Student Loan Refinancing

Report Summary. Our investigation uncovered when you should (and shouldn’t) refinance, current rates from all available lenders and which lenders to stay away from for reasons such as past lawsuits, excessive consumer complaints and more.

Recommended Student Loan Refinancing Companies
Lender Fixed APR Variable APR Website
Lender Advantage Fixed APR 3.74% – 7.78% Variable APR None Link
Brazos 2.95% – 4.54% 1.89% – 5.06% Link
CommonBond 2.59% – 6.99% 2.50% – 7.10% Link
ELFI 2.58% – 5.99% 2.39% – 6.01% Link
Lender Laurel Road Fixed APR 2.50% – 5.33% Variable APR 1.89% – 6.15% Link

Note: lowest APRS always include any available autopay discounts.

Table of Contents: Should You Refinance | Refinancing Terms & Basics | Lenders & Rates | FAQ | Alternatives to Refinancing

Should You Refinance?

In simplified terms, refinancing means taking out a new loan to pay off an old loan(s). This may be cost effective under certain circumstances; 33.3% of student borrowers consolidate or refinance their student loans.

Do you want to reduce your monthly payments?

Most student borrowers who refinance want to lower their minimum monthly payment. Refinancing allows borrowers to alter the terms of their debt. To reduce monthly payments, borrowers need a lower annual percentage rate (APR) or a longer loan term.

Do you have a high debt balance outstanding?

Refinancing may be cost effective for borrowers with a high student loan debt balance. This is why refinance lenders require a minimum debt balance. The most common minimum balance is $5,000, but they can run as high as $60,000.

Do you want to release a co-signer or combine debt with a spouse?

Refinancing is an opportunity to release a co-signer, sign a new one, or transfer ownership of a debt balance from one person to another, such as from parent to child. Further, private refinancers often allow spouses to refinance jointly, combining their respective debts.

Do you want to simplify monthly payments?

Refinancing is the only way to combine federal and private loans. Remembering one monthly payment instead of several makes it less likely you’ll miss a payment. Missed payments hurt your credit history and your ability to qualify for the lowest interest rate available.

Can you lower your interest rate?

The best time to refinance is when you have a steady income and a good credit rating. The better your financial standing, the more likely it is you’ll be able to refinance at the lowest APR. The median average APRs declined from Dec. 2020 to Jan. 2021 by a total of 0.437 percentage points.

Can you reduce the total amount you’ll ultimately repay?

Paying off a loan quicker reduces the end cost. For example, a $10,000 refinance loan with a 5-year term at 5.00% APR ultimately costs $543 less than the same loan with a 10-year term at 3.50% APR.

Bar Graph: APRs and Comparative Total Interest Payments for a $10,000 Student Refinance Loan

Student Loan Refinancing Calculator

Refinancing Terms & Basics

For refinancing to be cost effective, it’s important to understand how the process works and what certain terms mean.

  • Age of Majority – Lenders require that borrowers be of the age of majority in their own state. In most states, that’s 18 years. In Alabama and Nebraska, the age of majority is 19. In Puerto Rico, borrowers must be at least 21.
  • APR – A loan’s annual percentage rate or APR is the loan’s interest rate plus additional costs, expenses, and fees. In cases of long-term, regular payments, the APR reflects the total cost of borrowing. Lowest APRs listed include all possible discounts.
  • Consolidation – Consolidation means to combine existing loans. A Federal Direct Consolidation Loan restructures multiple loans into one single loan at a fixed APR, which is based on the average rate of all the consolidated loans being consolidated (not to exceed 8.25%). Only federal student loans can be consolidated this way.
  • Credit Inquiry/Pull – In order to prequalify, most lenders require a soft credit pull. This has no effect on your credit score, and it tells lenders if you meet the minimum requirements to apply. A hard credit pull has the potential to impact a credit score. With your consent, lenders will use a hard credit pull to determine your eligibility, APR, and the maximum amount you can borrow.
  • Deferment – A temporary reduction in loan payments or a postponement of repayment altogether, deferment is not an industry standard. Some lenders allow borrowers to apply for deferment under certain circumstances. Interest may or may not continue to accrue depending on the lender’s policies.
  • FICO – Fair Isaac Corporation or FICO is a data analytics company that assigns each consumer credit history a score. Banks and lenders use this credit score to assess credit risk (i.e. the likelihood you’ll repay the money they lend you).
  • Fixed Rate – When loans are refinanced at a fixed rate, the APR is locked in for the life of the loan. All refinance lenders offer a fixed rate option. Most financial experts recommend using fixed rates for budgeting purposes.
  • Forbearance – Similar to deferment, a loan in forbearance always continues to acquire interest while payments are postponed. Few lenders offer any type of forbearance.
  • LIBOR – The acronym for the London Interbank Offered Rate, a benchmark refinance lenders use to determine market variable rates for education loans. Most refinance lenders use either the 1-month LIBOR (currently 0.111%) or the 3-month LIBOR (currently 0.181%).
  • Prequalify – In order to avoid a hard credit pull that may damage your FICO score, lenders can prequalify or preapprove you for refinancing. Preapproval helps you decide if you want to move forward with the qualification process and the hard credit inquiry.
  • SOFR – The acronym for the Secured Overnight Financing Rate, another market rate benchmark. Some refinancers use the 90-day SOFR (currently 0.021%) to determine variable rates.
  • Variable Rate – The variable rates listed are starting rates. Once the loan has been initiated at the starting rate, that rate then varies based on market rates. Not all lenders offer a variable rate option for refinancing; those that don’t may offer similar alternatives.

Lenders & Rates

Below is a list of the lenders we reviewed and collected the information of. Read further to learn about our overall findings or click on a lender’s name to learn more about them in particular.

Refinance Lenders Sorted by Lowest Fixed Interest Rate Available
Lender Fixed APR Variable APR
First Republic Bank 2.25% – 6.25% None
Laurel Road 2.50% – 6.25% 1.89% – 6.15%
ELFI 2.58% – 5.99% 2.39% – 6.01%
CommonBond 2.59% – 6.99% 2.50% – 7.10%
First Tech Federal 2.65% – Undisclosed None
PenFed Credit Union 2.89% – 4.78% 2.15% – 4.42%
Citizens Bank 2.89% – 9.60% 2.19% – 9.35%
Brazos 2.95% – 4.54% 1.89% – 5.06%
NaviRefi 2.98% – 6.04% 1.81% – 4.97%
Earnest 2.98% – 6.04% 1.99% – 5.89%
Navy Federal Credit Union 2.99% – 12.03% 1.61% – 10.21%
SoFi 2.99% – 6.99% 2.25% – 6.54%
MEFA 3.05% – 5.55% 3.05% – 5.55%
UW Credit Union 3.14% – 7.15% 1.73% – 5.03%
RISLA 3.19% – 5.84% None
College Ave 3.34% – 5.94% 3.24% – 5.79%
PNC Bank 3.44% – 6.74% 2.22% – 5.52%
Discover Bank 3.49% – 7.24% 1.87% – 6.12%
U-fi 3.59% – 12.37% 1.20% – 11.72%
Advantage 3.74% – 7.78% None
SELF Refi 3.80% – 5.55% 2.50% – 4.10%
EDvestinU 3.91% – 6.53% 1.83% – 4.45%
iHelp (ZuntaFi) 3.92% – 5.60% 2.68% – 3.64%
BECU 4.49% – 9.24% None
Median Average 5.09% 4.10%

Our research team gathered data from public records and corporate filings to chart how the process of student loan refinancing varies by the refinance lender. Here’s what we found:

  • Few if any lenders will refinance a loan with a debt balance below $5,000.
  • Loan forgiveness in cases of borrower death is standard but not guaranteed.
  • Refinance loans that are explicitly designated as education loans may be eligible for tax benefits.
  • Filing for bankruptcy does not necessarily discharge refinance loans.
  • 80% of lenders offer a minimum 5-year term on refinanced loans.
  • The longest refinance loan term available is 25 years.
  • Direct lenders are banks and other such financial institutions that supply refinance loans.
  • Marketplace lenders are non-bank financial institutions that pair borrowers with other lenders.
  • Multi-lender marketplaces partner with direct lenders and marketplace lenders to offer borrowers a platform to submit applications for prequalification at a number of lenders at once.
  • State-sponsored lenders are public institutions; state residency is not required to apply, but residents may be eligible for additional discounts.

