|Lender||Rank||Interest Rate Range||Fixed or Variable||Max Repayment Length||Loan Amounts||Origination Fee||New Customer Bonus||Cosigner Release||Full Review||Lender Website|
|SoFi||1||2.20% – 7.99%||Both||20 Years||$10,000 – No Max||0%||$150||Yes; No Wait Period||Apply|
|CommonBond||2||2.14% – 7.99%||Both||20 Years||$10,000 – No Max||0%||$150||36 months||Apply|
|LendKey||3||2.14% – 6.92%||Both||20 Years||$7,500 – $125,000 Undergrade; |
$7,500 – $175,000 Graduate
|Darien Rowayton Bank||4||3.64% – 7.20%||Both||20 Years||$5,000 – No Max||0%||$150||Yes; No Wait Period||Apply|
|Earnest||5||2.22% – 7.45%||Both||20 Years||Unknown||0%||$150||Yes; No Wait Period||Apply|
|Purefy (formerly CordiaGrad)||6||3.00% – 6.75%||Both||12 Years||$20,000 – $350,000||0%||–||12 months||Apply|
|Citizens/Charter One Bank||7||2.24% – 8.94%||Both||20 Years||$10,000 – $90,000 Undergrade; |
$10,000 – $170,000 Dental, Medical & Law
|College Ave||8||2.50% – 8.50%||Both||15 Years||$5,000 – $150,000; |
$5,000 – $250,000 Graduate Health;
|U-fi||9||3.41% – 9.07%||Both||25 Years||$5,000 – $125,000 Undergrade; |
$5,000 – $150,000 Graduate;
$5,000 – $175,000 MBA and law;
$5,000 – $225,000 Graduate Health;
|Wells Fargo||10||3.75% – 12.29%||Both||20 Years||$5,000 – $120,000||0%||–||24 months||Apply|
|iHelp||11||6.22% – 9.04%||Both||15 Years||$25,000 – $100,000 Undergrade; |
$25,000 – $150,000 Graduate
|Prosper||12||6.73% – 34.12%||Fixed||5 Years||$2,000 – $35,000||1% to 5%||–||NA||Apply|
Using this resource…
- The idea behind the chart is to organize a large amount of information into a small space. It should be a helpful tool, but it cannot possibly include every term and condition for every company.
- The goal is to provide a company overview, provide a starting point in your research, and make sure that you do not miss out on any existing promotions.
- Interest rates normally change quarterly, but they can change at any time. The rates listed here were last updated on 8/7/16.
- The goal is to have a full list of every student loan consolidation company. If there is a national lender that you do not see on this list, please let us know, so we can get them reviewed and compare them to the other lenders.
Tips for getting the best rate…
- The company that advertises the lowest rate will not always have the best rate for you. The lowest advertised rates are for borrowers with excellent credit who borrow short-term (5 years). The best rate for the loan length you need could be with a number of different companies.
- Shopping around will not hurt your credit score. The credit bureaus treat multiple credit inquires in a short period of time as one single credit check so that you are not penalized for shopping around.
- Don’t try to time the market. You don’t need to do any guesswork to figure out when interest rates are at their lowest. Unlike refinancing a house, where there are closing costs, there is no cost to you to consolidate your student loans. If another company starts offering lower rates in 6 months, refinance again. More on timing of refinancing applications…
- Think about fixed vs. variable rate loans. The variable rate loans often are the lowest advertised, but they can go up. If you will be borrowing for a long time, consider a fixed rate loan, even if it means a slightly higher interest rate right now.
- Machines, not humans, decide the interest rates. It is normally a waste of time to try to negotiate a lower interest rate with a lender. The interest rate determination is based upon a computer algorithm. Your time chasing a lower rate is better spent by reaching out to many lenders.
Tips for finding the best student loan consolidation company…
- Find out for yourself. Just because everything can be done online does not mean it should. Interact with their customer service as much as possible to get a feel for what it is like to do business with the company. The best time to do this is when you have an approval in hand. You can quiz them on the process and the terms of the deal they have proposed to you.
- Make them win your business. If two lenders offer the same rate, call them both and ask why you should go with one lender over the other. Force them to explain why their loan terms or programs are better than the competitor’s option.
Mistakes to Avoid…
- Don’t give up the federal perks too soon. If you have federal student loans, you can consolidate them with a private company, but it isn’t always a good idea. You have to give federal benefits like income driven repayment plans and student loan forgiveness programs. Going the private route commits you to paying off the loan in full, so make sure the interest rate savings is worth what you are giving up. More on weighing federal benefits against private savings…
- Don’t think a rejection is permanent. A minor change in circumstances can be the difference between an acceptance and a denial. If you pay off a loan or get a new job, you become a significantly different applicant. More on turning a rejection into a denial…
- Don’t put too much weight on a cosigner release. Some lenders are better than others when it comes to releasing a cosigner from the loan, but there is little incentive for any lender to grant a cosigner release. Lenders would much rather have two people responsible for the loan instead of one, so they will look for any reason to deny the release. For your financial planning, if you absolutely must have a cosigner, assume they will be on it for the life of the loan. More on understanding cosigner releases…
Understanding the consolidation process…
- Student loan consolidation is a simple process. Find a new lender and get approved for a loan. Your new lender then pays off your old debts in full. With your old debt paid off, you now owe the new lender. Payments are made to the new lender at the lower interest rate and/or lower monthly payment that you previously agreed upon.
- This is not an all or nothing process. If you have two loans at 3% and two loans at 11%, you can refinance the high interest debt and leave the low interest debt alone.
- Consolidation and refinancing are pretty much the same thing. Refinancing means one lender pays off a single existing loan. Consolidation means a lender pays off multiple existing loans and you repay one larger single loan. These terms are often used interchangeably.
- Ask for help. Major financial decisions are never easy. Do as much research as possible, consider consulting financial professionals, and don’t be ashamed if you don’t understand something. Try our student loan forums to ask questions, exchange ideas, and get tips.