Leaving college with multiple student loans can be overwhelming. As you start repaying that debt, you may want to consider student loan consolidation or refinancing. Both options may help you save money or at least feel more in control of your monthly finances, but there are major differences.
In this article, we’ll explain the pros and cons to help you decide if student loan consolidation or refinancing is the right option for you.
Student loan consolidation vs. refinancing
Choosing between student loan consolidation and refinancing is a big decision. While both options adjust your loan payments, they have different benefits and requirements.
Student loan consolidation generally refers to federal student loans. By combining your debts into a Direct Consolidation Loan, you can merge all or some of your federal student loans into a single new loan. Your interest rate on the new loan is a weighted average of the rates on all of the consolidated debt.
One of the perks of federal consolidation is that you can consolidate multiple types of federal loans, including subsidized, unsubsidized, federal PLUS, and Perkins Loans. In addition, you don’t lose any federal student loan protections, such as income-driven repayment, loan forgiveness, deferral, or forbearance options. The downside is you can’t include any private student loans in federal consolidation.
Student loan refinancing involves taking out a new private student loan and using it to pay off your existing federal and/or private student loans. The new loan has a different interest rate and loan term, allowing you to potentially lower your interest rate or reduce your monthly payments by extending the loan term.
The downside of refinancing is that you lose many of the protections that come with federal student loans.
| | |
|---|
| Combines multiple federal student loans into one single federal loan | Replaces existing federal and/or private student loans with a new private loan |
| | Federal and private student loans |
| Fixed rate based on weighted average of your existing federal loans | Based on market interest rates and your personal credit |
| | Typically capped at 20 years |
| Eligible for benefits like income-driven repayment, loan forgiveness programs, deferral, or forbearance | Must qualify for a loan based on credit score and income requirements. No access to federal benefits. |
Federal student loan consolidation
Federal student loan consolidation makes sense for borrowers with multiple federal loans who want one monthly payment to simplify their finances.
Consolidation won’t lower your overall interest rate, but you’ll keep the option to take advantage of student loan forgiveness programs and income-based repayment plans.
Eligibility requirements
Student loan consolidation is easier to qualify for than private student loan refinancing because your credit score and income aren’t a factor.
Most types of federal student loans are eligible for consolidation. To qualify, you must have graduated or dropped below half-time enrollment at school.
Interest rates and terms
The interest rate on student loan consolidation is a weighted average of the rates on the loans you include, rounded up to the nearest one-eighth of a percentage point. For example, let’s say you have four student loans, each with a balance of $10,000. Those loans have interest rates of 5%, 6%, 6.5%, and 6.75%. In that case, the interest rate on your new loan would be 6.125%. That’s (5 + 6 + 6.5 + 6.75) / 4 = 6.0625, which, when rounded up to the nearest one-eighth of one percent, is 6.125%.
In other words, you’d have a higher interest rate than one of your loans but a lower rate than the other three loans.
Depending on the amount you consolidate, you might also have the option to extend your loan term to up to 30 years to keep your monthly payments more affordable.
Keep in mind:
Think carefully before extending your loan term. Your monthly payment may be lower, but you’ll likely end up paying more interest over the life of the loan.
How to apply
To consolidate your federal student loans, log into your account at StudentAid.gov and complete the free Direct Consolidation Loan Application. You’ll need to provide your contact information, income, and information on your existing loans.
Once you submit your application, it takes 30 to 45 business days to process your application. In the meantime, continue to make payments on your existing loans as usual.
Once your application is approved, you’ll receive a statement summarizing the new loan terms, repayment schedule, and the total interest you’ll pay over the life of the loan.
Pros and cons
Before you complete a loan consolidation application, it’s important to understand the advantages and downsides.
Pros:
- You’ll have the option to extend your repayment term
- You won’t lose access to federal protections, including student loan forgiveness programs like income-driven repayment, deferral, or forbearance
Cons:
- You may pay more interest over the life of the loan if you extend your repayment term
- You won’t reduce your overall interest rate
Private student loan refinancing
Private student loan refinancing is available on any loan — federal or private. However, if you include federal student loans in a private refinance, you lose the benefits available to federal loan borrowers.
This isn’t always a bad thing, though. It depends on your financial situation and what you’re trying to achieve. For example, if you want to pay off your loans faster, you may benefit from refinancing into a loan with a shorter term and lower interest rate.
