College Students and Recent Grads, Pay Down My Debt

19 Options to Refinance Student Loans – Get Your Lowest Rate

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19 Options to Refinance Student Loans - Get Your Lowest Rate

Updated: September 27, 2016

Are you tired of paying a high interest rate on your student loan debt? Are you looking for ways to refinance your student loans at a lower interest rate, but don’t know where to turn? We have created the most complete list of lenders currently willing to refinance student loan debt.

You should always shop around for the best rate. Don’t worry about the impact on your credit score of applying to multiple lenders: so long as you complete all of your applications within 14 days, it will only count as one inquiry on your credit score. You can see the full list of 19+ lenders below, but we recommend you start here, and check rates from the top 4 national lenders offering the lowest interest rates. We update this list daily:

LenderTransparency ScoreMax TermFixed APRVariable APRMax Loan Amount 



3.50% - 7.74%

Fixed Rate

2.22% - 6.02%

Variable Rate

No Max

Max Loan



3.50% - 7.45%

Fixed Rate

2.22% - 5.82%

Variable Rate

No Max

Max Loan



3.50% - 7.74%

Fixed Rate

2.22% - 6.02%

Variable Rate

No Max

Max Loan



3.25% - 8.22%

Fixed Rate

2.22% - 6.92%

Variable Rate

$125k / $175k

Max Loan

We have also created:

But before you refinance, read on to see if you are ready to refinance your student loans.

Can I Get Approved?

Loan approval rules vary by lender. However, all of the lenders will want:

  • Proof that you can afford your payments. That means you have a job with income that is sufficient to cover your student loans and all of your other expenses.
  • Proof that you are a responsible borrower, with a demonstrated record of on-time payments. For some lenders, that means that they use the traditional FICO, requiring a good score. For other lenders, they may just have some basic rules, like no missed payments, or a certain number of on-time payments required to prove that you are responsible.

If you are in financial difficulty and can’t afford your monthly payments, a refinance is not the solution. Instead, you should look at options to avoid a default on student loan debt.

This is particularly important if you have Federal loans.

Don’t refinance Federal loans unless you are very comfortable with your ability to repay. Think hard about the chances you won’t be able to make payments for a few months. Once you refinance, you may lose flexible Federal payment options that can help you if you genuinely can’t afford the payments you have today. Check the Federal loan repayment estimator to make sure you see all the Federal options you have right now.

If you can afford your monthly payment, but you have been a sloppy payer, then you will likely need to demonstrate responsibility before applying for a refinance.

But, if you can afford your current monthly payment and have been responsible with those payments, then a refinance could be possible and help you pay the debt off sooner.

Is it worth it? 

Like any form of debt, your goal with a student loan should be to pay as low an interest rate as possible. Other than a mortgage, you will likely never have a debt as large as your student loan.

If you are able to reduce the interest rate by re-financing, then you should consider the transaction. However, make sure you include the following in any decision:

Is there an origination fee?

Many lenders have no fee, which is great news. If there is an origination fee, you need to make sure that it is worth paying. If you plan on paying off your loan very quickly, then you may not want to pay a fee. But, if you are going to be paying your loan for a long time, a fee may be worth paying.

Is the interest rate fixed or variable?

Variable interest rates will almost always be lower than fixed interest rates. But there is a reason: you end up taking all of the interest rate risk. We are currently at all-time low interest rates. So, we know that interest rates will go up, we just don’t know when.

This is a judgment call. Just remember, when rates go up, so do your payments. And, in a higher rate environment, you will not be able to refinance to a better option (because all rates will be going up).

We typically recommend fixing the rate as much as possible, unless you know that you can pay off your debt during a short time period. If you think it will take you 20 years to pay off your loan, you don’t want to bet on the next 20 years of interest rates. But, if you think you will pay it off in five years, you may want to take the bet. Some providers with variable rates will cap them, which can help temper some of the risk.

Places to Consider a Refinance

If you go to other sites they may claim to compare several student loan offers in one step. Just beware that they might only show you deals that pay them a referral fee, so you could miss out on lenders ready to give you better terms. Below is what we believe is the most comprehensive list of current student loan refinancing lenders.

You should take the time to shop around. FICO says there is little to no impact on your credit score for rate shopping as many providers as you’d like in a single shopping period (which can be between 14-30 days, depending upon the version of FICO). So set aside a day and apply to as many as you feel comfortable with to get a sense of who is ready to give you the best terms.

Here are more details on the 5 lenders offering the lowest interest rates:

1. SoFi*: Variable Rates from 2.22% and Fixed Rates from 3.50% (with AutoPay)

sofiSoFi (read our full SoFi review) was one of the first lenders to start offering student loan refinancing products. More MagnifyMoney readers have chosen SoFi than any other lender. Although SoFi initially targeted a very select group of universities (it started with Stanford), now almost anyone can apply, including if you graduated from a trade school. The only requirement is that you graduated from a Title IV school. You need to have a degree, a good job and good income in order to  qualify. SoFi wants to be more than just a lender. If you lose your job, SoFi will  help you find a new one. If you need a mortgage for a first home, they are there  to help. And, surprisingly, they also want to get you a date. SoFi is famous for  hosting parties for customers across the country, and creating a dating app to  match borrowers with each other.

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2. Earnest*: Variable Rates from 2.22% and Fixed Rates from 3.50% (with AutoPay)

EarnestEarnest (read our full Earnest review) offers fixed interest rates starting at 3.50% and variable rates starting at 2.20%. Unlike any of the other lenders, you can switch between fixed and variable rates throughout the life of your loan. You can do that one time every six months until the loan is paid off. That means you can take advantage of the low variable interest rates now, and then lock in a higher fixed rate later. You can choose your own monthly payment, based upon what you can afford (to the penny). Earnest also offers bi-weekly payments and “skip a payment” if you run into difficulty.

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3. CommonBond*: Variable Rates from 2.22% and Fixed Rates from 3.50% (with AutoPay)

CommonBondCommonBond (read our full CommonBond review) started out lending exclusively to graduate students. They initially targeted doctors with more than $100,000 of debt. Over time, CommonBond has expanded and now offers student loan refinancing options to graduates of almost any university (graduate and undergraduate). In addition (and we think this is pretty cool), CommonBond will fund the education of someone in need in an emerging market for every loan that closes. So not only will you save money, but someone in need will get access to an education.

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4. LendKey*: Variable Rates from 2.22% and Fixed Rates from 3.25% (with AutoPay)

lendkeyLendKey (read our full LendKey review) works with community banks and credit unions across the country. Although you apply with LendKey, your loan will be with a community bank. If you like the idea of working with a credit union or community bank, LendKey could be a great option. Over the past year, LendKey has become increasingly competitive on pricing, and frequently has a better rate than some of the more famous marketplace lenders.

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In addition to the Top 4 (ranked by interest rate), there are many more lenders offering to refinance student loans. Below is a listing of all providers we have found so far. This list includes credit unions that may have limited membership. We will continue to update this list as we find more lenders. This list is ordered alphabetically:

  • Alliant Credit Union: In order to qualify, you need to have a bachelor’s degree. The minimum credit score is 680, and you need two years of employment and a minimum income of $40,000. Interest rates start as low as 3.75%. Anyone can join this credit union by making a $10 donation to Foster Care for Success.
  • Citizens Bank: To get the best deal, you should have at least a bachelor’s degree. They will look at your credit history, and want to make sure that at least the last three payments on your student loans have been made on time. If you don’t have your degree, you need to have made the last 12 payments (principal and interest) on time. You must make at least $24,000 per year. They offer fixed rates starting at 4.74% and variable rates start from 2.19%.
  • College Avenue: College Avenue offers fixed rates starting at 4.74% and variable at 2.50%, and only offers 15 year terms.
  • CommonWealth One Federal Credit Union: Variable interest rates start at 3.36%. You can borrow up to $75,000 and need to be a member of the credit union in order to qualify.
  • Credit Union Student Choice: This is a tool offered by credit unions. The criteria and pricing vary by credit union. The credit unions have restricted membership, but you can find out if you qualify on this site.
  • DRB Student Loan*: They will refinance undergraduate, Parent PLUS and graduate loans including MBA, Law, Medical/Dental (Post Residency), Physician Assistant, Advanced Degree Nursing, Anesthetist, Pharmacist, Engineering, Computer Science and more degrees. Variable rates as low as 3.64% and 4.20% fixed.
  • Eastman Credit Union: They don’t share much of their criteria publicly. Fixed rates start at 6.5% and you must be a member of the credit union. Credit union membership is not available to everyone.
  • Education Success Loans: You must be out of school for at least 30 months, and you must have a degree. You also need a good credit score, with on-time payment behavior. Variable and fixed loan options are available, with rates starting at 4.99%.
  • EdVest: They offer refinancing options for private loans used to finance attendance at a Title IV, degree-granting institution. If the loan balance is below $100,000 you need to make at least $30,000 a year. If your balance is above $100,000 you need to make at least $50,000. Variable rates start at 3.180%, and fixed rates start at 4.740%.
  • First Republic Eagle Gold. It’s hard to beat these rates – starting at 1.95% fixed and 1.87% variable. But you need to go in person to a First Republic branch to complete your account opening. They are located in San Francisco, Palo Alto, Los Angeles, Santa Barbara, Newport Beach, San Diego, Portland (Oregon), Boston, Palm Beach (Florida), Greenwich, and New York City. Loans must be $60,000 – $300,000 and you need a 750 or higher credit score with 24 months experience in your current industry.
  • IHelp: This service will find a community bank. Community banks can actually be expensive. You need to have 2 years of good credit history, with a DTI (debt-to-income) of less than 45% and annual income of at least $24,000. Fixed rates are available, starting at 4.65% fixed, and 3.21% variable.
  • Mayo Employees Credit Union: You need at least $2,000 of monthly income and a good credit history. Variable rates are available, starting at 5.15% and you would need to join the credit union.
  • Navy Federal Credit Union: This credit union offers limited membership. For men and women who serve, the credit union can offer excellent rates and specialized underwriting. Variable interest rates start at 2.89%.
  • RISLA: You need at least a 680 credit score, and can find fixed interest rates starting at 4.49% if you use a co-signer.
  • UW Credit Union: $25,000 minimum income required, with at least 5 years of credit history and a good repayment record. Fixed and variable interest rates are available, with variable rates starting at 2.23% and fixed rates starting at 4.04%. You need to join the credit union in order to refinance your loans.
  • Wells Fargo: As a traditional lender, Wells Fargo will look at credit score and debt burden. They offer both fixed and variable loans, with variable rates starting at 3.74% and fixed rates starting at 6.24%. Wells Fargo does not have a tradition of being a low cost lender.

You can also compare all of these loan options in one chart with our comparison tool. It lists the rates, loan amounts, and kinds of loans each lender is willing to refinance. You can also email us with any questions at

Don’t forget to follow us on Twitter @Magnify_Money and on Facebook.

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College Students and Recent Grads

Does a Tuition Installment Plan Make Sense for You?

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college students Teenagers Young Team Together Cheerful Concept

If you’re a student who is short on cash, but you want to avoid student loans, you might be considering a tuition installment plan, but before you enroll, read the plan agreement and do a bit of math. In most cases, the tuition installment plan is a bad deal for you.

What is a tuition installment plan?

A tuition installment plan allows you to pay your tuition in monthly payments that last twelve months or less (sometimes as few as three installments). You can expect to pay an enrollment fee, but you won’t pay interest. Universities limit the amount of money you can pay through tuition installment plans, so the remainder of your tuition bill needs to be covered in cash or by student loans.

What are the installment plan fees?

Enrollment fees vary by university, but you can expect to pay anywhere from $25-$100 to enroll in a tuition payment plan. For example, Virginia Commonwealth University charges a nonrefundable $25 application fee to enroll in the tuition installment plan, while Howard University charges a $45 fee, and Rutgers charges a $60 fee for an annual plan or $50 per semester. If you pay your installment late or incompletely, you can expect to pay a late fee of $10-$35 per installment.

What happens if I don’t pay?

If you don’t pay your installment payments, the university will roll your payments into an “emergency” loan where interest begins accruing immediately, and payments are immediately due. You may be able to take out student loans to pay off the emergency loan, but you may be stuck with the loan going forward.

Once your tuition installment plan converts to a loan, creditors view it like any other loan. This means that failing to pay it will lead to credit problems. Additionally, your school may put a hold on your credentials or not allow you to enroll in classes until the loan is current.

Information about what happens if you don’t pay will be available in an agreement that you need to sign prior to enrollment. Read the agreement prior to enrolling in a tuition installment plan.

Will Tuition Installment Plans save you money?

You won’t save much money paying through a tuition installment plan compared with subsidized student loans. Sallie Mae offers a calculator that calculates the amount of interest you will accrue on a student loan if the loan goes completely unpaid. Compare the accrued interest to the the tuition installment plan enrollment fee to see if you have the potential to save money.

Tuition installment plans sound like interest free loans, but they tend to be a bad deal for students. You’re locked into payments during school, and you save little (or nothing) compared to subsidized student loans. Since enrolling in tuition installment plans requires filling out a FAFSA, you won’t save time enrolling in TIP(s) vs taking out loans.

When should I consider Tuition Installment Plans?

Tuition installment plans have a useful psychological value. If a required payment keeps you from wasting money or from taking on debt for lifestyle purchases, then you should consider it whether or not you save money compared to student loans. If you have a moral or religious objection to debt, installment plans allow you to cover a small gap without interest bearing debt (but be aware that if you fail to pay, you’re taking on a loan).


College Students and Recent Grads, Pay Down My Debt

How This California Couple Paid Off $100,000 of Debt in 2 Years

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Student Loan Debt
Illustration by Kelsey Wroten

When 31-year-old Priscilla Jones completed her MFA in film in 2011, she was left with a total of $96,000 of student loan debt from both her undergraduate and graduate studies. (She requested that we change her name for privacy reasons). Over the next three years, thanks to compounding interest charges, the original amount ballooned to $118,000. On her current payment plan, it would take another 15 years to pay off all her debt.

Rather than dragging the process out, she and her husband (we’ll call him Nathan), decided to aggressively pay down her debt. Over the next 22 months, they paid off $100,000 of the original loan balance — all while raising a young child in Los Angeles.

Here’s how they did it:

Making a pact

While Nathan, 41, was fully aware of Priscilla’s debt load when they got married in 2011, it wasn’t until 2014 — on Valentine’s Day, to be exact — when the couple opened the hood on Priscilla’s student loans to uncover what was lurking underneath.

“For the first few years of our marriage, we just couldn’t afford to buckle down to pay them off, so we didn’t really take a close look,” says Nathan.

The catalyst for examining Priscilla’s loans? In less than two months, one of the largest loans Priscilla carried — a total of $88,000 — would come out of forbearance. The additional loan payment would triple their monthly bill from $300 to $900. Two weeks later, they decided to dump their savings accounts, putting $24,000 toward her largest debt.

And then they made a pact: They would do everything they could to pay off the loans within three years.

Working overtime

On top of working a full-time job in operations at a tech startup, Priscilla took side jobs, working an additional 20 to 30 hours a week. She kept $600 a month from her salary for personal spending and used the rest to pay off her student loans. She and Nathan made sure to keep $5,000 to $10,000 in an emergency fund at all times.

Bonuses and promotions

They lived off of Nathan’s salary in management at a tech startup, and Nathan’s work bonuses went straight toward paying off the debt. When Nathan started his current job in 2012, he earned $53,000, including bonuses. His company soon saw tremendous growth. As a result, Nathan quickly ascended the ranks, and his income spiked dramatically. The couple’s combined salary in 2014 was $170k and $160k in 2015, and every penny they could pinch went toward their debt load.

“We think of ourselves as being very fortunate,” says Nathan. “But even if my income hadn’t grown as it did, we would’ve used the same mindset and tactics to pay off our loans. Instead of it taking three years, it would’ve taken 10.”

Never ‘act your wage’

Although they were in a high income bracket, no one would have guessed as much by looking at their spending habits. They lived as frugally as possible to focus on paying off the student loans. They stayed in the two-bedroom, two-bathroom apartment in Venice that Nathan had locked down at a low rate during the recession. They drove two beat-up cars that were paid off in full and had good gas mileage.

“We really had to examine our needs versus wants,” says Priscilla. While they’ve never been big spenders, and value community and experiences, they had to put some of their wants on hold. For instance, Nathan, who loves to invest, contributed just the minimum toward his employer’s 401(k) to qualify for the full matching contribution. Priscilla curbed any frivolous spending on clothes. They also put off getting new carpet and furniture, both of which needed desperately to be replaced.

They shopped at the Dollar Store, didn’t buy clothes that required dry cleaning, and refrained from traveling for pleasure. They paid as many bills as they could on their credit cards, which were paid in full each month. Any reward points they racked up went toward gift cards for restaurants and movies. A rare dinner out would be at El Pollo Loco or In-N-Out Burger.

“We turned it into a game, and had fun with it,” explains Priscilla. For instance, the couple placed a chalkboard in their kitchen and wrote on it the outstanding debt amounts and interest rates, along with specific dates for hitting their goals.

The ‘avalanche’ method

To prioritize which debts would be paid off first, they decided to use the ‘debt avalanche’ method. They aggressively knocked off the loan with the highest interest rate first, then worked their way down. They would challenge each other to save as much as they could toward paying off the loan. “Working together to pay off debt helped us bond,” adds Nathan.

“To stay motivated, we would obsessively calculate how much interest we were paying each day,” says Priscilla. “At one point we were paying $37 a day in interest alone.”

Taking time to celebrate

When they reached a debt payoff total of $100,000 in February 2015, they decided to ease up on their loan repayments. To celebrate, they rented a limo and had a night out on the town. They also finally were able to give their apartment a facelift. “We no longer have to move furniture around to hide the holes in the carpet anymore,” Priscilla says.

In September of this year, the couple made their final loan repayment and are completely debt- free.