Bar Graph: Median Fixed Rates Among Lenders

With that said, below we provide information about each lender we investigated.

Advantage

Loan Limits: $7,500 – $200,000+*
Fixed Rates: 3.74% – 7.78%
Variable Rates: NA
Terms: 10, 15 or 20 years
Min. Credit Score: 670
Misc. Restrictions: NA

*Borrowers need special approval to refinance more than $200,000 in student loans.

Founded in 1966, Advantage Education Loans services undergraduate loans, graduate loans, and parent PLUS loans. As a state-run, nonprofit direct lender, its refinance loans are serviced by the Kentucky Higher Education Student Loan Corporation (KHESLC).

Program Information:

  • Instead of a variable rate, Advantage offers a graduated repayment option, where monthly payments start at a decreased level and increase by 10% every two years.
  • The autopay discount is a 0.25% interest rate deduction.
  • Borrowers may apply for co-signer release after 36 consecutive qualifying payments.
  • The minimum monthly payment for refinanced loans is $50.
  • Borrowers may apply for up to 24 months of financial hardship deferment over the term of their loan.
  • Borrowers may refinance their own education loans and any parent loan for which they are the benefitting student.
  • This lender offers defaulted loan rehabilitation services.
  • There are no application, origination, or disbursement fees.
  • No prepayment, late payment, or returned payment penalty.
  • No fees for insufficient funds or default.
  • Advantage never sells its loans to other financial institutions or servicers.
  • Advantage is a Credible lender.
  • Degree requirements vary by state.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • A minimum credit score of 670.
  • A minimum income of $18,000 -OR- an approved co-signer

For more information on Advantage, read our full review.

BECU

Loan Limits: $10,000 – $125,000
Fixed Rates: 4.49% – 9.24%
Variable Rates: NA
Terms: 5, 10 or 15 years
Min. Credit Score: Undisclosed
Misc. Restrictions: Borrowers must be(come) BECU members.

Founded in 1935 as Boeing Employees’ Credit Union, BECU is large for a credit union in terms of employees as well as revenue. LendKey is BECU’s loan servicer.

Program Information:

  • Borrowers with undergraduate degrees may refinance up to $100,000.
  • Graduate or parent borrowers may refinance up to $125,000.
  • Borrowers may apply for co-signer release after 24 consecutive, qualifying payments.
  • 0.25% interest rate reduction for auto-pay.
  • $50 minimum monthly payment.
  • No prepayment penalty.
  • No application or origination fees.
  • BECU membership is restricted to:
    • Employees, volunteers, or retired employees (and their family members) of BECU or Boeing Company.
    • Residents of the State of Washington.
    • Residents of Benton, Clackamas, Columbia, Lane, Linn, Marion, Multnomah, Polk, Washington and Yamhill Counties in Oregon.
    • Residents of Benewah, Bonner, Boundary, Clearwater, Idaho, Kootenai, Latah, Lewis, Nez Perce and Shoshone Counties in Idaho.

Eligibility Requirements.:

  • U.S. citizenship or permanent residency.
  • BECU membership.
  • Bachelor’s degree or higher from an eligible institution.

For more information on BECU, read our full review.

Brazos

Loan Limits: $10,000 – $400,000
Fixed Rates: 2.95% – 4.54%
Variable Rates: 1.89% – 5.06% (9.90% Cap)
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: 720 (690 with co-signer)
Misc. Restrictions: For Texas residents only

The Brazos Higher Education Service Corporation, Inc. (Brazos Higher Education) is a nonprofit direct lender. Founded in 1980, Brazos has serviced an estimated 2 million student borrowers to date.

Program Information:

  • The maximum loan amount is $150,000 for borrowers with a bachelor degree and $400,000 for borrowers with a graduate, medical, law or other professional degrees.
  • Brazos uses the 1-month LIBOR to determine variable interest rates.
  • Variable rates will never exceed 9.90%.
  • Brazos determines credit scores according to the TransUnion FICO Score 8.
  • 0.25% interest rate discount available for borrowers who turn on auto-pay.
  • $200 reward for each referral that results in a new origination.
  • This lender’s refinancing services are available to residents of the State of Texas.
  • No application or origination fees.
  • No prepayment penalty.
  • Brazos does not sell its loans to other financial institutions or servicers.
  • Brazos is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • Texas residency.
  • A bachelor’s degree or higher.
  • An income of $60,000 and a 720 credit score* –OR- An income of $30,000, a credit score of 670, and a qualified co-signer.

For more information on Brazos, read our full review.

Citizens Bank

Loan Limits: $10,000 – $500,000
Fixed Rates: 2.89% – 9.60%
Variable Rates: 2.19% – 9.35% (21.00% Cap*)
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: Undisclosed
Misc. Restrictions: NA

*The variable rate cap is the greater of 21.00% or Prime Rate plus 9.00%.

Citizens Bank is part of Citizens Financial Group, a publicly-traded, $180 billion company. Student refinance loans are serviced by Firstmark Services.

Program Information

  • The maximum loan for most borrowers is $300,000, but advanced degree holders (master’s or above) may borrow up to $500,000.
  • The Education Refinance Loan for Parents fixed rate high is 6.19% while the starting variable rate high is 5.94%
  • 1-month LIBOR determines variable interest rates.
  • Borrowers may apply for co-signer release after 36 consecutive qualifying payments.
  • Bank members who auto-pay are eligible for a 0.50% interest rate reduction.
  • Citizens offers up to 12 months of medical and 12 months of economic hardship forbearance.
  • Borrowers don’t need a degree to refinance, but they cannot be current students.
  • Parent PLUS loans may be refinanced, but the debt may not be transferred to a child.
  • There are no application, origination, or disbursement fees.
  • No early payment penalty.
  • Citizens is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship or permanent residency -OR- a co-signer who is a citizen or permanent resident.
  • A bachelor’s degree or higher -OR- At least 12 qualifying payments with an associate’s degree or no degree.

For more information on Citizens Bank, read our full review.

College Ave

Loan Limits: $5,000 – $300,000
Fixed Rates: 3.34% – 5.94%
Variable Rates: 3.24% – 5.79% (25.00% Cap)
Terms: 5 to 20 years
Min. Credit Score: 650
Misc. Restrictions: Unavailable in Maine

College Ave Student Loans or College Ave Refi is a marketplace lender that offers refinancing services backed by Firstrust Bank.