Check out: How To Refinance Your Student Loans in 6 Steps
Eligibility requirements
Eligibility requirements for private student loan refinancing vary based on your qualifying factors, including your credit score, income, and debt-to-income ratio (DTI).
Every lender has different requirements and terms, so it’s important to shop around and get prequalified by different lenders. However, some common eligibility requirements include:
- Being a U.S. citizen or permanent resident alien
- Graduating with a bachelor’s degree or higher
- Credit score of at least 680
Interest rates and terms
The interest rates and terms on private student loan refinancing vary by lender and depend on your credit profile and income. For example, if you have good or excellent credit, you’ll probably have a better chance of securing a lower interest rate than someone with average or poor credit.
How to apply
Each refinancing lender has different application requirements, but many offer online applications and the ability to prequalify without impacting your credit. Consider checking out a handful of lenders to compare your options.
Compare Rates Now
Pros and cons
As with loan consolidation, there are pros and cons to consider before applying for student loan refinancing.
Pros:
- Potential to lower your interest rates
- You may be able to include a cosigner for better rates and loan terms
Cons:
- You lose access to federal protections when you refinance federal student loans
- You may not qualify if you have poor credit and low or no income
Advertiser DisclosureOverview
Brazos offers refinancing loans to Texas residents who have a bachelor’s degree or higher from an eligible school. There are no origination or application fees, and interest rates could be lower than what you find with other private lenders.
However, some borrowers may find that Brazos has relatively strict eligibility requirements. Borrowers must have a minimum income of $60,000 and a credit score of 720 or higher. If you can’t meet those minimums alone, you can add a cosigner that can be released after 24 on-time consecutive payments.
pros
- Five loan terms available
- Competitive rates
- Cosigner release
- No origination or application fees
- Autopay discount of 0.25 percentage points
cons
- Only available to Texas residents
- High minimum credit and income requirements
- Bachelor’s degree required
Loan terms
5, 7, 10, 15, or 20 years
Loan amounts
$10,000 minimum, up to $150,000 for bachelor’s degrees and $400,000 for graduate, medical, law, or other professional degrees
Cosigner release
Yes, after 24 on-time payments
Eligibility
Borrower must be a Texas resident and a U.S. citizen or permanent resident who has a bachelor’s degree or higher.
$5,000 up to the full balance
Overview
Undergraduate and graduate students can refinance their student loans with SoFi® if they meet eligibility requirements. You can prequalify for a loan in two minutes without affecting your credit score, and the lender offers both fixed and variable rates. Plus, SoFi offers unique benefits to its members, including access to networking events and financial advisers.
SoFi requires a minimum loan balance of $5,000 to refinance. You can add a cosigner to your application, and remove them after 24 consecutive on-time payments. You can find out your potential rate through prequalification, but the lender doesn't disclose its minimum credit score or income requirements.
pros
- Doesn’t charge loan prepayment, origination, application, or late payment fees
- Borrowers can get free financial planning advice, referral bonuses, and discounts
- Offers a wide range of repayment plans
cons
- Must have at least $5,000 in loans to refinance
- No cosigner release available
Loan terms
5, 7, 10, 15, or 20 years
Loan amounts
$5,000 up to full outstanding balance
Eligibility
Must be a U.S. citizen or permanent resident. Must have made 6 on-time payments in the past 6 months, with no record of default, delinquency, bankruptcy, or foreclosure in the last five years. Employment is required, or you must have a job offer starting within 90 days. Must also have attended a Title IV-eligible school.
$10,000 up to total refinance amount
Overview
ELFI offers student loan refinancing to borrowers who graduated with a bachelor's degree or higher. Borrowers can even refinance their parents' PLUS loans in their own name. Plus, each ELFI borrower gets paired with a student loan adviser to help them through the refinancing process.
