PenFed Student Loan Refinance Review

Our Rating: B (Compare)

PenFed may be a good option for borrowers who wish to combine debt with a spouse or assume ownership of a parent loan. One of the largest credit unions nationwide, PenFed services its own loans. U.S. citizenship required.

Loan Limits $7,500 – $500,000
Fixed Rates 7.74% – 9.93%
Variable Rates NA
Terms 5, 8, 12 or 15 years
Min. Credit Score 676* (670 with co-signer)
Apply Link

*For loans up to $150,000. For loans exceeding $150,000, a credit score of less than 725 or less requires a qualifying co-signer.

Skip to: Rates & Fees | Eligibility Requirements | Repayment Options | Consumer Reviews & Complaints | FAQ

Loan Refinancing Options
Private student loans
Private parent loans (in either name†)
Federal student loans
Federal Parent PLUS loans (in either name)

Parents may refinance in their own names or transfer debt to a child.

PenFed Refinance Rates & Fees

Pentagon Federal Credit Union’s fixed rates are between 7.74% and 9.93%. PenFed appears to no longer offer variable rates.

In 2022, PenFed has raised its disclosed fixed rates. The lowest available fixed rate for new loans is up 167.8% (from 2.89% APR) since the end of last year while the highest fixed rate has increased 99.4% (from 4.98% APR).

Refinance Loan Rates
Term Fixed Rate
5 – 15 Years 7.74% – 9.93%

Additional information about PenFed refinance rates:

  • Checking your rate with PenFed will not affect your credit score. They will conduct a soft, not hard, credit inquiry (learn the difference).
  • PenFed does not offer a discount for setting up auto-pay.
  • PenFed offered variable rates until 7/1/2021; it is unclear if variable rates will become available again.

Student Loan Refinancing Calculator

Based on advertised rates, use the calculator below to determine what your new monthly payment and potential savings may be if you refinance with PenFed.

Additional Fees

Beyond interest rates, there are a number of fees a refinance lender may charge up-front or during the loan servicing period. Below is a list of these fees that PenFed does or does not charge.

Fee Type Amount Charged
Application Fee None
Loan Origination Fee None
Disbursement Fee Undisclosed
Prepayment Penalty None
Late Payment Fee $5 to $25 (20% of the finance charge)
Returned Payment Fee Undisclosed
Collection Fee Unspecified
  1. Application fee – fee to apply for rates & approval.
  2. Loan origination fee – fee to create the new loan.
  3. Disbursement fee – fee for distributing funds to lenders to pay off loans that have been refinanced.
  4. Prepayment penalty – fee for making extra payments to reduce a refinance loan balance or pay it off early.
  5. Late payment fee – fee for making a late payment.
  6. Returned payment fee – fee for failed payments due to insufficient funds, also known as a “bounced check.”
  7. Collection fee – fee for collection activity on a defaulted debt. PenFed discloses only that “[i]n the event of a default, the borrower may incur additional collection charges as permitted under applicable law.”

Current Promotions & Offers

PenFed does not typically offer promotions, discounts, or other such benefits. Branch locations sometimes have their own special offers available.

PenFed Refinance Eligibility Requirements

To qualify for refinancing with PenFed, all borrowers must meet the criteria below.

  • Citizenship Requirement: U.S. citizenship.
  • Income Requirement: $42,000 annual minimum for loans up to $150,000, $50,000 annual minimum for loans up to $300,000 -OR- $25,000 annual minimum with a qualifying co-signer.
  • Credit Score Requirement: minimum 670 with a co-signer who has a credit score of at least 720 for loans up to $150,000 or 725 for loans exceeding $150,000; for loans up to $150,000, the minimum credit score with no co-signer is 676; for loans exceeding $150,000, the minimum credit score with no-cosigner is 725.
  • Graduation Requirement: associates’s degree or higher.
  • Location Requirement: none.

Additional restrictions apply for specific individuals and loans.

  • Borrowers are required to be existing PenFed credit union members or join PenFed before loan authorization.
  • PenFed membership requires opening a PenFed savings account with a minimum of $5.

PenFed Student Loan Repayment Options

Lenders vary significantly on the benefits and options provided to borrowers during the loan servicing period. Additionally, benefits may only be available on a case-by-case basis. PenFed offers some relief options.

Deferment & Forbearance

PenFed does not advertise deferments or forbearance but does disclose a willingness to consider deferment under certain circumstances and on a case-by-case basis.

