what we said in the previous sections: make payments high enough to cover the interest if you possibly can, even if you're not required to, to keep your debt from getting larger.)
One other unusual thing about Splash is that they offer a very broad choice of loan terms, including three, five, seven, 10, 15, and 20 years. Their interest rates start at 3.25% on fixed-rate loans.
Should you refinance your medical school loans?
If you’re in medical school and are weighing your options, these lenders are worth a look. Try out their rate calculators and see how much you could save. It’s possible one of them could be the one that sees you through your residency.