While borrowers can add a cosigner to their application, they can't release that cosigner later on. ELFI also doesn't offer rate discounts, but borrowers can apply for a forbearance of up to 12 months if they're experiencing financial hardship.
pros
- Doesn’t charge application or origination fees
- Borrowers are assigned to a student loan adviser
- Student borrowers can refinance parent PLUS loans in their name
- Clear credit and income requirements
- Offers financial hardship forbearance of up to 12 months
cons
- Doesn’t offer any discounts
- Need at least a bachelor’s degree to refinance
- Doesn’t offer cosigner release
- Charges fees for late and returned payments
Loan terms
5, 7, 10, 15, or 20 years for student loan refinancing; 5, 7, or 10 years for parent loan refinancing
Loan amounts
Minimum of $10,000 with no set maximum.
Eligibility
Must be a U.S. citizen or permanent resident with a bachelor’s degree or higher. Must have at least $10,000 in student loans to refinance and a minimum credit history of 36 months.
Overview
LendKey is a marketplace that connects borrowers with more than 300 community banks and credit unions to find the best student loan refinancing options. Unlike most lenders, LendKey allows you to refinance your student loans while you're still in school, as long as you've earned at least an associate degree.
One of LendKey's biggest advantages is that it can help you compare multiple loan offers in one place. However, specific loan terms and eligibility requirements will vary by lender. Basic eligibility criteria include a minimum credit score of 680 and at least $5,000 in outstanding debt to refinance.
pros
- You can refinance with just an associate degree
- Can earn a $200 bonus for referring friends and family
- Lower your rate by a quarter of a percentage point with autopay
- No fees for applications or loan origination
cons
- Some lenders may require membership in a credit union or local bank
- Loan terms and qualifications vary by lender
Loan terms
5, 7, 10, 15, or 20 years
Cosigner release
Varies based on lender's terms
Eligibility
Must be a U.S. citizen or permanent resident and have already graduated with at least an associate degree from one of LendKey lenders’ eligible institutions.
Overview
INvestEd is a nonprofit based in Indiana that offers student loan refinancing to borrowers nationwide. It offers competitive rates and a discount for setting up autopay. INvestEd also allows cosigners to be released after 12 on-time payments, which is sooner than some other student loan refinancing lenders.
However, the most you can refinance through INvestEd is $250,000, less than what other lenders may allow. It also has strict credit and income requirements to qualify, or you'll need an eligible cosigner. INvestEd clearly defines its credit requirements before you apply, but you can't prequalify with a soft credit check.
pros
- Refinancing available even for non-degree holders
- Offers a one-quarter percentage point rate discount for autopay
- Deferment available while in school, military service or under financial hardship
- Will release cosigners after as few as 12 payments
cons
- Relatively low maximum refinance amount compared with some competitors
- Doesn’t offer prequalification to see rates before you apply
- No refinancing available for international students
- Parent loans cannot be refinanced in student’s name
Eligibility
U.S. citizens or permanent residents are eligible. Borrowers must meet minimum requirements including a FICO score of 670 or higher, annual income of $36,000, a debt-to-income ratio below 40% to 50%, a year of continuous employment, and no defaults or serious collection activities in recent years.
Overview
Citizens student loan refinancing is available to qualified borrowers who want to refinance at least $10,000.
Borrowers who earned undergraduate degrees can refinance as much as $300,000 in student loans. Those who borrowed for graduate or professional degrees can refinance from $500,000 to $750,000. Citizens refinancing loans are available with fixed or variable rates. Repayment terms are flexible, ranging from five to 20 years.
Medical residents can refinance student loans and only pay $100 per month for up to four years while completing residency or fellowship.
pros
- Range of repayment options between 5 and 20 years
- Offers prequalification with no impact on credit score
- Offers rate discounts for existing customers and autopay
cons
- Cosigners not eligible for release until after 36 payments are made
- Refinancing unavailable until you make 12 payments on your loans if you earned an associate degree or no degree at all
- Minimum loan amounts are higher than some other lenders
Loan terms
5, 7, 10, 15, or 20 years
Loan amounts
$10,000 minimum, with a maximum of $300,000 for bachelor’s degree or below; $500,000 for graduate degrees; and $750,000 for professional degrees
Eligibility
Must refinance at least $10,000 in student loans and be a U.S. citizen, permanent resident, or resident alien with a valid U.S. Social Security number. Must have earned at least a bachelor's degree to qualify.
Overview
EdvestinU offers student loan refinancing through Granite Edvance Corporation, a New Hampshire-based nonprofit. The lender stands out with competitive interest rates and flexible repayment terms for borrowers with strong credit. To qualify, you'll need a credit score of at least 700 and an annual income of $30,000 for loans less than $100,000 or $50,000 for larger amounts. However, loans aren't available in all U.S. states.
