Overwhelmed by all your options when it comes to refinancing your student loans? You’re not alone.
Refinancing your student loan debt can save you a lot of cash—an average of $253 a month or $16,183 over the life of your loan. (Get a ballpark idea of how much you could save with our calculator.) But choosing the right lender is key.
Luckily, you don’t have to give yourself a headache over this—because we’ve done the research for you.
|Interest Rates (APR)||ReFi Loan Types||Variable Rates (APR)
|Fixed Rates (APR)
|Hybrid Rates (APR)
|2.43% - 7.82%||Variable & Fixed||2.43% - 7.21%||3.50% - 7.82%||N/A||5 to 20|
|2.80% - 6.69%||Variable & Fixed||2.80% - 6.01%*||3.39% - 6.69%*||N/A||5, 7, 10, 15, 20|
|2.44% - 7.50%||Variable & Fixed||2.44% - 6.87%||3.64% - 7.50%||N/A||5, 7, 10, 15, 20|
|3.24% - 7.02%||Variable & Fixed||2.50% - 6.65%||3.50% - 7.02%||On request||5, 7, 10, 15, 20|
|2.48% - 6.25%||Variable, Fixed & Hybrid||2.48% - 6.25%||3.20% - 6.25%||4.29% - 6.34%||
5, 7, 10, 15, 20
Hybrid: 10 years
|2.430% - 8.074%||Variable & Fixed||2.430% - 6.650%||3.49% - 8.074%||N/A||5, 7, 10, 15, 20|
|3.10% - 7.84%||Variable & Fixed||3.10% - 7.84%||3.75% - 7.03%||N/A||5, 8, 12, 15|
|2.93% - 9.99%||Variable & Fixed||2.93% - 9.67%1||3.89% - 9.99%1||N/A||5, 10, 15 & 20|
Are you one of the 8 million Americans who could be getting a better deal? A Goldman Sachs report estimated that $211 billion in student loans are ripe for refinancing – about 70% of private student loans and 25% of loans from the Federal Family Education Loan Program.
Wondering if you're a good candidate for refinancing or consolidating your student loans? Here's what these companies look at when considering your application:
Your creditworthiness is crucial. You'll be a good candidate if your credit score is in the 650 to 850 range.
Banks want your credit score to be high, but they also want your debt-to-income ratio to be low — less than 36%. Calculate your ratio by adding all monthly debt payments and then dividing that sum by your gross monthly income (what you earn before taxes).
A responsible finance history assures a bank that you are a low risk. Being current on your bills, credit cards and student loans is an important loan criterion.
Banks review your employment and income history.
Grads represent lower risk and have higher approval rates.
|Credit Score Minimum||Average Refi
|Minimum Debt Amount For Refinancing||Maximum Debt Amount For Refinancing||Minimum Income Requirements|
|650||Good||$5,000||$500,000||No Set Requirement|
|660||Good||$5,000||$125K: Undergrad $250K: Graduate $300K: Medical/Dental/Vet||$2,000/
|660||N/A||$5,000||No Max||No Min Required|
|660||700+||$5,000||$500K||No Min Required|
|650||Good||$5,000||No Max||No Min Required|
|680||Good||$10,000||$90K: Undergrad $225K: Grad/Doctoral $300K: Dental/Medical/Law||$24,000|
A new loan with a lower interest rate will decrease your monthly payment, which may enable you to pay off the loan faster. If you are looking for more money in your budget today, you can refinance your student loans for a longer period of time—spreading out your payments, reducing your monthly bill.
If your private or federal student loans have an interest rates of 4% or higher, refinancing will likely save you money. Parents can also save money by refinancing their PLUS loans, which typically have higher interest rates than student loans.
You will lose eligibility for federal income-driven repayment plans if you refinance your federal student loans. Examples are Income-Based Repayment (IBR), Income-Contingent Repayment (ICR), Pay As You Earn (PAYE), and the Revised Pay As You Earn (REPAYE) plan. These plans decrease monthly payments if you have a low income, lose your job, or experience economic hardship.
Student loan forgiveness is for federal employees, teachers or those who work in a public service. If you work in one of these fields and you have been consistent in your payments, you could be eligible to have your federal student loans forgiven. Once you refinance, these benefits will no longer be available to you. If you are eligible for student loan forgiveness, we recommend calculating whether student loan forgiveness or refinancing will save you more money over the life of your loans.
Many students apply with a co-signer, often a parent or grandparent, when they first take out college loans. This enables young people with little or no credit history to get lower interest rates. But once you’ve been out of school for a few years, you may want to release your loved one from responsibility. Removing a cosigner from the original loan can be a difficult bureaucratic struggle. Refinancing can be a much simpler way to get everything in your own name.
|Average Savings (Monthly)||Average Savings (Yearly/Lifetime)||Auto Pay||Loyalty / Account Discount||Fees & Penalties|
|N/A||N/A||Yes - 0.25%||No||None|
|$191||$16,657||Yes - 0.25%||No||None|
|N/A||$20,000+||Yes - 0.25%||No||None|
|$323||$24,046||Yes - 0.25%||No||None|
|N/A||N/A||Yes - 0.25%||No||None|
|N/A||$29,340||Yes - 0.25%
(For resident product)
|$212*||$2,544/year*||Yes - 0.25%3||Yes - 0.25%2||None|
Earnest empowers people with the financial capital they need to live better lives. Using technology, data, and design to build affordable products, Earnest's lending products are built for a new generation seeking to reach life's milestones. The company understands every applicant's unique financial story to offer the lowest possible rates and radically flexible loan options for living life.