Program Information:

  • The refinance limit is $300,000 for graduates with degrees in medicine, pharmacy, dentistry, or veterinary medicine.
  • Those with undergraduate or other graduate degrees may refinance up to $150,000.
  • 25.00% variable rate cap.
  • 0.25% interest rate reduction for auto-pay.
  • This lender offers 16 loan term options.
  • The minimum monthly payment for refinanced loans is $50.
  • No application or origination fees.
  • No prepayment penalty.
  • College Ave is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship or permanent residency
  • A minimum credit score over 650.
  • A minimum income of $38,000.
  • An associate’s degree or higher.

For more information on College Ave, read our full review.

Bar Graph: Median Variable Rates Among Lenders

CommonBond

Loan Limits: $5,000 – $500,000
Fixed Rates: 2.59% – 6.99%
Variable Rates: 2.50% – 7.10% (9.99% Cap)
Hybrid Rates: 2.87% – 6.81%
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: 660
Misc. Restrictions: Unavailable in Nevada and Mississippi

CommonBond, Inc. is a for-profit marketplace lender founded in 2012 by three business students dedicated to corporate accountability and transparency. The company’s refinance loans are serviced by CommonBond Lending LLC.

Program Information:

  • With a hybrid rate, the first half of a loan term is serviced at a variable rate, and the latter half uses a fixed rate.
  • Borrowers may apply for co-signer release after 36 consecutive qualifying payments.
  • Up to 24 months of forbearance over the term of their loan may be available to some borrowers.
  • 9.99% variable rate cap.
  • 1-month LIBOR determines the variable rate.
  • 0.25% interest reduction with auto-pay enrollment.
  • $200 for each referral that results in an origination.
  • No application or origination fees.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.*
  • An associate’s degree or higher from a qualified U.S. school.
  • Proof of employment.
  • A credit score of 660 or above.

*CommonBond accepts certain types of visas under stringent circumstances, including a qualified co-signer.

For more information on CommonBond, read our full review.

Discover

Loan Limits: $5,000 – $150,000
Fixed Rates: 3.49% – 7.24%
Variable Rates: 1.87% – 6.12% (18.00% Cap)
Terms: 10, 15 or 20 years
Min. Credit Score: Undisclosed
Misc. Restrictions: NA

Discover Bank is a subsidiary of Discover Financial Services and the issuer of the Discover Card, which was introduced by Sears in 1985.

Program Information:

  • 5% of consumer complaints against private student loan servicers submitted to the U.S. Consumer Financial Protection Bureau (CFPB) are in regard to Discover Bank.
  • Discover uses the 3-month LIBOR to determine variable interest rates.
  • The variable interest rate will never exceed 18.00%.
  • 0.25% interest rate reduction for auto pay.
  • $100 for every qualified referral.
  • No chance to prequalify.
  • No application, origination fees.
  • No prepayment or late payment penalty.
  • No graduation requirement.
  • Refinance loans that enter default are due immediately in their entirety.
  • Discover may sell or transfer a refinance loan to another institution at any time.
  • Borrowers may apply for academic deferment.
  • Deferred payments may also be available to borrowers:
    • Active in the military (up to 36 months deferment).
    • Working for an eligible public service organization (up to 36 months deferment).
    • In a health profession residency program (up to 60 months deferment).

Eligibility Requirements:

  • U.S. citizenship or permanent residency -OR- a creditworthy, qualified co-signer.
  • Proof of employment or income.
  • An undisclosed minimum credit score.

For more information or to apply, click here.

Earnest

Loan Limits: $5,000 – $500,000
Fixed Rates: 2.98% – 6.04%
Variable Rates: 1.99% – 5.89%* (11.95% Cap)
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: 650
Misc. Restrictions: Unavailable in Delaware, Kentucky, and Nevada

*Variable rates are unavailable in Alaska, Illinois, Minnesota, New Hampshire, Ohio, Tennessee, and Texas.

Earnest Operations LLC is a data-driven direct lender and a subsidiary of Navient Corporation. Earnest’s algorithms are designed to develop merit-based interest rates.

Program Information:

  • 1-month LIBOR determines variable rate.
  • Refinancing services are available in 48 states (excluding Kentucky and Nevada) and Washington, D.C.
  • Variable rates are unavailable in Arkansas, Illinois, Minnesota, New Hampshire, Ohio, Tennessee, and Texas.
  • Borrowers may apply to skip one payment every 12 months.
  • $200 bonus for every referral who refinances with Earnest.
  • 9.95% variable rate cap; 8.95% cap for loan terms of 10 years or less.
  • 0.25% discount for auto pay.
  • Borrowers may apply for deferment; Earnest does not specify a period limit, but interest always continues to accrue.
  • No fees for origination, prepayment, early repayment, or returned payments.
  • Earnest does not sell its loans to other financial institutions or servicers.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • No bankruptcies.
  • Proof of consistent income.
  • A minimum credit score of 650.
  • An associate’s degree or higher -OR- A completed degree by the end of the current semester -OR- Student loans in repayment while enrolled less than half-time.

Earnest Operations LLC and its sister company NaviRefi have not been implicated in ongoing lawsuits against their parent company, Navient Corporation, alleging violations of the Fair Credit Reporting Act and the Fair Debt Collection Practices Act.[1][2]

For more information on Earnest, read our full review.

EDvestinU

Loan Limits: $7,500 – $200,000
Fixed Rates: 3.91% – 6.53%
Variable Rates: 1.83% – 4.45% (21.00% Cap)
Terms: 5, 10, 15 or 20 years
Min. Credit Score: 700 (without co-signer)
Misc. Restrictions: NA

EDvestinU® is a nonprofit direct lender and part of the New Hampshire Higher Education Assistance Foundation (NHHEAF) Network under New Hampshire Higher Education Loan Corporation (NHHELCO). Refinance loans are serviced by Granite State Management & Resources (GSM&R).

Program Information:

  • Borrowers may apply for 3-month deferment periods of up to 12 months total over the term of their loan.
  • Residents of the state of New Hampshire may be eligible for reduced finance charges.
  • Borrowers may apply for co-signer release after making 36 consecutive qualifying payments.
  • 21.00% variable rate cap.
  • 1-month LIBOR determines variable rate.
  • 0.25% interest rate reduction for enrollment in auto pay.
  • No origination fees.
  • Late payment fee is 5% of monthly payment amount.
  • No degree requirement.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • No past bankruptcies or defaulted loans.
  • A maximum 43% debt-to-income ratio.
  • A minimum gross income of $30,000 for loans up to $100,000 and a minimum gross income of $50,000 for loans balances above $100,000 -OR- an eligible co-signer.

For more information or to apply, click here.

ELFI

Loan Limits: $15,000+
Fixed Rates: 2.58% – 5.99%
Variable Rates: 2.39% – 6.01% (9.95% Cap)
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: 680
Misc. Restrictions: NA

Education Loan Finance or ELFI is a division of SouthEast Bank, a locally-owned financial servicer in Farragut, Tennessee.

Program Information:

  • Borrowers may apply for up to 12 months of forbearance during their loan term.
  • This lender’s services are available in all U.S. states and Puerto Rico.
  • The variable rate is capped at 9.95%.
  • 3-month LIBOR determines variable interest rate.
  • Services private parent student loans.
  • No penalty for prepayment.
  • No application, origination, or loan guarantee fee.
  • The fee for late charges is the lesser of $50.00 or 5.00% of the overdue amount.
  • $30.00 is the fee for returned checks and insufficient funds.
  • ELFI is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • A bachelor’s degree or higher.
  • A minimum income of $35,000.
  • A minimum 36-month credit history with a score of 680.