They say that it’s essential to maintain perspective when paying off student debt.
“Remember, you’re not dying,” Nathan says. “Just focus on paying it off, and your debt will get crushed.”


College Students and Recent Grads, Reviews, Student Loan ReFi

LendKey Student Loan Refinance Review

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

LendKey Student Loan Refinance Review

Updated September 7, 2016

Could you imagine trying to find the best student loan refinancing rate from community banks and credit unions on your own? How would you do it? Would you call every bank and credit union and ask for help? What a nightmare.

LendKey has relationships with 300+ community banks and credit unions all over the United States. LendKey* can issue loans to residents in any of the 50 states. This keeps you from having to pound the pavement by your lonesome. LendKey’s website will show you the best rate for refinancing your student loans.

Since 2007, LendKey has been a one stop shop for student loan refinancing. It also offers other types of loans. But for the sake of this review we’ll be focusing on how LendKey takes care of graduates looking to improve their debt situation. Fixed APRs range from 3.25% – 8.22%. Variable rates start as low as 2.22%.

Who can benefit from using LendKey? Anyone hoping to refinance their student loans should consider LendKey. It is easy to apply:


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If you’re on the fence about refinancing, here are some of the benefits to be gained:

Lower Payments

Refinance your way to a more manageable monthly payment.

Lower Rates

Spend less on interest by getting a lower rate than the aggregate of all individual student loans.

Simplified Finances

Making payments on multiple loans to multiple institutions at different times of the month can be quite the hassle. It’s much easier to remember just one payment. Many lenders even let you consolidate both private and federal loans.

Different Repayment Options

Different lenders offer different repayment options. It’s wise to explore all the options to determine what makes the most sense for your particular situation.

Pros of Using LendKey

A Unified Application Process

This is hugely important. With LendKey, you’re not shuffled through tons of screens on different domains – all using different logons and different (confusing!) user interfaces. Within 5 minutes, a person can navigate through LendKey’s application process. This means after 5 minutes, you can see how much you can save by refinancing. You can even choose what loan you want.

Cosigner Release Available

Yes, you can secure a low interest rate and then cut loose your cosigner. Once you prove you are responsible – LendKey no longer needs a cosigner tied to your account. This may help convince a cosigner to work with you initially. They won’t need to be on the hook for long. Once you’ve made 12 full and consecutive on-time payments, your cosigner may be released. LendKey does a credit check and examines your income to see if you are free to go it alone.

No Origination Fee

This is helpful since it means you are free to shop around without feeling committed.

Further Interest Rate Reduction

1% interest rate reduction once 10% of the loan principal is repaid during the full repayment period. This is subject to the floor rate.

0.25% ACH Interest Rate Reduction

Many lenders reduce interest rates by a quarter percent for borrowers who agree to automatic payments.

Federal and Private Loans Can Be Consolidated Together

However, you lose some federal benefits in doing so. Things like free insurance (provided with federal loans if you are killed or severely disabled), public service forgiveness and military service forgiveness as well as income-based repayment plans. Grace periods will likely be omitted when writing the new consolidated loan.

Over 40,000 Borrowers Serviced

As of January 2016, 40,000 people have used LendKey’s services.

Excellent Customer Support

According to cuStudentLoans (which LendKey owns so take this with a grain of salt), 97% of customers are satisfied. Customer support comes out of New York and Ohio. Phone support is available each day from 9AM to 8PM EST.

For what it’s worth, I called into support 5 times at random. The support I received from the sales team was really great. Even the gentleman with only 6 months of experience was quite knowledgeable.

Eligible Schools

This list of eligible schools is 2,200 and growing. Chances are your school is on the list. However, LendKey doesn’t encourage students to submit eligibility requests as other student loan refinancers do.

Return Policy

Yes, you can ‘return’ your loan. LendKey offers a 30 day no-fee return policy to allow you to cancel the loan within 30 days of disbursement without fees or interest. That’s pretty incredible.


LendKey Doesn’t Give You the Complete Picture

LendKey doesn’t help a lot with stacking institutions against each other. I suppose this is meant to not to play favorites. However, it would be nice to be able to read about each institution within the LendKey interface. I’d still advise opening up another tab to research the banks you are considering.

The Fine Print You May Miss

Since LendKey is a loan matchmaker, there isn’t a lot of fine print on the site. This means a person still needs to review the fine print of each institution before finalizing his or her loan as mentioned before. LendKey does a fantastic job of getting you 90% of the way. But that last 10% of fine print is between you and your lending institution. Read through everything before signing up for a new loan.

I read the Better Business Bureau complaint log for LendKey. There are only 11 complaints in the past 3 years. SoFi (a competitor) has 18 and another competitor, Earnest, has no complaints. These complaints were mostly small misunderstandings between the LendKey support team and the borrowers.

The Application Process

There are four steps to the simple application process. Step 1 is for estimating monthly payments for a private student loan. It’s simple. You identify the amount you’d like to borrow and fill in a radio button indicating your credit is fair, good, or excellent. The last part is where you enter which state you live in. This is because many programs are state specific. Step 1 takes 1 minute.

Step 2 takes 2 minutes. This is the step where you compare the rates and offers available to you. Choose what works best for your unique situation.

Step 3 again only takes 1 minute. This is the actual application. As mentioned earlier in this article, this process is done through the LendKey interface. And don’t worry, information inputted into LendKey is safe (privacy policy).

Step 4 takes 10 minutes. This is the step where a person verifies identity, school, and income (screenshots/pictures work so there’s no hassle with scanning!). You will know if you are approved during this step.

As with any company, there are competitors. Here are two worthy rivals also worth considering:

Alternatives to LendKey


SoFi stands out with a job placement programs, free wealth management for borrowers and even a dating app. More importantly, SoFi has low interest rates, with variable rates starting at 2.22% and fixed rates starting at 3.50%.

SoFi logo

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If you have a low credit score but have potential to earn a good income, Earnest will treat you well. Earnest looks beyond a simple credit score. The application process examines employment history, future earning potential and overall financial situation.

Earnest seems to take a very personal approach to each customer. A customer states an amount they can pay each month and Earnest will give them a loan, accordingly. Earnest also lets borrowers skip a payment each year. This could come in handy if money gets tight around the holidays. Just keep in mind, this can increase your future payments to compensate for the missed on.

Fixed interest rates start at 3.50% and variable interest rates start at 2.22%.

However, Earnest isn’t available for all US residents.


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Final Thoughts

LendKey runs a fantastic student loan refinancing division. The company offers many, many customizable options with very few downsides. With no application fee, it’s worth seeing what this student loan refinancing powerhouse can do for you.


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College Students and Recent Grads, Pay Down My Debt, Reviews

CommonBond Student Loan Refinance Loan Review

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

CommonBond Grad Student Loan Refinance Loan Review

Updated September 7, 2016

CommonBond was founded by three Wharton MBAs who felt the sting of student loans after they graduated. The founders decided to provide a better solution for graduates, as they thought the student loan system was broken and in need of reform. As a result, they strive to make the refinance (and borrowing) process as simple and straightforward for graduates as possible.

CommonBond* began by servicing students from just one school, and has rapidly expanded. Today, CommonBond loans are available to graduates of over 2,000 schools nationwide. Although the business started servicing only students with graduate degrees, today CommonBond is also available to refinance undergraduate degrees as well.

As you might be able to tell by the name, CommonBond thinks of its community as family. There is a network of alumni and professionals within the community that want to help borrowers. This alone sets it apart from other lenders, as members often meet for events.

While these are all great things, we know you’re more interested in how CommonBond might be able to help you make your student loans more affordable. Let’s take a look at what terms and rates they offer, eligibility requirements, and how they compare against other lenders.

Refinance Terms Offered

CommonBond offers low variable and fixed rate loans. Variable rates range from 2.22% – 6.02% APR, and fixed rates range from 3.50% – 7.74% APR.

Note that these rates take a 0.25% auto pay discount into consideration.

There is no maximum loan amount. CommonBond will lend what you can afford to repay. CommonBond offers fixed and variable rates with terms of 5, 10, 15, and 20 years.

The hybrid loan is only offered on a 10 year term – the first 5 years will have a fixed rate, and the 5 years after that will have a variable rate.

CommonBond has a great chart listing repayment examples based off of borrowing $10,000, which can be found on its rates and terms page.

To pull an example from that, if you borrow $10,000 at a fixed 4.74% APR on a 10 year term, your monthly payment will be $104.80. The total amount you will pay over the 10 year period will be $12,575.90.

The Pros and Cons

CommonBond is available to graduates of 2,000 universities. While that is a very long list, not all colleges and universities are included.

One pro to consider is the hybrid loan option available. It might seem a little confusing at first – why would someone want a variable rate down the road?

If you’re confident you’ll be able to make extra payments on your loan and pay it off before the 5 years are up, you might be better off going with the hybrid option (if you can get a better interest rate on it).

This is because you’ll end up paying less over the life of the loan with a lower interest rate. If you were offered a 10 year loan with a fixed rate of 6.49% APR, and a hybrid loan with a beginning rate of 5.64%, the hybrid option would be the better deal if you’re intent on paying it off quickly.

