Nitro Knowledge. Your Guide to Paying for College.
Want to improve your finances in the New Year? You aren’t alone. Financial resolutions are among the most common, with people resolving to get out of debt, save more money, and clean up their spending.
But “spend less” and “save more” may not cut it. Most people don’t keep their New Years resolutions—not from lack of willpower, but because they don’t have concrete ideas about how to keep them.
Maybe you need to reduce your monthly student loan payment so you can save money. Perhaps you’re on a mission to get out of debt sooner, or it could be that your interest rate is 6.5% or higher and you believe you can beat that rate.
For sure, there are any number of reasons why refinancing your student loans is a smart strategy.
Paying student loans is a fact of life for more than 70 percent of college graduates – but paying too much for those student loans doesn’t have to be. Many people don’t realize that once they’ve been out of school for a few years, they could be eligible for lower interest rates on their private student loans.
Most people with student loans owe at least some of that money to the federal government. Government-backed loans are usually the first step for borrowers, and with good reason. They are widely accessible, have fixed interest rates, and carry many benefits. But there are some significant drawbacks, too. Among the biggest is that there is no way to renegotiate the interest rate through the federal government if economic conditions change.
Refinancing student loans can be a great strategy to make monthly payments more manageable and cut overall interest costs. In recent years, the number of lenders offering refinancing has increased, creating a competitive environment with lots of innovation and new options. But picking a lender can be daunting. Which student loan refinance company is the best? What should you consider besides the interest rate? Which lender should you trust with your money?
If you feel like your monthly student loan payments are barely making a dent in your loan balance, it might be time to see if you qualify for a lower interest rate. In fact, lowering your interest rate by even 1% can save you thousands of dollars over the life of your loan.
So how can you get a lower interest rate? Here's what you need to know.