For more information on ELFI, read our full review.

First Republic Bank

Loan Limits: $60,000 – $350,000
Fixed Rates: 2.25% – 6.25%
Variable Rates: NA
Terms: 7, 10 or 15 years
Min. Credit Score: 680
Misc. Restrictions: No variable APR; available only in California, Connecticut, Massachusetts, New York, and parts of Florida, Oregon, and Wyoming.

First Republic Bank is unique in that it offers student loan refinancing and consolidation loans as personal lines of credit. These lines of credit do not qualify for educational tax benefits.

Program Information:

  • This lender offers an interest-only period of 2 years.
  • First Republic has the highest minimum debt balance among refinancers listed here.
  • First Republic also has the lowest median fixed APR.
  • The minimum draw is $1,000.
  • $200 to $300 to qualified borrowers who use their referral bonus plan.
  • This lender offers a prepayment rebate of up to 2% of the original loan balance for those who pay off their loan in full within 48 months.
  • Borrowers much have or open a First Republic ATM Rebate Checking Account; closing the account increases interest rates 5.00%.
  • No fees for origination, maintenance, or prepayment.
  • To obtain the lowest fees, borrowers must open a First Republic ATM Rebate Checking account.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • a debt-to-income ratio below 40%.

For more information or to apply, click here.

First Tech Federal

Loan Limits: $5,000 – $500,000
Fixed Rates: 2.65% – Undisclosed
Variable Rates: NA
Balloon Rates: 6.35% – Undisclosed
Interest-Only Rates: 6.35% – Undisclosed
Terms: 5, 7, 10 or 15 years
Min. Credit Score: Undisclosed
Misc. Restrictions: Borrowers must be(come) First Tech credit union members.

Founded in 1952, First Technology Federal Credit Union does not offer variable rates. First Tech does, however, offer refinancing options most lenders do not, including loan options with lengthy interest-only periods.

Program Information:

  • The minimum loan amount for a balloon loan is $20,000.
  • $10,000 minimum loan amount for a 1- to 5-year interest-only loan, and $20,000 minimum for a 6- to 10-year interest-only loan.
  • $50 minimum monthly payment.
  • 0.25% interest rate reduction for auto pay.
  • Undisclosed late payment fee.
  • $3.00 payment processing fee.
  • $5.00 monthly credit union membership fee.
  • $28 returned payment fee.
  • $15 fee for payments made more than 10 days late.
  • No application or origination fees.
  • No prepayment penalty.
  • With interest-only refinancing, borrowers may be eligible for 1- to 10-year periods of interest-only payments.
  • Balloon refinancing holds off either 40% or 50% of the loan to be repaid in one single final payment.
  • Repayment minimums grow over time with interest-only and balloon refinancing.
  • Borrowers may apply for an unspecified forbearance period due to financial or medical hardship.
  • First Tech discloses neither credit nor graduation requirements.
  • First Tech’s credit union membership is restricted to:
    • Employees of corporations headquartered in the State of Oregon.
    • Employees of certain corporations partnering with First Tech.
    • Residents of Lane County, Oregon.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • First Tech credit union membership.
  • Additional undisclosed requirements.

For more information on First Tech, read our full review.

iHelp

Loan Limits: $10,000 – $250,000
Fixed Rates: 3.92% – 5.60%
Variable Rates: 2.68% – 3.64%
Terms: 5, 8, 12 or 20 years
Min. Credit Score: Undisclosed
Misc. Restrictions: NA

iHelp, formerly known as Reunion, is a subsidiary of the Student Loan Finance Corporation. iHelp is rare in that it offers an income-based repayment plan via ZuntaFi.

Program Information:

  • This lender offers standard, graduated, and income sensitive repayment plans.
  • iHelp’s “fixed hybrid” APR starts at the fixed rate then undergoes an adjustment every fifth year.
  • iHelp uses the 90-day SOFR to determine variable APR.
  • Borrowers may apply for co-signer release after 24 months of consecutive qualified payments.
  • Borrowers enrolled at least half-time in an eligible school may apply for academic deferment.
  • Borrowers may also apply for forbearance due to financial hardship.
  • No origination or prepayment fees.
  • Late payment penalty is the lesser of $10.00 or 5% of the overdue amount.
  • Up to $15 returned check penalty.
  • Upon default, depending on the borrower’s state of residence, up to 25% of the principal balance may be assessed for collection fees.
  • No graduation requirement.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • A minimum 2-year credit history.
  • A minimum $24,000 income for the past two years.
  • A debt-to-income ratio of 45% or less.
  • -OR – A co-signer who meets all the above qualifications.

For more information or to apply, click here.

Laurel Road

Loan Limits: $5,000+
Fixed Rates: 2.50% – 5.33%
Variable Rates: 1.89% – 6.15% (10.00% Cap)
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: 660
Misc. Restrictions: NA

Laurel Road specializes in student loan refinancing and financial services for healthcare professionals. Keycorp acquired Laurel Road in 2019, and KeyBank National Association now backs all Laurel Road loans.

Program Information:

  • This lender offers special refinancing rates and benefits for qualifying health professionals.
  • Borrowers with associate’s degrees in certain fields may be eligible for up to $50,000 of their student loan debt balance.
  • Borrowers may apply for a 3-month forbearance due to financial hardship related to COVID-19.
  • Borrowers may apply for a 2-month forbearance due to natural disaster.
  • Under certain conditions, borrowers may also be eligible for up to 12 months of forbearance due to economic hardship.
  • Refinancing services are available in 50 U.S. states, Washington, D.C., and Puerto Rico.
  • 10.00% variable rate cap.
  • 1-month LIBOR as published by The Wall Street Journal determines variable rate.
  • 0.25% interest reduction for auto pay.
  • Discounts are available to members of health professional organizations, such as the American Dental Association (ADA) and the American Medical Association (AMA).
  • This lender offers total or partial loan forgiveness in the event of severe permanent disability in addition to the standard discharge in the event of death.
  • No application fee or prepayment penalty.
  • For payments more than 15 days late, the late payment penalty is the lesser of $28.00 or 5% of the monthly payment amount.
  • $20.00 charge for insufficient funds.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • An associate’s degree or higher.
  • A credit score of 660 or higher.

For more information on Laurel Road, read our full review.

MEFA

Loan Limits: $10,000+
Fixed Rates: 3.05% – 5.55%
Variable Rates: 3.05% – 5.55% (20.00% Cap)
Terms: 7, 10 or 15 years
Min. Credit Score: 670
Misc. Restrictions: Only refinances loans used to attend not-for-profit schools.

Massachusetts Educational Financing Authority or MEFA has been a nonprofit creditor since 1982. This lender deals solely in education loans and claims its refinance loans reduce student interest rates by an average 28%.

Program Information:

  • Loans are eligible for refinancing only after they have been repaid on time for the previous 12 consecutive months.
  • 20.00% variable rate cap.
  • 1-month LIBOR as published by The Wall Street Journal determines variable rate.
  • In order to qualify for refinancing, loans must have been used to attend a not-for-profit degree-granting institution.
  • No application, origination, or disbursement fees.
  • No prepayment, late payment, or returned payment penalty.
  • No penalty for default or collections.
  • MEFA is a Credible lender.
  • No graduation requirement.

