Got a private student loan with Discover? You could stick with them—or you could refinance your loan, score a lower interest rate, and laugh all the way to the bank.
So, how, exactly, do you refinance your Discover student loan? All you need to do is check competitor's rates and apply—the whole process takes about 15-20 minutes. We'll walk you through it.
First things first: Refinancing means replacing an existing loan with a new loan—along with a new interest rate and new terms. It’s the closest thing you get to a do-over on your student loan.
When you refinance, your new lender pays off all your existing loan or loans for you and then issues you a single new private loan. You make payments to one place—not to multiple lenders. That’s one benefit of refinancing—it makes your loans easier to manage.
See also: How Much Student Loan Debt Do I Have?
It also makes your loan cheaper. Ideally, you get a lower interest rate with your new loan—and in a lot of cases, it’s a lot lower. According to our data, most people who refinance can lower their payments by $253 a month or save over $16,000 over the life of the loan.
If your credit score is better now than when it was when you originally took out your Discover student loan, you could qualify for a lower interest rate if you refinance.
Ideally, you want to have maybe four or five lenders to choose from. Here are some criteria to use:
The main point of this exercise is to score a lower interest rate. Each lender will offer you a different rate, based on your credit score and financial history.
You don’t have to go through an entire application process to get a ballpark figure—a lot of lenders have a student loan refinancing calculator on their website (here’s ours).
Once you’ve narrowed the field further, you can put in an application and get an initial offer from the lenders on your shortlist (more on that in a sec).
You’re going to be working with your new lender for a while, so hopefully they’re good with customer service. Read online reviews. Ask around with people you know. Put the question out on social media.
Some people may have had bad experiences--but some lenders really do have great customer service. CommonBond, for instance, has won awards for theirs.
Want to stretch your loan out to 20 years so you can save month-to-month? Or how about paying it off in five so you can realize more savings over the life of your loan? Either way, make sure the lender offers loan terms in that range.
Other factors may make a lender the right fit for you. For instance:
Once you’ve picked a lender you’re interested in, you can apply through their website. The process shouldn’t take more than about 20 minutes—but may vary depending on the lender.
During the application process, you'll be asked about:
Once you submit this info, the lender will do a “soft pull” to determine your credit score. This doesn’t show up on your credit report, so know that's it's totally fine to check out several lenders.
After the soft pull, you'll receive initial offer. If you decide to proceed, the lender will then do a hard pull on your credit to get you a final offer.
If you pull the trigger on that, they’ll handle all the paperwork to switch your loan over from Discover to your new, lower-interest-rate loan. However, be sure to keep paying on your Discover loan until you've verified that the balance has been paid off by your new lender.
Refinancing could save you a large chunk of change—and reset the terms on your student loan. If you have a Discover student loan, it’s definitely worth considering.
Curious about refinancing? See how much you could save. Check out Refi Ready.
Works with 275+ not-for-profit community lenders for higher approval chances
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.
Offers unemployment protection and career/coaching/networking
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.
For every loan they fund, they contribute to the education of a child in need
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.
Earnest empowers people with the financial captial 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.
Click here to apply with Earnest and to see how much you can save.
Operates in all 50 states; 2nd largest student loan refinancing lender
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.
Special offers for medical resident and fellow refinance products
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.