What You Need to Qualify

CommonBond doesn’t list many eligibility requirements on its website, aside from the following:

  • You must be a U.S. citizen or permanent resident
  • You must have graduated

CommonBond doesn’t specify a minimum credit score needed, but based on the requirements of other lenders, we recommend having a score of 660+, though you should be aiming for 700+. The good news is CommonBond lets you apply with a cosigner in case your credit isn’t good enough.

Documents and Information Needed to Apply

CommonBond’s application process is very simple – it says it takes as little as 2 minutes to complete. Initially, you’ll be asked for basic information such as your name, address, and school.

Once you complete this part, CommonBond will perform a soft credit pull to estimate your rates and terms.

If you want to move forward with the rates and terms offered, you’ll be required to submit documentation and a hard credit inquiry will be conducted. CommonBond lists the following as required:

  • Pay stubs or tax returns (proof of employment)
  • Diploma or transcript (proof of graduation)
  • Student loan bank statement
  • ID, utility bills, lease agreement (proof of residency)

CommonBond also notes it can take up to 5 business days to verify documents submitted, so the loan doesn’t happen instantaneously.

Once your documents are approved, you electronically sign for the loan, and CommonBond will begin the process of paying off your previous lenders. It notes this can take up to two weeks from the time the loan is accepted.

Who Benefits the Most from Refinancing Student Loans with CommonBond?

Borrowers who are looking to refinance a large amount of student loan debt will benefit the most from refinancing with them.

Common Bond

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Keeping an Eye on the Fine Print

CommonBond does not have a prepayment penalty, and there are no origination fees nor application fees associated with refinancing.

As with other lenders, there is a late payment fee. This is 5% of the unpaid amount of the payment due, or $10, whichever is less.

If a payment fails to go through, you’ll be charged a $15 fee.

It’s also noted that failure to make payments may result in the loss of the 0.25% interest rate deduction from auto pay.

Transparency Score

Getting in touch with a representative is simple and there is a chat and call option right on the homepage. Some lenders have this hidden at the bottom, or they don’t offer a chat option at all.

CommonBond also lets borrowers know they can shop around within a 30 day period to lessen the impact on their credit.

It does not list its late fees on its website, unlike other lenders. However, after making a chat inquiry, the question was answered promptly.

CommonBond does offer a cosigner release and is ranked with a A+ transparency score.

Alternative Student Loan Refinancing Lenders

The student loan refinancing market continues to get more competitive, and it makes sense to shop around for the best deal.

One of the market leaders is SoFi. It’s always worth taking a look to see if SoFi* offers a better interest rate.

The two lenders are very similar – CommonBond offers “CommonBridge,” a service that helps you find a new job in the event you lose yours. SoFi offers a similar service called Unemployment Protection.

SoFi’s variable rates are currently 2.22% – 6.02% APR with autopay, and its fixed rates are currently 3.50% – 7.74% APR, which is in line with what CommonBond is offering.

SoFi also doesn’t have a limit on how much you can refinance with them.

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Another lender to consider is Earnest. There is no maximum loan amount, and Earnest has a very slick application process. Interest rates start as low as 2.22% (variable) and 3.50% (fixed).


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Lastly, you could check out LendKey. It offers student loan refinancing through credit unions and community banks, but only offers variable rates in most states and fixed rates in a select few. The maximum amount to refinance with an undergraduate degree is $125,000, and the maximum amount to refinance with a graduate degree is $175,000.

All three of these options provide forbearance in case of economic hardship and offer similar loan options (5, 10, 15 year terms).


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Don’t Forget to Shop Around

As CommonBond initially conducts a soft pull on your credit, you’re free to continue to shop around for the best rates if you’re not happy with the rates it can provide. As the lender states on its website, if you apply for loans within a 30 day period, your credit won’t be affected as much.

Since CommonBond does have strict underwriting criteria, you should continue to shop around and don’t be discouraged if you are not approved. The market continues to get more competitive, and a number of good options are out there.

Customize Your Student Loan Offers with MagnifyMoney Comparison Tool


*We’ll receive a referral fee if you click on offers with this symbol. This does not impact our rankings or recommendations. You can learn more about how our site is financed here.


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College Students and Recent Grads

8 Student Loan Repayment Options if You Join the Military

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Student Loan Repayment Options

Several military programs offer scholarships and grants in exchange for your prior military service, or a promise of service in the future. But, what if you already have a degree and are working to pay off your student loans? You may want to consider one of the military’s student loan repayment programs.

In 2013, CNN reported on Thomas McGregor, an attorney who enlisted in the Army to help pay off his $108,000 student loan debt. Between his income and a loan-assistance program, he was student loan free within four years.

Military service isn’t for everyone, and you should seriously consider the potential impact of signing up for a multi-year commitment. It was a good fit for McGregor, who decided to stay on after his three-year service ended. However, he was deployed to Iraq and Afghanistan, and some of his friends were injured or died in combat.

If you decide joining the military is a good choice for you and are paying down student loans, the loan assistance programs could guide your decision to choose one branch over another. While the different programs sometimes share similar names, the qualifications, requirements, and award amounts can vary from one branch’s program to another.

Make sure the loan-repayment guarantee is in your contract before enlisting and double-check your loan’s eligibility for repayment through the program. For example, a program may pay off some types of federal student loans, but not state or private loans. Restrictions also apply based on which position you enlist in, your length of service, and whether or not you have prior military experience. In some cases, the loan payments count as income for tax purposes.

The military’s loan repayment programs and offers can change based on government funding and a branch’s need for new recruits. You can find an overview of the programs below, and you should follow-up with a local recruiter to clarify specifics and find out whether or not you’ll qualify.

Air Force

  • JAG Corps Student Loan Repayment ProgramEligible attorneys can receive up to $65,000 in student loan repayments, payable over three years following the completion of your first year of service. The payments can go towards undergraduate, graduate, or law school loans and payments will go directly to your lender. If you stay on past four years, then you can qualify for a $60,000 in cash bonuses: $20,000 for two more years of service and another $40,000 for four more. That’s not specifically earmarked for your loans, but you can use them to pay off your debt. That would be $125,000 over 8 years, in addition to your salary and other benefits.


  • Healthcare Loan Repayment ProgramsThe Army offers special pay and incentives to doctors, nurses, dentists, veterinarians, psychologists, and other healthcare professionals. Depending on your profession and specialty, you may be eligible for up to $120,000 in student loan repayments over three years of active-duty service in addition to salary, bonuses and special pay. Reserve-duty servicemembers may receive up to $50,000 for three years of service for loans.
  • College Loan Repayment ProgramThe Army also offers some highly qualified Military Occupational Specialists (MOSs) student loan assistance if they enlist for at least three years of service. At the end of each of the three years, you’ll receive the greater of $1,500 or 33.33 percent of your outstanding principal loan balance, less taxes. There’s a maximum potential payout of $65,000.

Army National Guard and Reserves 

  • College Loan Repayment Program The Army National Guard and Army Reserves have similar student loan payments for some highly qualified Military Occupational Specialists (MOSs). You could receive the greater of $1,500 or 15 percent of your outstanding loan principal at the end of each year of service, up to a maximum of $20,000. To qualify, you must enlist and serve for at least six years. Parent PLUS loans can be covered. 

Coast Guard

  • College Student Pre-Commissioning Initiative Student Loan Repayment ProgramThe Coast Guard offers recent college graduates who are 19- to 27-year-olds up to $10,000 per year, for six years, in student loan aid. The program requires candidates to complete a series of trainings, including basic training and leadership training, and enlist for five years as a commissioned officer. There are some interesting catches: you can’t have more than two dependents and if you’re single, you can’t have sole or primary custody of dependents. Online degrees also don’t qualify.


  • Health Professions Loan Repayment ProgramThe Navy pays select health care professionals up to $40,000, minus approximately 25% for federal income tax, in student loan payments each year in exchange for agreeing to continue, or begin, active duty service. The hefty tax portion will be taken out prior to sending the payment along to your lender.
  • College Loan Repayment Program Pays up to $65,000 in student loan payments if you’re serving in your first enlistment.

National Guard

  • Student Loan Repayment ProgramYou could receive the greater of $500 or 15 percent of your initially disbursed loan amount each year, with a maximum $50,000 payout and minimum six-year service agreement. You must have at least one disbursed Title IV federal loan.

Public Service Loan Forgiveness

The Public Service Loan Forgiveness (PSLF) program isn’t military specific, instead it’s a federal loan-forgiveness program contingent on your employment with a qualified government or non-profit organization. Only federal student loan that are part of the Direct Loan program qualify for PSLF. However, you may be able to consolidate non-qualifying federal loans (such as a Perkins loan) into a qualified Direct Consolidation Loan.

With PSLF, your remaining loan balance will be forgiven after you make 120 qualifying monthly payments (10 years’ worth) while employed full-time. The 120 payments don’t need to be consecutive, and some, or all, of the employment, could be within the military. You currently won’t have to pay income taxes on the forgiven amount.

Additional Military Benefits

In addition to the loan repayment programs, your federal student loans may be eligible for a capped 6-percent interest rate during active duty, and up to five years of no interest if you’re serving in qualified hostile areas. You may also be able to postpone payments during active duty, but the loans will still accrue interest.

Bottom line

The military’s student loan forgiveness programs may be able to help repay your loans, but don’t take the decision to enlist lightly. Other employers offer loan repayment programs, and potentially less-dangerous jobs qualify for the PSLF. If you do decide to enlist, compare the loan repayment programs and be sure to get the loan repayment included in your contract.

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College Students and Recent Grads, Life Events

3 Big Money Mistakes Your Freshman is Likely to Make

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3 Big Money Mistakes Your Freshman is Likely to Make

College is a time for adventure, growth and learning, but it can also be a time for silly financial mistakes if your freshman isn’t careful. This will likely be the first time your kid is out in the world on her own, so it makes sense that she’ll want to try new things. But her actions might come with some serious and long-lasting financial consequences unless you can help point her in the right direction first.

Here are three mistakes college freshmen often make when it comes to their finances — and how you can help your child avoid them.

1. They choose a college without considering the price tag

While it’s true that going to a good college is important these days, that doesn’t necessarily mean that your kid needs to go to the most expensive college to score his dream job after school. If your kid has always dreamed of going to a specific, but expensive, school, sit down with him at least a year or two out of applying to talk about how he’ll pay for it. The U.S. government recently launched the College Scorecard, where you can easily search for a school and see how its students fare financially after graduation. It might change his mind if he sees most students graduate from his dream school with tons of student loan debt. If your kid is willing to be a little flexible, you might want to point him towards one of these 20 most rewarding colleges for student loan borrowers, which ranks the best schools for generating the highest income after accounting for loan expenses.

2. They apply for credit cards before they learn how to use them

Luckily it’s gotten much harder for banks and credit card companies to market credit cards to students on college campuses. But the temptation to apply for credit will still be there. The second your kid applies for a credit card, she starts building a credit history that will follow her for at least the next seven years. A smart way to give her experience with some supervision is to add her as an authorized user on your credit card account. You can keep track of her spending habits and she can start building credit while she’s still in school. But don’t just pay the bill off each month without question. Talk to her about her credit score, what a credit report is for and how interest works. If you think it’s a good idea for your kid to dip her toe into the credit card world independently, consider starting her out with one of these best credit card options for college students. 

3. They never learn how to budget

The road to financial security starts with one simple building block: a budget. Unfortunately, budgeting isn’t something that comes naturally to everyone — especially for college freshman who may be trying to balance a job, classes, parties, and outings with friends. While your college kid probably won’t have a ton of disposable income to work with, it’s still a good idea to talk to him ahead of time about how to set up a budget, even when it’s just a limited amount of money he’ll be dealing with. If they can stick to a budget, they can also avoid costly mistakes like overdrawing their bank account, which can lead to all kinds of painful fees. During that conversation you can discuss the importance of an emergency savings account (because even college kids need an emergency savings account), how to divvy up income into necessary expenses and fun money, as well as how, once he graduates, he’ll likely need to put some extra money aside for retirement savings, as well.


College Students and Recent Grads, Life Events

10 Financial Moves to Make Before Your Child Goes to College

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Every parent I’ve ever talked to wants to be able to support their child’s college education. After all, you want to give your child all the opportunity in the world, and that’s exactly what college represents. But it’s a big expense and it’s growing. So how can you prepare to cover your child’s education while still paying your bills and saving for your own future?

Here are 10 financial moves to make before your child goes to college that will help your entire family build a better financial future.

1. Remember: Sometimes your needs come first

As much as you want to provide for your child, it’s important to take a step back and make sure you are on solid financial footing first.

The truth is that there are many routes to both obtaining and paying for a college education, from loans, to scholarships, to work-study, to less expensive schools.

But there is only one route to you having a secure financial future: your savings.

Putting yourself first not only ensures that you’ll be able to support yourself later on, but it ensures that your children won’t have to support you. So before you commit tens, or even hundreds, of thousands of dollars to your child’s college education, make sure your own financial needs are on the right track.

2. Get to the real goal

College is the default path, and for good reason. On average people with a college degree earn almost twice as much as those without one and are much less likely to be unemployed.

But before you assume that your child needs to go to the most prestigious (and expensive) college possible, take some time to think about what the real goal is here and if your child would flourish in the traditional four-year college setting. Perhaps a trade or technical school is the better fit.

Talk to your spouse or partner about the kinds of opportunities you’d like to provide. And talk to your child about the opportunities she wants for herself.

Figure out what you’re really working towards before making a huge financial commitment.

3. Evaluate your options

Once you know what you’re working towards, you can start to look at the options available to you.

When it comes to evaluating different colleges, you can look at cost. You can look at specialized programs. You can look at location, opportunity to travel, access to merit-based scholarships, and any other factors that are important to you.

You can also look at alternatives like taking a gap year, traveling, starting a small business, going to trade school, or self-directed or online education.

It’s important to be realistic about what many employers value, which is certainly a college education. But it’s also worth keeping an open mind about what truly matters for your child’s specific goals and evaluating all of your options.

4. Estimate your ‘Expected Family Contribution’

As you investigate the college route, you can start to get a sense of your expected family contribution.

This is the amount you will be expected to contribute to your child’s college education, with the cost above that amount presumably being covered by financial aid (which includes student loans).

You can estimate your expected family contribution here.

5. Decide how much you’re willing to contribute

Your expected family contribution is one thing. Deciding how much you can and are willing to fund is another. And there are a few factors that should go into that decision.

The first is what you can afford to pay. This involves the work you did in Step 1 to evaluate your progress towards other financial goals, as well as a look at your budget to see whether there’s any room to shift things around.

The second is being clear about the things you are willing to fund. In addition to tuition, there are books, room and board, food, fraternity/sorority dues, and other discretionary living expenses. Have a conversation that includes your child about how much those things cost and whose responsibility each expense will be.

The third factor is what you expect your child to contribute, which we’ll get into next.

The goal here is to be realistic about what you can afford and to be clear about what’s expected from all parties.

6. Make sure your kid has skin in the game

Given that you’re talking about your child’s future, it’s not unreasonable to expect your child to help pay for it. In fact, doing so may give him more ownership over the decisions being made, which could lead to better results.

There are many different ways for your child to help financially, from working in the years leading up to school, to working part-time during school, to applying for scholarships and grants. You don’t have to put it all on them, but involving them in the process can be beneficial for everyone.

7. Create and implement a savings plan

With your funding targets in mind, you’re ready to start saving.

The younger your child is, and the more likely it is that he or she will attend a traditional college, the more helpful a dedicated college savings account will be. That’s because the tax-deferral those accounts offer will have longer to work their magic. But if you live in a state that offers an income tax deduction for contributions, they can be helpful even in the years right before college.

Here’s a list of the top 529 plans in the country to help you decide: The 5 Best 529 Savings Plans Anyone Can Use.

And don’t forget that a regular investment account can offer a lot of flexibility. The money can be used for college if necessary, or you can hold onto it and use it for other goals.

8. Get up to speed on student loans

Student loans will almost certainly be an option, and there’s a good chance that they’ll end up as part of your strategy. That’s not necessarily a bad thing either. The value of a good education can be incredibly high, and taking on some debt in order to make it happen can be a smart move.

They key is to make sure it’s done purposefully and with a strong understanding of the consequences. Far too many students are graduating with far more student loan debt than they should have ever taken on, largely because of a lack of knowledge about what they were getting into.

So take some time to learn about the pros and cons of the options available to you, and make a decision based on what you can afford and what your child truly needs in order to get the education she wants. This article will give you a good start: How to Handle Student Loans in 4 Easy Steps.

9. Apply for scholarships and grants

It takes some work, but you may find that your child can qualify for a significant amount of money in scholarships and grants. This can not only reduce your financial burden, but it can also be a great way for your child to help financially without having to come up with a large amount of savings.

Students can start applying for college scholarships can be as early as middle school. At the latest, start preparing for applications in the first year of high school.

Here’s a guide to help you get started: 6 Ways to Find College Scholarships.

10. Plan ahead for your new budget

No matter how much you save, college years can be tough on your budget. That’s especially true if you’ll have two or more children in college at the same time.

If you can, make your best guess at what your budget will look like during those years and start living on it a year ahead of time. That will not only help you get used to the budget, but it will allow you to build some extra savings to help smooth out any bumps in the road.


College Students and Recent Grads

Best Ways to Deal With Medical School Student Loan Debt

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Medical School Student Loan Debt

Graduating from medical school and becoming a doctor is a significant commitment for both your time and money. Nearly 80% of medical students graduate with over $100,000 in student loans from their premed and medical education, according to the Association of American Medical Colleges (AAMC). The median debt balance for medical school graduates in 2015 was $183,000. In comparison, the average Class of 2014 graduate left school with just $28,950 in student loan debt.

To put $183,000 of federal student loans into perspective, after 3 years of forbearance during residency, a medical professional would need to make payments of $2,700 per month under the 10-year Standard Repayment Plan to pay the debt off.

Although the medical field is one that may boast a handsome salary, it’s also a profession that can require 11 to 15 years of study in undergraduate school, medical school and residency before a doctor is qualified for a position that pays well enough to accommodate such a high monthly loan payment.

If you’re not sure how to tackle the mountain of debt from your medical school education, read on for a few ways to handle repayment.

Request Student Loan Forbearance During Residency

The median medical residency stipend was less than $60,000 per year in 2015 based on the AAMC survey. So delaying payment with a forbearance while in medical training (as shown in the example above) can give you some relief until you’re hired for a permanent position that pays well.

In most cases, offering forbearance is at the discretion of a lender. However, a lender is required to accept your request for forbearance during a medical residency if you meet certain qualifications.

To be eligible for mandatory forbearance, you must:

  • Be accepted to an internship/residency program that requires a bachelor’s degree
  • Receive supervised training during the internship/residency
  • Be enrolled in a program that will lead to a degree or certificate from an institution of higher education, a hospital, or a healthcare facility that offers postgraduate training, or
  • Be enrolled in a program that’s required to lead your own practice

One thing to keep in mind is during forbearance, interest still accrues and will add to your loan balance if left unpaid.

Be careful, interest can grow quickly. Making interest-only payments during residency is one way you can still be proactive about repaying your medical school debt during a temporary break from scheduled payments.

Get to Know the Perks of Your Federal Loans

Federal student loans come with perks including options for income-driven repayment, forgiveness and deferment. These benefits are usually not offered by private loan servicers. It’s a good idea to hold off on refinancing federal loans with a private lender until you decide if you want to use any of the benefits.

We’ll talk about student loan refinancing next. First, here are three major features of federal student loans you should know about that can help you:

Income-Driven Repayment Programs

There are four income-driven plans:

Income-driven plans put a cap on your monthly payment based on your current income and family size. As your income increases, your student loan payment increases as well to make the repayment process more manageable.

Each of the repayment plans have fairly similar terms. In general, the plans allow you to make payments of 10% to 20% of your discretionary income. After making payments for 20 to 25 years, the unpaid balance on your loan is forgiven.

Of all the plans, it’s most difficult to qualify for the IBR and PAYE plans. To qualify, the payment you would make on either the IBR or PAYE plan has to be less than the one you would make on the 10-year Standard Repayment Plan. (You can calculate payments for the Standard Repayment Plan vs. the IBR and PAYE plans with this calculator.)

In addition, for the PAYE plan you have to be a new borrower meaning your Direct Loan was disbursed on or after October 1, 2011. There’s a little less fine print on the ICR and REPAYE plans. You can find out if you qualify for one of these income-driven repayment programs here.

Using one of these income-driven repayment plans may be a better method of managing payments than forbearance during your medical residency or internship. As we mentioned previously, interest still accrues while your loans are in forbearance, which means your total balance will grow during that period. Even small payments through an income-driven plan can give you a jump-start on repaying your debt.

However, as a long-term solution, income-driven repayment plans have a major drawback. These plans extend the number of months it’ll take you to pay off your loans thus increasing the amount of interest you pay over time. Even if you hold out for 20 to 25 years to take advantage of loan forgiveness, having a large amount of debt with growing interest tagging along with you for a good portion of your career may impact your ability to reach other financial goals. Make sure you understand these implications before you prolong repaying your debt.

Public Service Loan Forgiveness (PSLF)

One instance where sticking with an income-driven payment plan can pay off is if you also participate in Public Service Loan Forgiveness. After you make 120 monthly student loan payments on an income-driven repayment plan while working full-time in public service, the remaining balance can be forgiven. This works out to be 10 years.

Employers you can work for to obtain Public Service Loan Forgiveness include:

  • Government agencies (including federal, state, local agencies, or entities)
  • Non-profit, tax-exempt organizations
  • AmeriCorps
  • Peace Corps
  • Private, non-profit organizations that provide:
    • Emergency management
    • Military service
    • Public safety
    • Early childhood education (including licensed or regulated health care)
    • Public service for individuals with disabilities and the elderly
    • Public health including nurses, nurse practitioners and full-time healthcare professionals

Labor unions, partisan political organizations, for-profit organizations and nonprofit organizations that are not tax-exempt will not qualify for PSLF.

You must also work full-time to be eligible which is at least 30 hours a week. All Direct Loans can be forgiven including Direct PLUS loans for parents. But, the parent has to be the one working in public service, not the graduate for their loans to be forgiven. You can learn more about the program here.

Temporary Deferment

Deferment may be a last resort option for federal student loans if you experience financial hardship or unemployment and need a solution sooner than later. Deferment is similar to forbearance and puts a temporary hold on your payments. However, when you defer a subsidized loan, you may get a break from paying your principal and the government may cover the interest for you.

Keep in mind, this is just a temporary solution. During deferment, you should develop a long-term strategy for repaying your student loan debt.

Refinance Private Student Loans (and Maybe Your Federal Ones)

If you’re locked into a private student loan with high or variable interest, refinancing is a way to lower your interest rate and potentially save yourself thousands of dollars through the life of your loan.

Refinancing your federal loans with a private lender will mean forfeiting those flexible repayment options we talked about before (PAYE, IRB, etc.). That’s because you are taking out a new private loan to pay off your federal loans. Choosing whether or not to refinance your federal loans isn’t a decision you should take lightly.

If you’re experiencing financial uncertainty or considering public service for loan forgiveness, stick with your federal student loans — at least for now. You are more likely to need the extra flexibility of those federal repayment options. If you have a stable job, high credit score, high income and predict continued financial security, forfeiting the benefits of your federal loans with a refinance is an option worth weighing.

Out of all of the federal student loans, the loans for graduate level studies have the highest interest rates and may be the best candidates for a refinance. Two other variables besides interest that will impact what you’ll save from refinancing are the loan term and payment schedule. Make sure you dig into each of these details to choose the loan that’ll save you the most.

Two examples of student loans are offered by SoFi and CommonBond.

  • SoFi provides student loan refinances with variable and fixed interest. Fixed interest rates range from 3.50% to 7.74% APR depending on your loan term. Variable rates start as low as 2.22%.
  • CommonBond is another student loan refinance provider with fixed interest from 3.50% to 7.74% APR depending on your loan term. Variable rates start as low as 2.22%.

Check for State Run Loan Repayment Programs

Some states are willing to offer student loan repayment programs to attract young new medical talent.

The Health Resources and Services Administration (HRSA) provides a federally-funded grant to states that operate State Loan Repayment Programs (SLRPs) for professionals in medical fields.

The purpose of this repayment program is to give loan assistance to health care providers that work in areas where there’s a shortage of health professionals. The type of work you have to do, time commitment and amount you’ll be awarded varies by state.

For example, in California, primary care, behavioral health, pharmacist and dental professionals may be granted up to $50,000 in exchange for 2 consecutive years of service.

In Oregon, primary care physicians, nurse practitioners, physician’s assistants, dentists, dental hygienists, social workers, counselors and psychologists can receive up to $35,000 per year. The commitment is 2 years of service.

Don’t expect to get free money without having to make a few promises in return. Many programs require workers to make a serious commitment to work there. For additional program details, check out this roundup of Loan Repayment Programs by state.

Research Other Service-Based Repayment Opportunities

In addition to the state programs, there more federally-funded service-based loan repayment opportunities that you may qualify to participate in.

Students to Service Loan Repayment Program

This program is for medical or dental students that are in their final year at an accredited medical school. (If you’ve already graduated, skip to the next opportunity). The National Health Service Corps (NHSC) provides the Student to Service Loan Repayment Program for students in their final year of school who commit to at least three years of primary care work in an underserved community or six years of half-time work after primary care residency. You can be awarded up to $120,000 tax-free. Funds are paid out annually in installments.


  • Enrolled, full-time student in the final year of medical school
  • Attending a fully accredited school and earning an eligible degree for the program
  • Will complete an accredited primary medical care residency in either:
    • Internal medicine
    • Family practice
    • Pediatrics
    • Obstetrics/gynecology
    • Geriatrics
    • Psychiatry

The NHSC may prioritize applicants who come from a disadvantaged background as determined by being identified as having a “disadvantaged background” due to environmental and/or economic factors by your school or you received a Federal Exceptional Financial Needs Scholarship. Priority will also be given to those who display what the NHSC defines as characteristics that indicate you’re more likely to continue working in a disadvantaged area after your service is complete. You can learn more here.

National Health Service Corps Loan Repayment Program

For practicing primary care, dental and mental health professionals, the National Health Service Corps (NHSC) offers up to $50,000 in exchange for a two-year commitment in an underserved area. You can find eligible underserved areas with open positions here. The funds for repayment of your student loans in this program are also income tax-free.

You can work full-time or part-time, but your hours will impact how much you’re rewarded for repayment. If you want to earn more to repay student loans, you can extend your time in the program beyond two years.


  • Must be a U.S. citizens or U.S. national
  • Be eligible, or currently hold, position as commissioned officer in the Regular Corps of the Public Health Service or be eligible for civilian service in the NHSC
  • Currently participate or be eligible to participate as a provider in the Medicare, Medicaid, and Children’s Health Insurance Programs
  • Have a fully-legal and unrestricted health professional license, certificate or registration in the relevant discipline.

You can learn more here.

National Institutes of Health Loan Repayment Programs

The National Institutes of Health (NIH) has a group of repayment programs for professionals in the biomedical and biobehavioral research fields. You can earn up to $35,000 per year to repay student loan debt by committing to research approved by the NIH.

The purpose of these programs is to entice professionals back into research over other higher paying careers. To qualify for an NIH loan repayment program, your student loan debt must total at least 20% of your base salary. You can learn more in our review of the program here.

Grab Free Tools to Help You Manage Payments

Several of the strategies above may reduce your medical school debt but you won’t be able to avoid it forever.

Developing a budget and cutting back in other areas can help you repay debt aggressively. The following tools can give you an extra push during this repayment process: is a money management tool that shows you an entire picture of your financial standing including your student loan debt all in one dashboard. You can use this tool to manage your monthly budget and track your spending.

The Repayment Estimator is on the Federal Student Aid website and estimates how much you’ll pay with different federal loan repayment plans. This is useful because it can give you an idea of which payment plan will be the one to benefit you the most based on your income and family status.

The burden of repaying student loan debt after you’ve already paid your dues to obtain medical qualifications can be a challenge. Fortunately, there are many opportunities to get relief from student loans after medical school. Take the time to explore all of these options to figure out what will work best for you.


College Students and Recent Grads, Student Loan ReFi

11 States That Make It Easy to Refinance Student Loan Debt

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Of the $1.3 trillion in unpaid student loan debt circulating in the U.S. today, a whopping $211 billion of those loans should be eligible for refinancing, according to a recent report by Goldman Sachs. Refinancing student loan debt can be best way to lower your interest rate or achieve more affordable payments.

There are a handful of private companies and banks that offer student loan refinancing options today. These companies may offer tantalizing rates of 2-7%, but they also make it exceedingly difficult for borrowers to qualify. For example, the average SoFi borrower is in far better shape than most college graduates. She earns $142,414 per year and has a credit score of 776, according to a report by credit ratings industry analyst DRBS. Meanwhile, the average 2015 college graduate earns just over $51,000 and 40% of people under the age of 30 have credit scores under under 600.

The good news is that an increasing number of states are getting into the business, providing more competition for existing refinance lenders.  This is a relatively new trend. When the federal government began issuing student loans directly back in 2010, most states got out of the student loan business altogether. Today, 11 states offer programs that allow borrowers to refinance their student loans, with about a dozen more programs in the works  Many of these refinancing programs are still in their infancy. As of December 2015 — 18 months into its launch — Rhode Island’s refinance program had only refinanced loans for 349 borrowers, according to the Pew Charitable Trusts.

Are state-run refinance programs worth it?

We decided to take a deeper look at the programs that exist today. What we found is a mixed bag of opportunities. While some states do have more relaxed standards than private lenders, many offer the best refinancing rates to borrowers who have the best credit. Most of the programs we reviewed required FICO scores of at least 670-700. The best rates are reserved for those who either have a cosigner or a top notch FICO score. And a borrower’s FICO score is just the beginning. Many programs won’t extend loans to borrowers who have a history of missing student loan payments or who have filed bankruptcy in the past. Other programs require a cosigner or ask that borrowers meet a minimum annual income threshold.

Whether borrowers are considering refinancing student loan debt through a commercial lender or a state-run program, it’s important to realize there is no silver bullet for student debt.

“Just because a loan is made by a state lender doesn’t mean that it is better or worse than a loan from a commercial lender,” says Mark Kantrowitz, a student loan expert and publisher of “Borrowers should shop around, applying to several loans to see which lender will offer them the lowest cost loan.”

Refinancing federal student loan debt is an especially tricky decision to make, whether you’re considering private commercial or state-backed refi loans. College students who borrowed federal loans in the late 90s and early 2000s could easily find themselves stuck with interest rates as high as 8%. As it stands, the only way to refinance those loans to get a better rate is to apply for a federal direct consolidation loan. This loan does allow borrowers to refinance, but it merely takes the average of the interest rates of all their loans in order to determine your new rate. If their loan rates are all similar, a direct consolidation loan really won’t make all that much of a difference in the long-run.

There are other stakes to consider when it comes to refinancing federal student loan debt. When a borrower refinances their federal student loans, they are essentially swapping out federal loans for a private loan. That means they will forfeit all of the protections they have as a federal student loan borrower. They won’t be able to take advantage of flexible repayment options like PAYE, income-based repayment plans or public service loan forgiveness.

Timing is important, too. Borrowers are usually better off waiting a few years until after they graduate to pursue refinance options, Kantrowitz says. Many borrowers may need time after college to build up their credit before refinance becomes a viable option.

“It takes a few years after graduation of managing one’s credit responsibly for a borrower’s credit score to improve enough that they will qualify for a better rate,” Kantrowitz says.

Lastly, refinance or consolidation loans are not always the best ways to save money in the long-term. If borrowers choose to take on loan with a longer repayment period, while their monthly payments and interest rate may be lower, they could end up paying more in total interest over time.
We’ve identified all of the states that offer refinancing programs in the U.S. in the map above. Below, we offer details on each state’s program, from what it takes to qualify to what rates they offer. Because some states are in the process of launching refinancing programs, we have included those as well.

Don’t see your state on the list?  Don’t give up just yet. Some states allow any borrower — regardless of their home state — to apply for refinancing.

(The information below is current as of Aug. 5, 2016.)

Iowa: Reset Loans

Iowa’s refinancing program, Reset Loans, is run by a non-profit called Iowa Student Loan. The organization is overseen by a board of directors appointed by the state’s governor.

This program is still technically in pilot mode until lawmakers in DC offer some more clarification on the full extent of allowable uses of tax-exempt bonds, but don’t let that stop you from applying. For a pilot program, it’s robust.

Eligibility: Anyone from any state in the U.S. can apply, but Iowa residents are eligible for slightly lower interest rates.

Repayment terms: They offer 5-, 10- and 15-year loan terms.

Interest rate: See a full list of rates here.

The lowest available rates for a credit score of 830 or higher are:

  • 5-year term: 4.24% (residents) and 4.49% (non-residents)
  • 10-year term: 5.30% (residents) and 5.55% (non-residents)
  • 15-year term: 5.69% (residents) and 5.94% (non-residents)

What you need in order to qualify: 

  • An annual income of at least $25,000.
  • A FICO score of at least 720.
  • No more than two accounts reporting 30-day delinquencies during the previous two years.
  • No delinquencies of 60 days or more during the previous two years.
  • No charge-offs, repossessions, collection accounts, judgments, foreclosures, garnishments by credit providers or tax liens.
  • No previous bankruptcies.

How it’s funded: The pilot program is currently funded through internal sources. Future program funding is expected to come from tax-exempt bond proceeds.

Where to learn moreReset Loans

Massachusetts: MEFA

Massachusetts Educational Finance Authority (MEFA) offers the MEFA Educational Refinancing Loan to all U.S. Residents.

Eligibility: All U.S. permanent residents, regardless of state.

Refinance terms: MEFA offers only 15-year repayment terms.

Interest rate: With excellent credit, rates can be as low as 4.95% fixed and variable interest rates as low as 3.28% APR. Fixed Rates 4.95% – 6.85% APR; Variable Rates 3.28% – 6.12% APR.

What you need in order to qualify: 

  • Minimum 670 FICO score.
  • At least $10,000 worth of loans you are seeking to refinance.
  • No past default history on your student loans (more than 270 days behind on payments)
  • No history of bankruptcy or foreclosure in the past 60 months.

How it’s funded: Taxable bonds.

Where to learn moreMEFA

Rhode Island: RISLA Refinance Loan

Eligibility: Borrowers may reside in any U.S. state.

Refinance terms: 5-, 10-, and 15-year loans. It should be noted that RISLA Refinance Loans do allow for twelve months of forbearance, but that this option pales in comparison to federal forbearance options that you will be giving up when you refinance federal student loans.

Interest rate: To get the best possible rates, you will need a cosigner. The lowest-possible rate for a 15-year term loan without a cosigner is 7.24%. That rate falls to 5.99% if you have a cosigner. You can also shave 0.25% off your rate if you agree to set up auto-pay. (See full rate details here)

What you need in order to qualify: 

  • If you and your cosigner reside at the same address, you must earn a combined income of at least $40,000 per year. If you live at different addresses, then either the borrower or the cosigner must make $40,000 individually.Where to learn moreRISLA

How it’s funded: Taxable bonds.

Kentucky: Advantage Education Loans

Eligibility: Only available to residents of Kentucky, Georgia, Mississippi, Missouri, Ohio, Virginia and West Virginia.

Refinance terms: 10, 15, 20, or 25 years.

Interest rate: They offer fixed rate loans. Rates range from 3.99% to 7.99%.

