Refinancing Student Loans - What You Need to Know

Why Refinance?
Student loans can be a huge burden to many Americans, and there has been much talk of government intervention in helping relieve some of the debt, but in the meantime, many are putting up with high payments and high interest rates. The main reasons for refinancing are to lower interest rates, lower payments, and to consolidate several loans into one. These have some attractive advantages including possibly lowering your monthly payment, shortening the length of a loan, and limiting the number of lenders you may have to make payments to.
 
Things to Consider
There are some decisions to weigh before filling out the loan application and committing to a new loan or lender. The process for refinancing loans closely resembles that of any other standard loan, but a student loan refinance often requires that the degree has already been earned. Here are some other factors that you should consider before applying for a new loan:
 
Timing
Often, borrowers obtain student loans when they have little or no income and are unsure of their financial future. Refinancing generally happens after finally earning a degree and becoming more financially stable. If you now have a steady job and are feeling surer of your income, the timing to refinance may be just right.
 
Credit Score
Like other loans, getting the best interest rates depends heavily on your credit score. Just like a car loan or mortgage, the higher your credit score, generally, the lower interest rates you’ll be offered. Make sure that your credit history is accurate and error-free. It’s not necessary to wait until you have a perfect credit score to apply for a loan; while you may not get the lowest rate offered, it can be lower and better than your current interest rate. 
 
Current Interest Rates
Interest rates have been the lowest in decades, but rates always vary and may go up soon. If you are considering consolidating or refinancing, doing so now may give you significant savings as opposed to waiting months or years.
 
Variable Interest Rates
If your current loans have variable interest rates, refinancing for a set rate may be your best option for a secure financial picture. With possible increases in interest rates looming, variable rates could increase greatly in the next few months which would also mean a higher regular payment. Locking in a low rate now can save you thousands in increased payments in the coming years.
 
When You Are Ready
Our student loan process, like all of our other loans, is simple and straightforward. We offer loans spanning from 5 to 15 years, and up to $250,000, depending on your needs. Call 800.645.8070 or visit our Student Loans page to learn more about lowering your monthly payments with a lower rate.