Condition Coverage
Returning to grad school Undisclosed
Disability rehabilitation Unspecified
Active military duty Undisclosed
Involuntary unemployment Unspecified
Economic hardship Unspecified
Natural disaster Undisclosed
Temporary hardship Unspecified

Additional Options

PenFed may offer other opportunities for relief or contract modification.

  • Co-signer release may be available after 12 consecutive qualifying payments.
  • Death / disability discharge is available in the unfortunate circumstance that a borrower passes away or suffers total permanent disability.

PenFed Reviews, Complaints & Lawsuits

Beyond our own findings, our team also collected the most genuinely insightful customer experiences available, including any instances of legal action against the company in which the details became public.

PenFed Online Reviews

Below are 3 samples of PenFed customer reviews we found on public forums, included here for their value as unedited, uncensored, and unsolicited user experiences. Note that these reviews are unverified, may include inaccuracies, and may provide outdated information (about rates, bonus offers, etc.).

“I recently refinanced a student loan with PenFed. I managed to get my 6% loan refinanced for 4%. Their portal seems not very advanced, but they offered me one of the lowest rates I could find compared to others. I also signed up for the 8 year plan. If I did the 5 year plan, I could have received a 3.75% rate; however, the monthly payment was too high to make it worth it. I have not had any issues with them these past few months.”MikeIzSuave on reddit, 7/14/2020

“Hey I actually just refinanced with PenFed (through [a marketplace lender]) and was quoted 1.6% variable. I also noticed the paperwork that said minimum of 2% which didn’t make sense since they quoted the 1.6%. I went ahead and followed through with the loan and it finally posted in the past few days and it’s already gone down to 1%. So I don’t really know what the minimum 2% refers to but it seems like mine has been below that without a problem so far. You may want to clarify with PenFed before signing though.”parkit on reddit, 5/16/2020

“Penfed has some issues on the front end.

I was declined a refi of $30K for a 5 year loan reason being my income to debt ratio was “bad”. I inquired and inquired and for some reason they had that I earned $1100 per month. How they arrived at that I don’t know as they had the copies of my paystubs at $3300 bi weekly……..

In the end it all worked out but yes, they aren’t on top of things.”retiredjg at, 6/18/2014

More (unfiltered) customer reviews of PenFed are available at (4.6 out of 5) and (4.0 out of 5).

PenFed Consumer Complaints

As consumer finance companies, student loan refinancing lenders fall under the jurisdiction of the Consumer Financial Protection Bureau (CFPB), a federal agency. As part of its mission, the CFPB allows consumers to log official complaints. These complaints are publicly available on the CFPB official website.

Since December 14, 2011, consumers have submitted 3,188 complaints about Pentagon Federal Credit Union (PenFed) to the CFPB for an average of one (1) complaint every 30 hours; that is 43 times higher than the average daily complaint rate among reviewed lenders. Among the 1,163 complaints with narratives, at least 4 (0.34%) specifically reference student loans or student loan refinancing.

In 2022, PenFed’s consumer complaint rate is 184.9% higher than it is in an average year as of this writing. In 2021, PenFed received 649 complaints, which is 121.7% higher than its average annual complaint rate.

Consumers file the equivalent of one (1) complaint for every $3.519 million of estimated annual corporate revenue or roughly two (2) complaints for every 17 employees.

The allegations made in these complaints are unverified, are not necessarily representative of all consumers’ experiences with PenFed, and may contain outdated information (about rates, bonus offers, etc.). Note that a lender with a large customer base is likely to have a higher number of complaints when compared with smaller lenders.

Line Graph: Consumer Complaints About PenFed, Public Complaints Filed with the Consumer Financial Protection Bureau, from December 2011 (5) and the years 2012 (69), 2013 (123), 2014 (103), 2015 (115), 2016 (161), 2017 (203), 2018 (277), 2019 (280), 2020 (508), and 2021 (649)

Below we’ve included three (3) of the most recent complaints (as of this writing) related to student loans and/or debt collection and in which the consumer consented to share their details.