Eligibility Requirements:

  • U.S. citizenship or permanent residence.
  • No bankruptcies or foreclosures in the previous 5 years.
  • No defaulted student loans.
  • A minimum credit score of 670.
  • A minimum income of $24,000.

For more information or to apply, click here.

Loan Limits: $5,001 – $250,000
Fixed Rates: 2.98% – 6.04%
Variable Rates: 1.81% – 4.97% (6.00%+ Cap)
Terms: 5 to 20 years
Min. Credit Score: Undisclosed
Misc. Restrictions: California residents may refinance a minimum of $10,001; Kentucky residents who refinance $15,000 or less are limited to repayment terms of 10 years or less; Variable rates are unavailable in some states.

NaviRefi is an invite-only refinancer for borrowers with student loans from Navient Corporation. Navient subsidiaries Earnest Operations LLC and Navient Solutions LLC* service refinance loans from NaviRefi.

*Navient Corporation and Navient Solutions are defendants in ongoing lawsuits in multiple states alleging mismanagement of student loans and repayments.[3]

Program Information:

  • NaviRefi caps military member borrowers’ interest rates at 6.00%.
  • This lender offers fixed-rate refinancing in 49 states and in Washington, D.C.
  • Variable rates are available in 34 states.
  • NaviRefi uses the 1-month LIBOR to determine its variable rates.
  • Graduates of medical, dental, pharmacy, or veterinary doctorate programs may refinance up to $250,000.
  • 0.25% interest reduction for enrollment in auto pay.
  • Borrowers may apply for a short-term forbearance due to circumstances related to COVID-19.
  • This lender offers a total and permanent disability discharge and debt forgiveness in the event of the borrower’s death.
  • No graduation requirement.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • Employment or proof of steady income.
  • A student loan or current business with Navient.

NaviRefi and its sister company Earnest Operations LLC have not been implicated in ongoing lawsuits against their parent company, Navient Corporation, and its subsidiaries Navient Solutions LLC and Pioneer Credit Recovery alleging violations of the Fair Credit Reporting Act and the Fair Debt Collection Practices Act.[1][2]

For more information or to apply, click here.

Loan Limits: $7,500 – $175,000
Fixed Rates: 2.99% – 12.03%
Variable Rates: 1.61% – 10.21% (20.25% Cap)
Terms: 5, 10 or 15 years
Min. Credit Score: Undisclosed
Misc. Restrictions: Borrowers must be(come) Navy Federal Credit Union members

Navy Federal Credit Union is not exclusive to members of the Navy. Regulated by the National Credit Union Administration and the Bureau of Federal Credit Unions, this lender has a partnership with LendKey.

Program Information:

  • The minimum monthly payment is $50 or $25 with special permission.
  • Borrowers may apply for co-signer release after 12 consecutive, on-time principal and interest payments.
  • 20.25% variable rate cap.
  • 90-day SOFR determines variable rate.
  • 0.25% interest reduction for enrollment in auto pay.
  • Parent borrowers may consolidate loans for multiple children.
  • Parent borrowers may also refinance before their student has graduated.
  • Navy Federal does not sell its loans.
  • Borrowers are required to become members of Navy Federal Credit Union.
  • Membership is not limited to the Navy, but it is restricted to:
    • Members of any branch of the U.S. military, including active duty members, members of the Delayed Entry Programs (DEP), officer candidates, reserves, and veterans, retirees, and annuitants.
    • Family members of any of the above, including parents, grandparents, spouses, siblings, children (including adopted and stepchildren), grandchildren, and household members.
    • DoD civilian employees, including contractors, retirees, and other U.S. government employees assigned to DoD installations.

Eligibility Requirements

  • U.S. citizenship or permanent residency.
  • An established credit history.
  • A monthly income of at least $2,000 -OR- An income of at least $100 a month with a creditworthy co-signer whose monthly income is at least $2,000.
  • An associate’s degree -OR-
  • currently enrolled in an eligible school with loans in repayment.

For more information or to apply, click here.

PenFed

Loan Limits: $7,500 – $300,000
Fixed Rates: 2.89% – 4.78%
Variable Rates: 2.15% – 4.42% (10.00% Cap)
Terms: 5, 8, 12 or 15 years
Min. Credit Score: 700* (670 with co-signer)
Misc. Restrictions: Only available to U.S. citizens; borrowers must be(come) Pentagon Federal Credit Union members

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

Founded in 1935, the Pentagon Federal Credit Union was among the first credit unions founded under the Federal Credit Union Act, part of President Roosevelt’s New Deal.

Program Information:

  • The variable rate cap is 9.00% or 10.00% for loans with terms of 12 years or more.
  • 2.00% variable rate floor.
  • 1-month LIBOR determines variable rate.
  • Borrowers may apply for co-signer release after 12 consecutive qualifying payments.
  • Refinancing more than $150,000 has additional qualifying requirements.
  • Borrowers must be or become members of Pentagon Federal Credit Union.
  • Spouses may transfer a debt balance or refinance jointly.
  • PenFed does not sell its loans to other servicers.
  • No application or origination fees, and no penalties for prepayment.
  • PenFed is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship.
  • A bachelor’s degree or higher.
  • A credit score of 700 and a minimum income of $42,000 (for loans up to $150,000) -OR- A credit score of 725 and a minimum income of $50,000 (for loans up to $300,000) -OR- a credit score of 670, a minimum income of $25,000, and a qualifying co-signer.

For more information or to apply, click here.

PNC Bank

Loan Limits: $10,000 – $75,000
Fixed Rates: 3.44% – 6.74%
Variable Rates: 2.22% – 5.52% (18.00% Cap)
Terms: 5, 10 or 15 years
Min. Credit Score: Undisclosed
Misc. Restrictions: Borrowers may not be current students at the time of refinancing

PNC Bank’s Education Refinance Loan (PERL) is processed by Campus Door.

Program Information:

  • Offers a 0.50% interest rate reduction for automatic payments from a PNC account.
  • 1-month LIBOR determines variable rate.
  • Borrowers may apply for co-signer release after 48 consecutive qualifying monthly payments.
  • Up to 36 months of academic deferment may be available to borrowers who enroll full time in qualifying programs.
  • A PERL has no prepayment penalty.
  • The penalty for late payment is the lesser of $5.00 or 5.00% of the overdue amount.
  • No graduation requirement.
  • PNC Banks may sell or transfer a refinance loan to another institution at any time.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • A 24-month repayment history.
  • A steady income over the previous 2 years.
  • A 2-year credit history.

For more information or to apply, click here.

RISLA

Loan Limits: $7,500 – $250,000
Fixed Rates: 3.19% – 5.84%
Variable Rates: NA
Terms: 5, 10 or 15 years
Min. Credit Score: 680
Misc. Restrictions: NA

Founded in 1981, Rhode Island Student Loan Authority or RISLA is the non-profit financer behind the College Planning Center of Rhode Island. This lender is one of the few listed that offers an income-based repayment plan.

