Student Loan Refinance Strategy as the Federal Interest Freeze Winds Down
Refinancing before the federal interest rate freeze ends is risky. However, it is possible to lock in a low interest rate without missing out on any possible extensions.
Student Loan Refinancing
Student loan refinancing is a great way to lower interest rates and speed up debt elimination. However, refinancing isn't the best choice for all borrowers.
Student Loan Refinancing
Student loan refinancing is a great way to lower interest rates and speed up debt elimination. However, refinancing isn't the best choice for all borrowers.
Who Should Refinance?
- Borrowers with federal student loans should not refinance during the Covid-19 interest freeze.
- Borrowers with private loans should refinance if they can get a lower interest rate or better loan terms.
Refinance Requirements
- Applicants usually need a credit score in the mid-600s to 700 range.
- Lenders don't publish Debt-to-Income Ratio requirements, but they look at DTI very closely.
- Having a cosigner can enhance your chances of approval, but cosigning is often a risky decision.
Getting the Best Rate
- The lowest advertised rates are usually for 5-year variable-rate loans.
- Borrowers looking for a longer loan should start with the lenders advertising the lowest rates for 20-year loans.
- Shopping around is the only way to verify that you have gotten the best rate possible.
| Rank | Lender | Interest_Rates_ | Loan_Amounts____ |
|---|---|---|---|
| 1 |  | 1.74% – 6.25% | $5,000 – No Max |
| Splash Financial Review: Splash has competitive rates, but they start slightly higher than the top lenders. Splash also offers unique 8 and 12 year repayment terms. | Application + Up to $500 Bonus | ||
| 2 |  | 1.98% – 7.04% | $5,000 – $500,000 |
| CommonBond Review: CommonBond has a higher approval rate than many other lenders. The interest rates offered are among the best and customer satisfaction appears to be very high. | Application + $150 Bonus | ||
| 3 |  | 1.86% – 5.99% | $15,000 – No Max |
| ELFI Review: ELFI routinely offers excellent interest rates. Even though ELFI is new, it is the product of a regional bank that has been in business for decades. | Application + $150 Bonus | ||
| 4 |  | 1.89% – 6.00% | $5,000 – No Max |
| Laurel Road Review: Laurel Road currently has excellent approval rates combined with solid interest rates. Laurel Road also has a specialized program for medical professionals. | Application + $150 Bonus | ||
| 5 |  | 1.74% – 6.94% | $5,000 – No Max |
| SoFi Review: SoFi consistently offers the best actual interest rates to applicants. Combine that with SoFi's unique job placement program for borrowers and you have a winner. | Application + $150 Bonus | ||
Click here for the full list of national lenders and reviews.
Methodology: Learn how these rankings are generated.
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