Complaint 5787315

“>It has come to my attention that PenFed never resolved the banking errors which occurred back in XXXX. On XX/XX/XXXX Credits were posted to my account. I had initially thought these were the credits I transferred from my Checking Line of Credit to my checking account. These were in the amount of {$240.00}. So I then transferred these credits to my external account. On XX/XX/XXXX PenFed Deducted all of these credits. Resulting in a negative balance. Unaware of the negative balance PenFed then later closed my Overdraft Line of Credit and Credit Card citing that I had not responded to the emails received from PenFed regarding the overdraft share. Now mind you, I never received any calls from them regarding this issue. When I sent them an email confirming that these were placed in my account in banking error then, since I had stated I transferred from Line of Credit and didn’t believe this was a mistake. PenFed responded stating that the credits applied on XX/XX/XXXX were supposed to go to another account and that these were done so in error. Then they advised I transferred these credits out and I am being held responsible for the funds since they were withdrawn before the correction could be made to ” The account ”. This is obviously absurd, I do not control banking errors from this institution. I do not find this to be fair and equal treatment that I am being held responsible and forced to pay for a banking error, that I had no control over. How many other account ‘s has this credit union done this to? They then charged off the share and say I still owe it. I believe that I do not owe a balance that I was never responsible for in the first place. Penfed confirmed from XXXX XXXX that this was a banking error via email. Which I still have a copy of. This seems like this is harm to the customer especially when I was only transferring funds I had assumed were from the line of credit. I had no idea these were done in error as these did not have any description to them. I would like for this to be rectified so that I can bring my account ‘s back in good standing with Penfed. XX/XX/XXXX Funds Transfer Credit XXXX XXXX XX/XX/XXXX Funds Transfer Credit XXXX XXXX XXXX XX/XX/XXXX Funds Transfer Credit XXXX XXXX XXXX XX/XX/XXXX Ach Debit By Member XXXX XXXX Bank Transfer XXXX XXXX XX/XX/XXXX XXXX XXXX XXXX XX/XX/XXXX Ending Balance {$8.00} This is from the XXXX statement of XXXX.”

Complaint 5782703

“I had a joint account with pentagon credit union with my wife in 2018 we divorced, sold our home, and paid all of our credit cards off I wanted to close the account out but pentagon assured me i could just be removed from the account. we talked and i asked for an email with evidence of it to make sure. i was sent an email the day of my removal with a balance showing i did talk to them, i also was removed from most parts of it but they missed one thing. later on i noticed it on my credit report, i called many times, they said they couldnt find any link of it so i submitted for it to be removed from XXXX twice but they Pentagon then would say i am part of it. my ex died recently and then i get a call from pentagon saying im on the hook for it, I have called many times since and keep running into issues. the second before the last time i called, a lady finally found me linked to the account but her supervisor told me tough luck even though i explained the chain of events. the last time i called they wouldnt talk to me till i submitted my id cause they couldnt verify my date of birth when i called. this is stressful and i feel powerless to do anything outside of spending a ton of money to prove this isnt fair so my credit score isnt killed completely cause they are dinging me for late payments since her death.”

Complaint 5780943
New Jersey

“Penfed closed my account and kept my funds without informing me. I called and wasted many hours on the phone with them but they could not provide any information on when they closed the account and what they did with the money. When they couldnt find any information, they simple lied to me saying that they ” should have ” sent it to XXXX XXXX XXXX. I have been checking with the XXXX XXXX XXXX XXXX site for these funds and there is nothing there. They also said that they ” should have ” sent me a letter regarding this when they had no proof or documentation or even the date for when this imaginary letter was sent.”

For a complete list of complaints made against PenFed in the CFPB’s Consumer Complaint Database, click here.

PenFed Lawsuits

Note that while this information is updated regularly, ongoing legal action is subject to change.

Nyjah Ross et al., v. Pentagon Federal Credit Union, et al., Case No. 1:20-cv-00281-RDA-JFA

In March 2020, Nyjah Ross and Thomas Castelli filed a class action complaint against PenFed alleging violation of Regulation E of the Electronic Fund Transfer Act (EFTA).[1]

Specifically, plaintiffs claim they were charged multiple non-sufficient funds (NSF) fees for the same electronic transaction and were also charged NSF fees when their accounts did have sufficient funds to cover the transaction. This is the second civil action against PenFed for apparent violation of its own account agreement regarding NSF charges to borrowers.

The case has been assigned to US District Court for the Eastern District of Virginia, Judge Rossie D. Alston presiding, and is presumably ongoing.[2]

Tiffany Neal v. Pentagon Federal Credit Union, Case No. ELH-18-451

Plaintiff Tiffany Neal, a disabled veteran, filed a civil action suit against PenFed in August 2019, alleging the credit union violated EFTA as well as multiple sections of the State of Maryland’s Breach of Contract law.

Specifically, Neal alleges PenFed “unlawfully withdrew disability benefits from her PenFed account to offset Neal’s overdue loan payments.”[3]

This case has been assigned to United States District Court, District of Maryland’s 4th circuit court, Judge Ellen L. Hollander presiding, and is presumably ongoing.[4]

Frequently Asked Questions

These are the most common questions consumers have about student loan refinancing with PenFed.

