Do you have a SoFi student loan? Did you know you can refinance that loan to a lower interest rate—either with SoFi or someone else? Well, you totally can.
And why would you want to do that? You can lower your monthly payments by over $250 a month by refinancing—or over $16,000 over the life of the loan. Here’s a look at refinancing—what it is, the benefits and drawbacks, and how to refinance your SoFi student loan.
Many student borrowers have a patchwork of student loans when they graduate—some federal, some private. They’re all serviced by different lenders.
This can lead to a confusing routine of managing and making payments to numerous loans every month.
When you refinance, you take out a new loan with a new lender. The lender pays back all your loans, and then issues you a single new loan for the total amount you owe. You get a new interest rate and new terms. And you get to make only one payment per month.
The most important benefit of refinancing is that you get a new—preferably lower—interest rate. This can save you thousands.
You can also increase or decrease your term—either to pay the loan off faster or reduce the amount you pay per month. Depending on your financial goals, either choice could work really well for you.
You also get different perks. If you have federal loans, you lose the federal benefits: deferment and forbearance, income-based repayment, and student loan forgiveness. That’s one of the major drawbacks.
However, some private lenders offer flexibility if your finances change. SoFi offers a deferment program for those who qualify, for instance. Some lenders will let you make interest-only payments over the life of your loan, or will work with you individually if you need help.
It’s worth checking with any new lenders about their policies and programs in this area if you’re considering refinancing.
If you’re considering refinancing, SoFi is a strong choice.
They offer both variable and fixed interest rates, and those range from about 3.890%-8.074% (for fixed-rate loans) or 2.500%-7.115% (for variable rates).
They put a lot of effort into building a community and fostering careers for college grads. Their programs include a career advisory service, where an advisor helps you hone your resume and refine your personal brand.
They also support entrepreneurs by offering an accelerator program highlighting member companies. If you’re starting a business, they’ll give you a six-month deferment to get it started. And they even offer seed capital for select businesses.
Their member events go beyond careers, though. They offer cooking classes, wine tastings, yoga classes, happy hour meet-ups, cycle classes, and more in major cities throughout the country.
Maybe. Even if you like SoFi, it’s worth it to shop around.
Here are some questions you should ask:
Can they offer a better interest rate than what you're currently paying? Lenders all have different criteria for deciding what interest rate to offer you. It’s usually based on your credit score, payment history, employment situation, and current debt load, among other factors.
How long is the term of the loan? A shorter term will result in a higher monthly payment, but you’ll get your loan paid off faster—while paying less interest.
A longer term will reduce your monthly rate, but you’ll pay more interest over the long term and take longer to pay back your loan.
What makes this lender stand out? Does the lender offer flexibility if you hit a financial snag? How socially responsible is this lender--and are they known for giving back to the community? Any other perks, like the ones for entrepreneurs and career-minded borrowers like SoFi offers?
What are the fees? SoFi doesn’t charge an origination fee, and most reputable lenders don't. But a few do, and it's always worth checking. Other fees are sometimes charged for late payments, providing loan verifications or histories, and other things. It's a good idea to ask for an itemized list so you aren't hit with surprises.
What are the discounts? Most lenders—SoFi is one—will take off 0.25% if you enroll in AutoPay. Some lenders offer additional discounts on top of that--for instance, if you open an account with them.
What do their customers say? Check out forums and review sites, and talk to people you know who’ve refinanced with specific lenders.
Refinancing with SoFi could be an excellent financial decision. But there are lots of other great lenders out there as well. Do some research and compare rates, and you should find the one that’s right for you.
Use our online calculator to find out how much you could save by refinancing. There's never been a better time to find out!
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.
Many ELFI customers save hundreds per month month and thousands over the length of the loan term.
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:
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.
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.
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.
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.
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.