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Getting a Lower Interest Rate with Navient

Navient may temporarily reduce interest rates to help borrowers struggling with their loans. Learn how to apply for the Rate Reduction Program.

Written By: Michael P. Lux, Esq.

Last Updated:

Getting a Lower Interest Rate with Navient

Navient may temporarily reduce interest rates to help borrowers struggling with their loans. Learn how to apply for the Rate Reduction Program.

Written By: Michael P. Lux, Esq.

Last Updated:

Borrowers struggling with their Navient loans may have a lifeline available to keep payments affordable.

The program is called the “Rate Reduction Program”. It is designed to give borrowers a break who are struggling with their private student loans.

The exciting part of this program is that it applies to private student loans. While there are great federal programs for lowering payments and student loan forgiveness, the Rate Reduction Program is somewhat unique in the private sector.

Rate Reduction Program Benefits

Borrowers who sign up for the Rate Reduction Program can get their interest rates lowered down to 3% or lower depending on individual circumstances. For those with double-digit interest rates, it is a huge break.

The major downside with the Rate Reduction Program is that Navient doesn’t want to make it too easy to sign up for or too popular. When people sign up, Navient makes less money on interest. The program is good for them, because it keeps people paying, and some money is better than none. However, Navient clearly has the motivation to keep this program as a last resort for borrowers.

Rate Reduction Enrollment

If you want to get signed up for the rate reduction program, try these steps:

  1. Start out organized – Navient will have a ton of questions about your finances, so have detailed information about your income and all of your monthly expenses.
  2. Talk to someone from the Rate Reduction Program – When you call the standard Navient number, they will first direct you to a customer service representative. This person may not even be aware of the rate reduction program. Asking to be transferred to the people who administer the Rate Reduction Program directly saves you a bunch of time and increases your odds of success. Speaking with the collections department may also work. Over the years enrollment in rate reduction has been something of a moving target, so persistence is key.
  3. Work with the person on the other end of the phone – The interest rate reduction is not a term of your student loan or a legal requirement. Navient is under no obligation to lower your interest rate. Being nice instead of demanding will increase your odds of success.
  4. Don’t forget to re-apply – The interest rate reduction is temporary. If you want to stay in the program, you must reapply. Be sure to set a reminder for yourself so that you don’t forget.

If you are denied…

If you cannot get your interest rate lowered, it is likely because Navient thinks you are making enough money to afford your student loans at your current interest rate.

It obviously sucks if they can lower your high-interest loans, but the good news is that you might be able to take your business elsewhere.

If Navient thinks you can afford your debt, other lenders may think the same thing. By refinancing your loans, you can permanently lock in a lower rate. There are a ton of companies offering student loan refinancing.

If you do get a lower interest rate…

If you can get a lower interest rate, through Navient or another company, take advantage of it.

Use the money you save each month and apply it towards your high-interest loans. The more you can attack the principal balance of your debt, the sooner it will be gone.

About the Author

Student loan expert Michael Lux is a licensed attorney and the founder of The Student Loan Sherpa. He has helped borrowers navigate life with student debt since 2013.

Insight from Michael has been featured in US News & World Report, Forbes, The Wall Street Journal, and numerous other online and print publications.

Michael is available for speaking engagements and to respond to press inquiries.

27 thoughts on “Getting a Lower Interest Rate with Navient”

  1. We should make a class action lawsuit against navient. They do not disclose that income based repayment leads to a 1099 write off. If I knew that when I graduated and applied for income based repayment then I would have refinanced then when my loan amount was $378,000 now my loans have ballooned to $540,000 due to capitalized interest. There needs to be consumer protection. We will be slaves to this debt! We all need to ban together with a class action lawsuit!

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