  • Is PenFed good for refinancing student loans?
    PenFed may be a good option for borrowers who wish to assume ownership of a parent loan or combine student debt with a spouse; this is especially true of financially established and secure borrowers who are or want to become members of Pentagon Federal Credit Union.
  • Does PenFed have a minimum credit score requirement to refinance student loans?
    Yes, PenFed has a minimum credit score of 670 with a co-signer. To refinance up to $150,000 in student loans, a co-signer must have a minimum credit score of 720; to qualify without a co-signer, the borrower must have a credit score of 676 or higher. To refinance more than $150,000, a co-signer must have a minimum credit score of 725; to qualify without a co-signer, the borrower must also have a credit score of 725 or higher.
  • Are PenFed loans federal?
    No, PenFed loans are not federal. PenFed has no affiliation with the federal government or the U.S. Department of Education.
  • Does PenFed charge a prepayment penalty?
    No, there are no penalties for early payments or repaying a loan in full before its term is over.
  • Does checking your rates with PenFed hurt your credit score?
    PenFed performs a soft credit check for their prequalification process, which will not hurt your credit score. If you proceed with an application, however, PenFed will perform a hard credit check that may affect your credit score.
  • Is PenFed a bank?
    No, PenFed is not a bank; it was among the first credit unions founded under the Federal Credit Union Act as part of President Roosevelt’s New Deal in 1935.
  • Can I refinance a PenFed loan?
    Yes, you can refinance a PenFed student loan or a student loan from another private lender. There is no limit to the number of times a borrower may refinance with PenFed. Note, however, that every new line of credit requires a hard credit check that may affect your FICO score.
  • Can I refinance just some of my loans with PenFed?
    Yes, you can refinance some, all, or just one of your qualifying student loans with PenFed. You may choose to refinance your private loans only or refinance private and federal loans together.
  • Can I refinance loans that have already been refinanced?
    Yes, you can refinance loans as many times as you want with PenFed. Note that each time you refinance, you will have to submit a new application; every application requires a hard credit check that may affect your credit score.
  • Can my spouse and I refinance our loans together with PenFed?
    Yes, PenFed evaluates spouses together and allows them to combine debt. Spouse co-signers are exempt from co-signer release; 67% of co-signed PenFed student loan refinances are spousal loans.
  • How long does it take to refinance with PenFed?
    PenFed does not specify a full timeline but estimates 3-14 days for disbursement, with the first payment due 30 days after that.
  • Who services PenFed refinance loans?
    PenFed services all their own student refinance loans.
  • Does PenFed offer a grace period?
    No, PenFed does not offer a grace period.
  • Can I get any special rates or discounts with PenFed?
    PenFed does not advertise any discounts or rate reductions. Branch locations may offer their own promotions.
  • What happens if I file for bankruptcy?
    PenFed does not specify what action the lender will take but cautions that borrowers who file for bankruptcy “may still be required to pay back [their] loan.”[5]
  • Does PenFed partner with any major student refinance lender marketplaces?
    PenFed partners with Credible as part of its multilender marketplace. INvestEd and Purefy also advertise PenFed as a featured lender.

Compare Student Loan Refinance Reviews

Lender Rating
Brazos A
CommonBond A
Credible A
Advantage A-
Laurel Road A-
Mpower Financing A-
Splash Financial A-
Purefy B+
UW Credit Union B+
LendKey B+
College Ave B
PenFed B
SoFi B
Earnest B-
EDvestinU B-
INvestEd B-
Sparrow B-
Yrefy B-
Citizens Bank C+
Lend-Grow C+
SELF Refi C+
SuperMoney C+
First Tech Federal C
Navy Federal C-
First Republic Bank D+
iHelp D+
Discover D
Nelnet Bank D
PNC Bank D-
NaviRefi F


  1. Truth In Advertising, Case 1:20-cv-00281-RDA-JFA
  2. Justia Docket & Filings, Ross et al v. Pentagon Federal Credit Union et al
  3. Casetext, Neal v. Pentagon Fed. Credit Union, Civil Action No. ELH-18-451
  4. Govinfo, Content Details: 18-451 – Neal v. Pentagon Federal Credit Union
  5. Pentagon Federal Credit Union, Refinance Student Loans
  6. PenFed, Student Loan Refinancing Overview
  7. PenFed, Eligibility Criteria
  8. Jacksonville University, The More You Know: Great Advice for Grad and Pro 2020
  9. Consumer Financial Protection Bureau, Consumer Complaint Database
  10. Dun & Bradstreet, Business Directory: Pentagon Federal Credit Union
  11. Better Business Bureau, Search Businesses and Charities