What you need in order to qualify: 

  • A minimum 670 FICO score for both the borrower and co-signer
  • To get the best rates, you’ll need a cosigner.
  • At least $7,500 in loans to refinance.

Extra perk: Kentucky’s refinance program will forgive your loan if you die or become disabled. Your cosigner will be relieved of his or her duty to pay as well.

How it’s funded: Excess agency assets, including governmental, fiduciary and proprietary funds. You can see a breakdown of the agency’s assets for 2015 here.

Where to learn more:  KHESLC

Alaska: Alaska Refi

Alaska Refi will offer a fixed interest rate of 5.20% on 5-, 10- and 15-year loans. *Update: Alaska’s program officially launched Aug. 1, 2016.

What you’ll need in order to qualify:

  • At least $7,500 in qualifying education loans in good standing
  • Have a FICO score of 720 or higher, or a cosigner who meets the FICO score requirement
  • Be employed or have other regular source of income
  • Open only to Alaska residents

The program is brand new and funding is on a first come, first served basis. You can sign up here.

How it will be funded: The Alaska Student Loan Corporation

South Carolina: PAL ReFi

South Carolina offers low-rate refinance offers through the Palmetto Assistance Loan (PAL) ReFi program.

Eligibility: You must be a South Carolina resident.

Refinance terms: 5-, 10, or 15-year terms.

Interest rates: South Carolina’s loan program is unique in that it offers just three different fixed rates for its loans. Those rates vary depending on which loan term you sign up for. For example, a five-year loan carries a 5% rate. A 10-year loan carries a 5.75% rate. A 15-year loan carries a 6.25% rate. You can take an additional 0.25% off that rate by enrolling in auto payments.

What you need in order to qualify:

  • A FICO score of 675 or higher.
  • You must be employed.
  • A debt-to-income ratio of 30% or less.
  • If you use a cosigner, he or she must be at least 24 years old.

Fine print: Borrowers with $20,000 or less in loans may only select a 5- or 10-year repayment term. Borrowers with more than $20,000 in loans may opt for the 15-year term.

How it’s funded: South Carolina Student Loan is a private non-profit that currently funds their PAL ReFi loans with their own assets. For now, that funding is more than sufficient. It is possible that they will look to bonds in the future, though.

Where to learn morePAL ReFi

Connecticut: Refinance CT

Eligibility: Must be a Connecticut resident or have attended an eligible Connecticut college or university. Those refinancing a CHELSA loan do not need to be a Connecticut resident.

Refinance terms: 5-, 10- or 15-year terms.

Interest rate: This program offers only fixed rates ranging from 4.25-7%. They  offer a 0.25% interest rate reduction for scheduling auto-payments.


  • Monthly installment payments most be 43% or less of monthly gross income.
  • Maximum amount you can refinance: $100,000

How it’s funded: An initial $5 million was provided through the assets of a subsidiary organization in much the same way as Kentucky’s program currently receives funding. When the initial funds are exhausted, this program will be funded by a mix of taxable and tax-exempt bonds, depending on market conditions.

Where to learn

Minnesota: SELF Refi

Eligibility: Minnesota residents only.

Refinance terms: 5, 10, and 15-year loans on sums of $10,000 or more.

Interest rate: Fixed rate loans vary from 4.5% to 6.95%. Variable rate loans vary from 3.2% and 4.55% (Beware: variable interest rates are capped at a whopping 18%).


  • A 720 credit score or higher, though you may still qualify if you have a co-signer.
  • You need at least $10,000 in student loan debt to refinance.

How it’s funded: Funding comes from excess assets of the Minnesota Office of Higher Education. Some of those assets come from the interest paid on student loans, making at least a portion of the program self-funding. A full explanation of 2015 finances for the agency can be found here.

Where to learn moreSELF Refi 

North Dakota: Deal One Loan

Eligibility: North Dakota residents who lived at a physical address in the state for the past six months.

Qualifications: The borrower is required to have a minimum FICO score of 700 or a cosigner with a minimum FICO score of 650 is necessary. Other factors will also be considered.

Refinance terms:  Terms are based on how much you want to refinance.

Under $10,000: 10-year repayment term
$10,000 – $20,000: 15-year repayment term
$20,001-$30,000: $20-year repayment term
$30,0001 and up: 25-year repayment term.

Interest rate: Rates are determined by the term of your loan. The fixed rates APR is 4.33%. The variable interest rate APR is 2.15%, with a lifetime cap of 10%.

How it’s funded: The program is administered by Bank of North Dakota (BND), the only state-owned Bank in the country. All tax revenue is deposited at BND and is repurposed for a number of loan programs, including student loans.

Where to learn moreDeal One Loan 


Maine’s student loan refinance program is different from that of any other state. The Finance Authority of Maine backs loans issued by private lenders who offer student loan refinancing or consolidation. That way, consumers can pick from different local financial institutions competing against each other. The lenders are able to offer lower rates because of the insurance provided by the state agency.

Eligibility: Set by individual financial institutions, in collaboration with FAME.

Refinance terms: Set by individual financial institutions, in collaboration with FAME.

Interest rates: Set by individual financial institutions, with final approval from FAME. The entire point of this program is to keep rates competitive, so if you’re unhappy with the first rate you see, shop around.


  • Minimum 680 FICO credit score for the borrower and cosigner (if applicable)
  • $24,000 minimum annual income for borrower or cosigner (if applicable). If there is a cosigner on the loan, the cosigner must have a minimum of two years of work history.
  • Minimum/maximum loan balance: $10,000/$240,000

How it’s funded: Maine runs this program similar to the way they run their commercial loan insurance program. In order for a loan to carry the insurance, guarantee fees must be paid. Financial institutions have the option to cover these fees themselves, or pass the cost on to consumers. Either way the fees get paid to the Finance Authority, and are then managed to build reserves in the event of a claim.

How to apply: Before taking out one of these loans, you will be required to take a ten-minute course on loan counseling online. A list of the current participating lenders includes: Infinity Federal Credit Union; Maine State Credit Union; Maine Savings Federal Credit Union; Seaboard Federal Credit Union; and University Credit Union.  Apply at any lender’s website or visit the for the links to the lenders.

New Jersey: NJCLASS Consolidation Loan

New Jersey currently allows borrowers to consolidate their loans through the NJCLASS Consolidation Loan. An NJCLASS loan will allow you to refinance two or more loans by bundling them into a single loan and restructuring your repayment period and your interest rate. The rate for your new loan will be determined by taking the weighted average of the interest rates for each individual loan.

Eligibility: NJCLASS consolidation loans are offered to New Jersey residents attending an eligible in-state or out-of-state school and out-of-state students attending a school in New Jersey.


  • Must consolidate a minimum of $30,000.
  • Must have 2 or more NJCLASS loans.
  • NJCLASS Loans must be current.
  • Borrowers must meet a minimum annual income requirement of $40,000.

Refinance terms:

  • 25-year term: Total loan balance of $30,000 to $60,000
  • 30-year term: Total loan balance of $60,000 or greater

Interest rate: The interest rate on a NJCLASS Consolidation loan will be determined by taking the weighted average of the interest rates for each individual loan minus 0.25%.

Other fees: There is a 1% administrative fee tacked on to all loans.

Coming Soon…

Some states are on the cusp of providing student loan refinancing options. These states may have passed the necessary legislation, but are still working on getting their programs ready to open to applicants. That means we aren’t able to link to any specific websites for more information. But we’ve shared what we know so far:

The NJCLASS Refi+ Loan

In the Fall of 2016, New Jersey will launch the NJCLASS Refi+ loan. This program will allow borrowers to refinance even individual loans, removing the requirement for consolidation.

Eligibility: NJCLASS Refi+ will require applicants to either be state residents at the time of application, or to have been state residents when they originated the loan they are attempting to refinance.


  • Must earn an annual income of $40,000
  • Must have a minimum FICO score of 670
  • Debt-to-income ratio must be less than 40%.

Interest rates: The NJCLASS Refi+ will determine your loan rate based on your credit score.

  • Scores of 780+ will merit an interest rate of 4.90%.
  • Scores of 720-779 will merit an interest rate of 5.70%.
  • Scores of 670-719 will merit an interest rate of 6.90%.
  • Those with scores below 670 may qualify with a parental cosigner.

How it’s funded: NJCLASS Refi+ will be funded through tax-exempt bonds.

Where to learn

Maryland (Montgomery County)

Montgomery County, Md. will establish the Montgomery County Student Loan Refinancing Authority by April 2017. Unfortunately, only residents of Montgomery County can apply.


Virginia lawmakers have proposed a student loan refinance program, but have yet to vote on the bill. To follow along as it moves through the state legislature bookmark the bill’s page.


Wisconsin’s SB 194, which would have established a State Loan Refinancing Authority to provide a means for borrowers to refinance student loans at lower rates. It was voted down in April 2016.


Nevada’s SB 215 also would have allowed for state refinancing of student loans. It was heard, but no action was taken.


Missouri’s HB 2432 has reached the house floor but has not yet been voted on. It isn’t looking good.


California actually did pass legislation that would have opened the door for a student loan refinancing program. However, the program never received funding from the state, rendering it useless.