applied for refinance in the past week
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A student loan refinance involves replacing one or more student loans with a new loan with better terms from a private lender. Both private and federal student loans can be refinanced. The purpose of refinancing is to get a lower interest rate and thereby reduce the monthly payments and lifetime costs. Many private lenders, including banks, online lenders, and credit unions offer student loan refinance loans. People with federal loans can also consolidate—rather than refinance—their debts. This involves combining multiple federal loans into a single loan with one simple monthly payment. The table below shows a sample of rates for student loan refinances compared to rates for first-time private and federal student loans. The Refinance column shows the lowest rates advertised by each lender. The First-Time Column shows fixed rates for federal government loans and lowest rates from private lenders.
|Refinanced Student Loans||First-Time Student Loans|
1.74% (with autopay)* Variable /
2.47% (with autopay)* Fixed (Credible)
|1.24% Variable / 3.75% fixed (Credible)|
|1.74% Variable /|
2.44% Fixed (Earnest)
|6.6% (Federal Stafford Unsubsidized)|
|1.74% to 6.59% APR (with AutoPay) Variable /|
2.49% to 6.94% APR (with AutoPay) Fixed (SoFi)
|5% (Federal Perkins Loan)|
|1.74% - 7.49% Variable /|
1.99% - 7.84% Fixed (Splash Financial)
|4.236% (Federal (PLUS Loan)|
|2.49% Variable /|
2.59% Fixed (CommonBond)
|1.44% Variable / 5.45% Fixed (CommonBond)|
|1.92% (with autopay) Variable /|
2.95% w/ autopay Fixed (LendKey)
|5.05% (Federal Stafford Subsidized Loan)|
As the above table shows, it is often worth refinancing a student loan. If you’ve graduated from college and have built a good credit score, then you can achieve a much lower interest rate by refinancing—and potentially save thousands of dollars in the long run.
Things to take into consideration before refinancing:
|Potential for major savings over life of loan||With longer term, potential to pay more over life of loan|
|Reduced monthly payments||Applying for refinance can affect credit score|
|One single payment makes life easier||By refinancing federal loan, you waive rights to cancellation or forgiveness programs|
|More flexible repayment terms|
|Option of dropping previous co-signer from loan|
Eligibility can vary slightly between lenders, but the following are standard requirements for most refinance loans:
Lenders also look at the following:
A student loan refinance application is similar to other loan or refinance applications. It involves the following steps:
|Greater chance of approval||Co-signer takes on liability for debts|
|Reduced interest rate if co-signer has good credit||Damage to co-signer’s credit score in event of missed payments|
|Flexibility to release co-signer at pre-determined date in future||Potential damage to relationship with co-signer over financial matters|
A co-signer can be a:
If you have private student loans or private and federal loans, refinancing could be the best way to save money. But if you only have federal loans, you may want to consider debt consolidation or any of the federal government’s loan forgiveness or cancellation programs.
If you’re unable to meet the minimum payments, these are just some of the programs for being forgiven all or a portion of your loan amount:
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply. The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation. $5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees. This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary. Information advertised valid as of 1/27/2021. Variable interest rates may increase after consummation.
Earnest allows you to refinance incomplete bachelor's or associate's degrees if:
Commonbond: Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. If you choose to complete an application, we will conduct a hard credit pull, which may affect your credit score. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.15% effective Oct 1, 2020 and may increase after consummation.
† Credible Terms and Conditions:
Credible is so confident in the personal loan rates you’ll find on Credible, we’ll give you $200 if you find and close with a better rate elsewhere. See full terms and conditions.
Nelnet Terms and Conditions:
Lowest rates listed include enrollment in auto debit, and are available only to the most creditworthy applicants. Advertised variable rates reflect the starting range of rates and fluctuate (increase or decrease) over the life of the loan. Fixed interest rates range from 2.30% APR (with auto debit discount) to 5.96% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. The fixed interest rate will remain the same for the life of the loan. Variable interest rates range from 1.87% APR (with auto debit discount) to 5.33% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. Variable rates may increase after consummation. The variable interest rate is equal to the One-Month London Interbank Offered Rate (“One-Month LIBOR”) plus a margin. The One-Month LIBOR in effect for each monthly period (from the first day of the month through and including the last day of the same month) will be the highest One-Month LIBOR published in The Wall Street Journal “Money Rates” table on the twenty-fifth (25th) day (or if such day is not a business day, the next business day thereafter) of the month immediately preceding such calendar month. The Annual Percentage Rate (APR) for a variable interest rate loan will change monthly on the first day of each month if the One-Month LIBOR index changes. This may result in higher monthly payments. The current One-Month LIBOR index is 0.09% as of December 1, 2021. The lowest rate for each loan type requires automatically withdrawn (“auto debit”) payment. The lowest rate is available only to the most creditworthy applicants. Not all borrowers will receive the lowest rate. The interest rate and Annual Percentage Rate (APR) may be higher depending upon (1) the credit history of the borrower and, if applicable, the cosigner, (2) the repayment option and loan term selected, (3) the loan type selected, and (4) the highest level of education attained. If approved, applicants will be notified of the rate qualified for within the stated range.