refinance navient good idea

Should I Refinance My Navient Loans?

Michael Lux Blog, Refinance, Strategy, Student Loans 0 Comments

Dealing with Navient is a headache for many student loan borrowers.  Navient, the result of student loan giant Sallie Mae’s rebranding, has quickly developed a reputation for consumer issues.

For many borrowers, refinancing Navient loans seems like the answer to their problems.  The idea of taking their student loan business elsewhere AND getting a lower interest rate sounds like a no-brainer.  Unfortunately, refinancing isn’t the best approach for all Naivent borrowers.  For some, it can be a huge mistake.

When Refinancing Navient Loans Makes Sense

In order to refinance wisely, borrowers need two things to come together: opportunity and strategy.  Determining whether or not refinancing is a good idea is fairly simple.

  • Strategy – A refinance only makes sense if it will save money.  For private student loan borrowers, the question is simple… can I get a lower interest rate elsewhere?  If the answer is yes, a refinance strategy makes sense.  For federal student loan borrowers, the question is a bit more difficult.  Programs like income-driven repayment and Public Service Loan Forgiveness can be great resources.  If these federal perks will be utilized, dealing with Navient may be a necessary evil.  If the perks that go with federal loans will never be needed, opting for a lower interest alternative can make sense.
  • Opportunity – Refinancing is a great option, but not everyone can do it.  Lenders like Laurel Road and SoFi offer interest rates starting below 3%, but the catch is that perspective customers need to have a decent income and credit score.  For these lenders to make money on their low interest rate loans, they have to be certain that borrowers will be able to pay it back in full.  The good news for borrowers is that each lender evaluates applications differently.  Several lenders may see you as a bad bet and reject your application, but it only takes one lender to see you as a good investment.  For this reason, borrowers interested in refinancing should check out rates with at least 3 or 4 of the many student loan refinance companies.

Will Navient Make Refinancing Difficult?

Jaded borrowers might suspect that Navient will try to make the refinance process as difficult as possible.  The good news is that there is very little Navient can do to stand in the way.  Most refinance lenders handle the payoffs to old lenders so that the borrowers have to do very little.

In short, when you refinance, dealing with Navient becomes your new lender’s problem.

Does Navient Refinance Student Loans?

Navient only handles private loans and federal loan servicing.  They do not refinance any existing student loans.

Even though Navient refuses to refinance student loans, many other companies do offer this service.  Further, Navient cannot prevent you from refinancing your student loans elsewhere.

Bottom Line

Dealing with Navient can be a headache.  For some borrowers refinancing can bring an end to dealing with Navient.  This financial move can save a small fortune in interest and get student loans paid off much faster.  However, a student loan refinance only makes sense in certain circumstances.  Borrowers need to carefully evaluate their options before making the plunge.  Once a loan is refinanced, there is no going back.