Education Loan Finance is designed to assist borrowers through consolidating outstanding education loans into one single loan that effectively lowers your costs of education and/or makes repayment very simple. Education Loan Finance - backed by the strength of SouthEast Bank - combines the benefits of traditional education loan refinancing with the superior products, service, and support found in the private market.
Check out their low rates today to see how much you can save.
Attractive Bonus and Referral Programs:
LendKey operates student loan programs for over 275 not-for-profit and community lenders across the country. By partnering with these lenders, LendKey is able to give consumers direct access to the best rates available from the most borrower friendly institutions. As the servicer of all loans obtained through its platform, you can rest easy knowing your personal information will be safe and that the best customer service team will be ready to answer your questions from application until your final payment.
Laurel Road is a national online lender with customers in all 50 states, the District of Columbia, and Puerto Rico. Many of our non-bank competitors are not able to lend in all 50 states.
Laurel Road has grown to be the second largest player in the student loan refinancing space in large part because of our reputation as the go-to low rate provider.
CommonBond was founded in 2011 by three MBA graduates from the University of Pennsylvania’s Wharton School who wanted to help their peers escape from high-interest student loan debt. Its original focus was on grad students, but it has since expanded to cover undergrads as well.
Of all the companies we reviewed, CommonBond has some of the best customer service. The company prides itself on being easy to reach by email, phone, or live chat. It offers networking events, expert panels, insider newsletters, and even has a program help borrowers who lose their jobs to find new ones. CommonBond also makes you feel good about choosing to refinance with them by donating money to an education nonprofit for each loan they write.
Get a personalized review of your refinancing options with CommonBond today.
SoFi, which stands for “Social Finance,” was created by a group of Stanford business students who found themselves with a mountain of debt after graduation. They set out to change the student loan industry and help borrowers like themselves to get lower interest rates. SoFi has some of the lowest interest rates and, unlike the other lenders we reviewed, it has no maximum amount you can finance. However, Nevada residents can’t currently refinance with SoFi. Minimum loan balances are higher in Arizona, Massachusetts and Pennsylvania due to state laws. Additional state restrictions may apply.
Splash Financial is a leader in student loan refinancing with new rates as low as 3.25% fixed APR which can save you tens of thousands of dollars over the life of your loans. No application or origination fees and no prepayment penalties. Splash Financial is in all 50 states and is intensely focused on customer service. Splash Financial is also one of the few companies that offers a great medical resident and fellow refinance product. You can check your rate with Splash in just minutes.
Click here to see more of Splash's offerings and to see how you can save money.
Student loan borrowers are already saving money with Citizens One. Check their offerings to see how you can save money.
Over the past decade, we’ve seen dramatic changes in technology, medicine, politics – and now college loans. The emergence of innovative startup firms that specialize in refinancing student loans have created a competitive environment with attractive new options for borrowers. If you’re struggling under the weight of college debt, now is a great time to find out if you could save money by bundling or renegotiating your loans. It’s easy to find out, and there are no prepayment penalties, origination fees, or application fees.
What is a variable interest rate?
A variable interest rate is one that can change based on the terms of the loan. For instance, a variable rate may be 3% early in the year but 4% later in the same year. A change in the general economy can cause such a fluctuation. For instance, when mortgage rates increase, the student loan variable rate will also increase. Any loan not locked into a rate will go up or down over time. Federal student loans aren’t issued with variable rates, but private student loans may or may not be.
What is a fixed interest rate?
Fixed rate student loans keep a constant interest rate: a loan issued with a fixed rate of 3.5% will maintain that interest rate, even years later.
What are the pros and cons of each?
The primary benefit of a fixed interest rate is that your payment amount won't change. For most people, a fixed interest rate is preferred. It's easier to budget, and there are no surprises. A variable interest rate is a benefit if the rate is lower and you’re planning on paying off the loan in a year or less. In that case, you don’t have to worry too much about interest rate increases, which will add to your monthly payment.
Check your credit report.
AnnualCreditReport.com is the only source authorized by federal law to provide free annual credit reports. On this site, you can get your credit report for free each year from each of the three major credit reporting agencies - Equifax, Experian and TransUnion. Once you get your report, spend the time to make sure it is correct. If you find anything inaccurate, contact the specific credit reporting bureau to dispute and remove them. A bank will typically require you to have a credit score that is over 650 to refinance student loans.
Pay down credit card debt.
You can improve your credit score and your chances of being approved for refinancing your student loans if you pay down the debt on your credit card. If you have high balances with high interest rates, consider consolidating those to credit cards with lower-rates. Then, work on paying down all of your balances to below 30% of your credit limit. When you pay down the debt on your credit card you boost your credit score.
Look for a co-signer.
If your credit isn’t as strong as you would like it to be, find a parent, spouse, or family friend with strong credit to co-sign the student loan refinance application with you. A co-signer not only improves your chances of getting approved, but could also help you get a lower interest rate on that new loan.
When you are ready to apply to refinance your student loans, get the following documents in order: