The Best Student Loan Refinance Options for 2024
Updated: December 28, 2023
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Student loan refinancing is when a lender pays off your debt by issuing you a new loan. It can be an effective debt management strategy because you may get better interest rates or shorter loan terms — both of which could allow you to save money in the long run.
MoneyGeek analyzed several lenders to help you find the best student loan refinance option for your specific needs. These are private lenders, and the order in which they're presented doesn't indicate their ranking. So, if the first lender doesn't appeal to you, don't hesitate to check out the others on our list.
Citizens Bank Review
SoFi Review
Discover Review
Earnest Review
PNC Bank Review
Laurel Road Review
Rhode Island Student Loan Authority (RISLA) Review
How to Find the Best Student Loan Refinance Option
Knowing how to refinance your student loan can help you make the right decision for your needs. MoneyGeek outlined several steps to guide you through the process from comparing potential lenders to preparing the necessary paperwork.
Compare lenders
MoneyGeek's private student loan refinance options are recommendations, so don't hesitate to consider other options. When comparing lenders, ensure you factor in the elements that may make repayment less challenging. These include APRs, loan terms, fees and penalties.
It's also best to look into some features that may come in handy. For example, SoFi allows a 24-month forbearance, which not all lenders offer.
Get pre-qualified
One way to see how manageable a refinance would be for you is by getting pre-qualified. This will give you an idea of how much interest a lender is willing to offer based on your personal and financial information.
Fortunately, most lenders only do a soft credit pull during pre-qualification, which means it won't affect your credit score. This way, you'll know how much you'll need to pay each month and if it fits your budget.
Choose a lender and apply
Comparing lenders allows you to narrow your options, making finding the best deal more likely. Once you identify your preferred lender, you can pursue your application.
Submit necessary documents
When you're trying to refinance a student loan, you'll need to submit several documents to your lender. These usually include the following:
- Proof of employment
- A government-issued ID
- Your transcript or diploma
- Proof of residency
- Documents for your existing student loan
Remember that requirements vary between lenders. It's best to confirm whether or not you should prepare other documents.
Complete your application and make payments
Once you've gathered everything you need to submit, wait for your lender's decision.
Remember, when you refinance your private student loan, you'll have a different monthly payment and a new due date. It might take a little getting used to — you may want to set reminders to ensure you don't miss any.
Frequently Asked Questions About Student Loan Refinance
MoneyGeek answered common questions about how to refinance student loans to help you decide whether or not it's the best move for you.
Interest rates vary between lenders, but you can usually choose between fixed and variable rates.
When comparing lenders, make sure you compare the rates they offer. After all, one reason why borrowers consider refinancing student loans is to get lower rates.
Having a co-signer is a good idea if you can't meet a lender's eligibility requirements. However, remember that not all lenders offer this option.
Ideally, the earlier you refinance your student loan, the better off you'll be. After all, the sooner you get lower interest rates, the more money you'll save.
However, there are other factors to consider, such as your credit score, current income and debt-to-income ratio. Knowing these gives you the best chance of getting lower rates or being able to afford shorter loan terms.
You can refinance your student loan through different private lenders. Traditionally, borrowers approach credit unions and banks. These days, online lenders also offer student loan refinancing.
Yes, you can refinance consolidated student loans. This applies for private student loans and federal ones.
You can apply with a co-signer if you don't qualify for a refinance on your own.
However, it's best to understand why you didn't qualify in the first place, which gives you a better idea of what you need to improve. For example, if you need a higher credit score, you can begin taking steps to improve it.
Usually, lenders don't charge origination or application fees when you're refinancing your student loan. Some don't apply a prepayment penalty even if you pay your loan early.
However, nothing beats reading the fine print of your loan agreement. This way, you'll know whether you need to watch out for any fees.
sources
- Citizens. "Education Refinance Loan Repayment Examples." Accessed October 27, 2022.
- Citizens. "Refinance Your Student Loans." Accessed October 27, 2022.
- Citizens. "Refinancing Student Loans — FAQs." Accessed October 28, 2022.
- Citizens. "Student Lending Disclosures." Accessed October 28, 2022.
- Discover. "Consolidate Your Student Loans." Accessed October 27, 2022.
- Discover. "Repayment Assistance Options." Accessed October 28, 2022.
- Earnest. "Eligibility Guide." Accessed October 27, 2022.
- Earnest. "Refinance Student Loans." Accessed October 27, 2022.
- Earnest. "What is the Minimum and Maximum Student Loan Balance Earnest can Refinance?." Accessed October 27, 2022.
- Earnest. "Who Should Consider Refinancing with Earnest?." Accessed October 27, 2022.
- Earnest. "What Does It Mean That I Can Set My Own Monthly Payment?." Accessed October 27, 2022.
- Laurel Road. "Refinancing Plus Laurel Road Linked Checking." Accessed October 28, 2022.
- Laurel Road. "Refinance Student Loans." Accessed October 28, 2022.
- PNC. "Student Refinance Loans." Accessed October 28, 2022.
- RISLA. "Refinancing Education Loans." Accessed October 28, 2022.
- RISLA. "Refinance Loans." Accessed October 28, 2022.
- RISLA. "FAQ for Refinance Loans." Accessed October 28, 2022.
- SoFi. "Frequently Asked Questions — Student Loan Refinance." Accessed October 27, 2022.
- SoFi. "Info Center." Accessed October 27, 2022.
- SoFi. "Student Loan Refinancing." Accessed October 27, 2022.
- SoFi. "Eligibility Criteria." Accessed October 27, 2022.
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