Program Information:

  • 0.25% interest rate reduction for enrolling in auto-pay.
  • RISLA offers income-based repayment (IBR) plans based on the Department of Health and Human Services (HHS) Poverty Guidelines.
  • The minimum monthly payment for an IBR is $10.
  • After borrowers make 25 years of qualifying IBR payments, their loans may be forgiven.
  • Borrowers may apply for up to 36 months of academic deferment to attend graduate school.
  • Up to 12 months of forbearance due to unemployment, disability, or hardship is allowable over the loan term in 3-month increments.
  • This lender offers total and permanent disability discharge in addition to discharge due to death.
  • Some loan programs allow spouses to refinance jointly.
  • Part-time students qualify for refinancing.
  • No application or origination fees.
  • No penalty for prepayment.
  • The penalty for late payment is 6% of the overdue amount.
  • $10 returned check fee or extra payment fee.
  • RISLA is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • No liens or bankruptcies.
  • Steady employment.
  • A credit score of 680 or above.

For more information or to apply, click here.

SELF Refi

Loan Limits: $10,000 – $70,000
Fixed Rates: 3.80% – 5.55%
Variable Rates: 2.50% – 4.10% (18.0% Cap)
Terms: 5, 10 or 15 years
Min. Credit Score: 700 (650 with co-signer)
Misc. Restrictions: For Minnesota residents only

SELF Refi is the Minnesota Office of Higher Education’s student loan refinance program.

Program Information:

  • Borrowers with certificates, diplomas, or associate’s degrees may refinance up to $25,000.
  • Borrowers with bachelor’s or more advanced degrees may refinance up to $70,000.
  • SELF sources credit scores using TransUnion’s FICO® Classic 04.
  • No application or origination fees.
  • No prepayment or early repayment penalties.
  • Borrowers may incur a late payment fee of up to $25 for payments made more than two weeks late.
  • There may be a returned payment charge of up to $15.
  • Parent PLUS loans are not eligible for refinancing.
  • The 1-month LIBOR determines variable rates.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • Maintain Minnesota residency.
  • Completed a postsecondary course of study, earning a certificate, diploma, or associate’s degree.
  • Have at least 60 days of steady employment -OR- have a spouse co-signer (after which qualification is based on household income and expenses).
  • No delinquencies, liens, or judgements exceeding $300,
  • A maximum debt-to-income ratio of 45% -OR- 60% with a qualified co-signer.
  • A credit score of 700 -OR- 650 with a qualified co-signer.

For more information or to apply, click here.

SoFi

Loan Limits: $5,000+
Fixed Rates: 2.99% – 6.99%
Variable Rates: 2.25% – 6.54% (9.95% Cap)
Terms: 5, 7, 10, 15 or 20 years
Min. Credit Score: 700 (soft minimum)
Misc. Restrictions: No co-signers

Social Finance, Inc. is an online-only specialty finance corporation founded by students and alumni of the Stanford Graduate School of Business. Since 2011, SoFi has refinanced over $30 billion in student loans.

Program Information:

  • Variable rates are capped at 9.95% or 8.95% for loan terms of 10 years or less.
  • 1-month LIBOR determines variable rate.
  • 0.25% interest reduction for enrollment in auto-pay.
  • To qualify for medical resident student loan refinancing (MRSLR), borrowers must have a minimum of $10,000 in debt.
  • MRSLR is only available to medical and dental graduates.
  • In Connecticut and Kentucky, the minimum debt for MRSLR is $15,001; in Pennsylvania, the minimum debt is $25,001.
  • Borrowers who lose their jobs may apply for unemployment protection, which includes job placement assistance and up to 12 months of forbearance over the life of the loan.
  • Residents of Mississippi and Minnesota are not eligible for MRSLR.
  • SoFi refinance loans are serviced by the Missouri Higher Education Loan Authority (MOHELA).
  • No application or origination fees.
  • No prepayment penalty.
  • SoFi is a Credible lender.

Eligibility Requirements:

  • U.S. citizenship or permanent residency -OR- a creditworthy co-signer with U.S. citizenship or permanent residency.
  • A steady source of income within 90 days of application.
  • An associate’s degree or higher.

SoFi is subject to a nationwide class action lawsuit alleging lending discrimination.[4] This is not to be confused with the unrelated filing by the Federal Trade Commission settled in 2019.[5]

For more information on SoFi, read our full review.

U-fi

Loan Limits: $5,000 – $500,000
Fixed Rates: 3.59% – 12.37%
Variable Rates: 1.20% – 11.72%
Terms: 5, 6, 10, 15, 20 or 25 years
Min. Credit Score: 680
Misc. Restrictions: NA

U-fi is a subsidiary of Nelnet, Inc. Like Navient, Nelnet has serviced federal loans, though this does not affiliate them with the ED, nor can these companies act on the department’s behalf. U-fi education refinance loans are serviced by Nelnet Bank and funded by Union Bank and Trust Company.

Program Information:

  • Borrowers with undergraduate degrees may refinance up to $125,000.
  • For borrowers with graduate degrees, including doctorates, MBAs and law degrees, the maximum debt balance is $175,000.
  • Borrowers with advanced degrees in a health profession may qualify for up to $500,000 in refinancing.
  • Borrowers may apply for co-signer release after 24 consecutive qualifying payments.
  • 1-month LIBOR determines variable rates.
  • 0.25% interest rate reduction for auto pay.
  • 10% of consumer complaints about federal student loan servicers submitted to the CFPB are in regard to U-fi’s parent company Nelnet.
  • No application or origination fees.

Eligibility Requirements:

  • U.S. citizenship or permanent residency.
  • A bachelor’s degree or higher.
  • A minimum credit score of 680 and a minimum annual income of $36,000 -OR- a qualifying co-signer.

U-fi has not been implicated in a class action lawsuit against Nelnet, Inc. that alleges violations of the Fair Debt Collection Act and Florida’s Consumer Collections Practices Act.[6]

For more information or to apply, click here.

UW Credit Union

Loan Limits: $5,000+
Fixed Rates: 3.14% – 7.15%
Variable Rates: 1.73% – 5.03% ( 15% cap)
Terms: 5, 7, 10 or 15 years
Min. Credit Score: Undisclosed
Misc. Restrictions: Borrowers must be(come) UW Credit Union members.

Founded by a group of professors in 1931, University of Wisconsin Credit Union has grown to over a quarter-million members; these members include students, faculty, staff, and alumni (and their families) of Wisconsin’s massive public postsecondary system.

Program Information:

  • 0.25% interest reduction for enrollment in auto-pay.
  • $50 minimum monthly payment.
  • No prepayment penalty.
  • Interest-only payment option for the first two years of the loan term.
  • $15 returned check fee.
  • Payments more than 10 days overdue are subject to a penalty that’s the lesser of $10 or 5% of the amount of the past due payment.
  • Borrowers may apply for co-signer release after 36 consecutive, qualifying payments.
  • 3-month LIBOR determines variable rates.
  • UWCU’s loan process takes 2-4 weeks from application to loan dispersal.

Eligibility Requirements:

  • UW Credit Union membership.
  • 4 years of credit history -OR- a qualified co-signer.

For more information or to apply, click here.

Bar Graph: Total Deferment Terms Available, Restrictions and Eligibility Requirements Apply

Frequently Asked Questions (FAQ)

What exactly is refinancing?

Refinancing a student loan means paying off that loan immediately with another loan from a separate lender. Borrowers may choose to refinance a single loan, or they may opt to pay off multiple loans at once.

When is the best time to refinance?

If you plan to refinance, it’s best to do it as soon as possible in order to start paying interest at a reduced rate. People also choose to refinance when their financial situation changes. If your credit score has improved since you qualified for your initial loan, refinancing may give you the opportunity to repay your debt at a lower rate of interest.

What’s the difference between refinancing and consolidation?

Consolidation usually refers specifically to Federal Direct Loan Consolidation. It’s similar to the refinance process, but instead of taking out a whole new loan, consolidation combines existing loans. Consolidating federal loans also retains certain borrower protections included with those loans.

Does refinancing a federal loan mean giving up federal benefits and protections?

Because refinancing means getting a new loan, refinancing a federal loan means losing federal protections. Such benefits include student loan forgiveness or discharge and temporary federal student debt relief such as the CARES Act of 2020.

Can I refinance just one of my loans?

Yes. Partial student loan financing is an option for borrowers who have multiple loans with varying interest rates. If just one or two loans carry a high interest rate, it may not be cost effective to refinance all of them. It is also possible to consolidate federal loans and refinance private loans separately.

Can I refinance a loan more than once?

Yes. As you have more time to build a solid credit history, you may eventually qualify for an even lower rate. If your income increases significantly, you may also wish to shorten the term of your loan to pay it off quicker.

How long does refinancing take?

The entire process usually takes a month or two, up to 110 days. For some lenders, prequalification takes a few minutes with their online application. Final qualification may take 1 to 3 business days. Once you receive your loan offer, you’ll have 30 days before it expires. Refinancers say to expect your original loans to be paid off in 14-30 days. Refinancers generally say the first repayment comes due after 30-45 days. For some refinancers, the first repayment due date is relative to the time of disbursement; for others it depends on the date of origination.

Does refinancing hurt my credit score?

In order to qualify you and confirm your APR, your lender will need to perform a hard credit inquiry. This is the type of credit pull that has the potential to damage your FICO score. Additionally, closing a line of credit has an impact on your score. While refinancing opens a new line of credit, paying off the initial loan(s) also closes one or more lines of credit.

What if I declare bankruptcy?

Most lenders won’t refinance loans for someone who has declared bankruptcy. Declaring bankruptcy after refinancing will not necessarily eliminate the debt. In early 2020, a New York federal judge discharged over $200,000 in student loans for one borrower who declared bankruptcy. This is not standard, however.

Should I consult a financial advisor before I refinance?

Your refinance lender should send you a number of legal disclosures. Read these disclosures carefully and make sure you understand your rights and responsibilities. If you still have concerns or there is anything you do not understand, it may be wise to meet with a third-party advisor. A financial professional may also alert you if anything in your loan contract seems suspicious.

Are there student debt relief scams?

In 2019, the Federal Trade Commission facilitated the repayment of more than $230 million to student borrowers who had been scammed. Recent investigations include:

  • Student Debt Doctor
  • Student Debt Relief Group
  • Strategic Student Solutions
  • Student Aid Center
  • Alliance Document Preparation
  • A1 DocPrep, Inc.

For a complete list of people and companies banned from participating in debt relief businesses, click here.

What are the signs of a student debt relief scam?

The FTC has distributed more than $1 million to the customers of a company that did business under multiple names, including American Student Loan Consolidators, BBND Marketing, and United Processing Center. Many companies do business under more than one name or change names when their services change. Multiple concurrent business names, however, may be designed to confuse clients and pass blame. Other signs include:

  • Asking for your Federal Student Aid or FSA ID password. No legitimate student loan servicer, even those working with the U.S. Department of Education, will ever ask for your FSA password. Do not share this information with any lender.
  • Excessive upfront fees. It’s normal for servicers to charge for their services, such as initiating a line of credit or paying off loans on your behalf. Dozens of monthly fees or one-time fees in excess of $200, however, are not standard.
  • Promises of immediate loan forgiveness. Loan forgiveness in the event of death is an industry standard. Other than that, private companies almost never forgive loan debt. At least one legitimate nonprofit company offers the potential for loan forgiveness on student debt more than 25 years old. Student loan forgiveness for federal loans is possible, but rare.

If you suspect a student loan debt relief scam, submit a complaint to the Consumer Financial Protection Bureau and the Federal Trade Commission. You can also report the scam to the Attorney General of your state.

Applications for federal student loan consolidation are free. Private companies charging fees for federal loan consolidation applications have no affiliation with the U.S. Department of Education.

Who Qualifies for Refinancing

Every financer has different requirements. Certain qualifications, however, are virtually universal.

  • Refinancing eligibility is restricted to adults aged 18 years or of the age of majority in their state of residence.
    • In Alabama and Nebraska, the age of majority is 19.
    • In Puerto Rico, borrowers must be 21.
  • Student loan refinancing is generally limited to U.S. citizens and permanent residents.
    • At least 75% of refinancers require U.S. citizenship or permanent residency.
    • Non-residents with certain visas may be eligible to apply with a qualified co-signer.
  • Borrowers must have an established credit history.
    • 650 is the lowest advertised minimum credit score.
    • 673 is the median average required credit score.
    • A lower credit score may be acceptable with a co-signer.
  • Borrowers must have a minimum income or steady employment.
    • Lenders may require steady employment for the previous 12 months or more.
    • Income from savings or trust may be acceptable.
    • Some lenders accept an offer of employment within a certain period.
  • Refinancing is generally limited to graduates with an associate’s degree or higher.
    • Some lenders accept soon-to-be graduates or nongraduates.
    • Nongraduates may be eligible for refinancing in some cases.
    • Applicants with higher degrees may be eligible to refinance higher debt balances.
  • Refinancing requires a minimum debt balance of $5,000 or higher.
    • 43% of refinancers require a minimum debt balance of $5,000.
    • 39% of refinancers require a minimum debt balance of $10,000 or more.
    • The highest minimum debt balance is $60,000.
    • The highest debt balance limit is $500,000.
    • Some financial servicers have no maximum debt balance.

Calculate Refinancing Risks

Student loan refinancing potentially has serious, long-term consequences. Our researchers triaged lenders based on risk-benefit analyses. Consumer complaints and federal investigations carry greater weight than lender claims and popular media sources. Risk assessment used many variables, including but not limited to:

  • Variable rate caps.
  • Loan term options.
  • Credit requirements.
  • Maximum and minimum loan amounts.

Refinancing Red Flags

High-risk lenders may have policies or consumer feedback common among alleged and confirmed student debt relief scams. Lack of corporate transparency, a high number of consumer complaints relative to company size, and repeated lawsuits are all red flags.

  • A class action lawsuit filed in July of 2020 alleges Discover Bank “imposed restrictions on student loan services based on immigration status”. The CFPB also found Discover guilty of illegal student loan practices in 2015, ordering the company to refund $16 million and pay a $2.5 million penalty. [7][8]
  • NaviRefi‘s parent company, Navient Corporation, is subject to multiple ongoing lawsuits involving 33 states and the Consumer Financial Protection Bureau (CFPB). The Federal Trade Commission (FTC) has also charged Navient with predatory lending in the past. Navient receives an average of 6 consumer complaints per employee. [1][2][3][9][10][11]
  • Navy Federal Credit Union limits corporate transparency and has an above-average rate of consumer complaints per employee. The credit union recently settled a $16 million class action lawsuit in relation to fees for insufficient funds. [9][10][11][12][13]
  • PNC Bank also limits corporate transparency and has an above-average rate of consumer complaints per employee. PNC is currently subject to a class action lawsuit, but the suit is related to the bank’s Paycheck Protection Program. [9][10][11][14]
  • SoFi has been subject to FTC charges in the past. While the company has relatively few consumer complaints in terms of employee size and revenue, it does currently face a nationwide class action lawsuit that alleges lending discrimination. [4][5]
  • U-fi is a subsidiary of Nelnet. Nelnet has a hefty list of complaints with the CFPB and currently faces civil litigation. U-fi also fails to disclose its variable rate cap and offers terms that are, for the most part, below average. [6]
  • iHelp is the name of the platform used to service loans from the financier known as ZuntaFi or Reunion Student Loan Finance Corporation. ZuntaFi also claims Student Loan Finance Corporation as its servicer. The company receives a very high rate of consumer complaints, most of which are in regard to billing and collections. [15]

Pie Chart: Refinance Lenders' Comparative Annual Revenue

Refinance with Caution

Legal and financial language is notoriously difficult to decode. Always use caution when refinancing, but pay especially close attention to the service areas where lenders are weakest at best and predatory at worst.

  • Citizens Bank offers comparatively high APRs and does not disclose a required minimum credit score. The company receives relatively few consumer complaints, however. This indicates that, while Citizens is unlikely to provide the best offer, their customer service is above average. While the CFPB initiated a suit against Citizens in January of 2020, this was in relation to its handling of credit card disputes. [16]
  • College Ave has high APRs and a high rate of complaints. Every $125,000 the company makes generates one consumer complaint. College Ave’s best feature is an exceptional number of term limit options, giving borrowers the ability to name their own loan term anywhere between 5 and 20 years. They also accept applicants with lower credit scores.
  • Earnest would be considered acceptable if it weren’t for the company’s association with Navient. Acquired by the student loan giant in 2018, Earnest has received more complaints in the past three years than its corporate peers. The company continues to receive high praise from financial specialists, however. Furthermore, its term offerings are just above average, including low APRs and a lenient credit policy. [1][2][3]
  • EDvestinU is a program under the New Hampshire Higher Education Loan Corporation. While EDvestinU itself hasn’t garnered much criticism, NHHELC receives a high rate of consumer complaints. Furthermore, EDvestinU has high credit restrictions with rates and terms just below average.
  • First Republic Bank may be a good choice for refinancing under a very specific set of circumstances. Because First Republic offers refinancing as a personal line of credit, there are fewer restrictions regarding what kind of loans a borrower may refinance. For example, a personal loan used to pay bills during the time the borrower was in school may be included in the refinance loan disbursement. Additionally, First Republic’s high minimum balance requirement ($60K) makes it an option for borrowers with higher debt balances.
  • MEFA has quite a few consumer complaints directly related to their refinancing services. The company’s other weak points as a lender are its term limits and minimum credit score. With a rather high variable rate cap (20.00%), it is unlikely most refinancers will receive their best APR from MEFA.
  • PenFed seems to have average customer service but a number of favorable terms for borrowers. On paper, PenFed ranks just below Laurel Road as far as attractive offers and flexibility. PenFed currently faces a class action lawsuit from March 2020 alleging that it misled customers about overdraft fees.
  • RISLA receives relatively few consumer complaints. The company has fairly strict eligibility requirements, however and does not offer a variable rate.

Bar Graph: Variable Rate Caps Among Lenders

Acceptable Refinance Lenders

A low-risk (not no-risk) refinance lender is the safest, most conservative choice for refinancing.

  • Advantage is an inoffensive, middle-of-the-pack servicer. The company is unlikely to provide the best terms available. Its most redeeming qualities are its co-signer release and many deferment options.
  • Brazos has the lowest variable rate cap among the refinance lenders listed here. The company receives one consumer complaint for every $35 million in revenue. Credit score requirements are rather high, however, and refinance services are limited to residents of the State of Texas.
  • Commonbond has a very low variable rate cap, especially considering their lenience in regard to FICO scores. This lender also offers some of the most flexible debt balance limits and accepts applicants with certain visas provided they also have a co-signer.
  • ELFI has a rather high minimum debt balance at $15K, but its loan terms are agreeable. Its APRs are among the lowest in the industry. The company also has reasonable credit requirements and receives a low rate of consumer complaints.
  • Laurel Road offers some of the best terms and benefits available. With a very low rate of consumer complaints, this company offers a number of services catering to borrowers educated and employed in healthcare.

Pie Chart: Debt Balance Restrictions (Minimums) Among Refinancers

Alternatives to Refinancing

When it comes to private student debt, there aren’t many options for restructuring loans. That doesn’t necessarily mean, however, that refinancing is your best choice.

  • If your goal is to reduce your monthly payment, it may be more realistic to reduce spending elsewhere or apply for special assistance.
  • Income-based repayment or income-contingent repayment plans are available for federal student loans.
  • Federal loan borrowers may apply for deferment or forbearance for their federal student loans.
  • Student loan forgiveness is an option for many federal loans depending on the borrower’s circumstances.
  • Among student borrowers who file for bankruptcy, those who seek to eliminate some or all of their student loan debt have a 40% success rate.

When Shouldn’t You Refinance?

The purpose of refinancing is to help you improve your financial position. Never refinance unless you’re sure you can save money or otherwise improve your financial standing.

Do you have a low credit score or no credit history?

If your credit is just okay, a co-signer may help you qualify for a refinance loan. That doesn’t mean, however, that you’ll secure a low APR. A poor credit history or a low FICO score limits your options. Work to improve your credit score before refinancing.

Is your income unpredictable or subject to change?

If your income varies from month to month, a reputable lender is unlikely to refinance your loan at a reduced rate. Furthermore, few private refinancers offer any kind of debt relief, and income-based repayment plans are practically unheard of.

Do you want to qualify for federal programs and benefits?

Refinancing federal loans disqualifies them from certain federal benefits and legal protections, such as student loan forgiveness and discharge as well as income-based repayment, deferment, and forbearance. Private refinancers offer few deferments – or none at all. Meanwhile, federal loans may be deferred for any of the following reasons:

  • Academic enrollment
  • Graduate fellowship
  • Internship or residency
  • Peace Corps
  • Volunteer employment
  • Parental leave
  • Working mother
  • Teacher shortage
  • Public health service
  • Military duty
  • Economic Hardship
  • Unemployment
  • NOAA
  • ACTION
  • Temporary total disability

The federal student loan debt relief that was part of CARES has been extended to September 30, 2021. Learn more about student debt relief with the CARES act here or contact OFSA.

Bar Graph: Average Federal Consolidation Loan Interest Rates, Estimates based on recent federal interest rates and trends

Federal Consolidation Loans

It may ultimately be more cost effective to consolidate your federal loans even if it means your private loan debt balance falls below the threshold for refinancing. Federal education loans that be combined into one federal loan are:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Subsidized Federal Stafford Loans
  • Unsubsidized Federal Stafford Loans
  • Direct PLUS Loans
  • Federal Family Education Loan Program (FFEL) PLUS Loans
  • Supplemental Loans for Students (SLS)
  • Federal Perkins Loans
  • Federal Nursing Loans
  • Health Education Assistance Loans (HEAL)
  • Health Professions Student Loans
  • Loans for Disadvantaged Students
  • Parent Loans for Undergraduate Students
  • National Direct Student Loans
  • National Defense Student Loans
  • Guarantees Student Loans
  • Federal Insured Student Loans
  • Auxiliary Loans to Assist Students
  • FFEL Consolidation Loans and Direct Consolidation Loans (under certain circumstances)

Sources

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