Unlike many lenders, EdvestinU lets you refinance without a degree or while still enrolled in school. New Hampshire residents also receive a 1.5 percentage point interest rate reduction, making it an excellent option for those in the state.
pros
- You can refinance without a degree or while enrolled in school
- Autopay rate discount available
- New Hampshire residents save 1.5 percentage points on their interest rate
cons
- Refinancing is only available in select states
- High minimum credit score requirement
- Requires a higher minimum loan balance than some lenders
- Cosigner release requires 2 years of on-time payments
Eligibility
U.S. citizens or permanent residents who are at least 18 years old and reside in Alaska, Arkansas, Colorado, Connecticut, Florida, Maine, Massachusetts, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Puerto Rico, Rhode Island, Texas, Utah, Virginia, Washington, West Virginia, and Wisconsin.
$10,000 up to the total amount
Overview
Massachusetts Educational Financing Authority (MEFA) is a student refinancing lender offering a wide range of options, including to borrowers who didn't finish school. Though the lender doesn't offer variable-rate options, its fixed-rate loans have competitive rates.
MEFA's mission is to provide affordable student loans, and it doesn't charge any fees. You must have at least $10,000 in student loans to refinance, and you must have made a minimum of six consecutive on-time payments over the last six months. Borrowers who are unable to qualify on their own can add a cosigner to their application.
pros
- You can refinance without having graduated
- Doesn’t charge fee
- Can prequalify to check your rate
cons
- Can’t release a cosigner
- Doesn’t have any discounts
- Can’t refinance parent student loans
- Doesn’t offer variable-rate loans
Loan amounts
$10,000 up to your total debt
Eligibility
Must be a U.S. citizen or permanent resident who is the primary borrower on education debt used to attend an eligible college or university. Must have made six on-time loan payments over the most recent six months. Must have no history of default or delinquency on education debt for the past 12 months and no history of bankruptcy or foreclosure in the past five years.
Overview
The Rhode Island Student Loan Authority (RISLA) is a nonprofit lender offering student loan refinancing to borrowers across the U.S. You can refinance even if you didn't complete your degree, as long as you have at least $7,500 in student loan debt.
What makes RISLA unique is the flexibility it offers borrowers. If you're facing financial difficulties, RISLA provides income-based repayment options to help manage your payments. For added relief, you can access up to 24 months of forbearance, which is more than many lenders offer. If you return to graduate school, you can defer your payments for up to three years, giving you time to focus on your studies without worrying about loan payments.
pros
- Offers income-based repayment
- Generous payment relief options
- You can refinance without a degree
- Get a rate discount when you enroll in autopay
cons
- High minimum income requirement
- No cosigner release option
- Fewer repayment terms to choose from
- Does not offer variable rates
Loan amounts
$7,500 minimum up to of $250,000, depending on degree
Eligibility
Borrower or cosigner must meet credit requirements. Student must be a U.S. citizen or permanent resident and have used original student loans to attend an eligible degree-granting institution.
Overview
Brazos offers refinancing loans to Texas residents who have a bachelor’s degree or higher from an eligible school. There are no origination or application fees, and interest rates could be lower than what you find with other private lenders.
However, some borrowers may find that Brazos has relatively strict eligibility requirements. Borrowers must have a minimum income of $60,000 and a credit score of 720 or higher. If you can’t meet those minimums alone, you can add a cosigner that can be released after 24 on-time consecutive payments.
pros
- Five loan terms available
- Competitive rates
- Cosigner release
- No origination or application fees
- Autopay discount of 0.25 percentage points
cons
- Only available to Texas residents
- High minimum credit and income requirements
- Bachelor’s degree required
Loan terms
5, 7, 10, 15, or 20 years
Loan amounts
$10,000 minimum, up to $150,000 for bachelor’s degrees and $400,000 for graduate, medical, law, or other professional degrees
Cosigner release
Yes, after 24 on-time payments
Eligibility
Borrower must be a Texas resident and a U.S. citizen or permanent resident who has a bachelor’s degree or higher.
Loan Amounts
$5,000 up to the full balance
Overview
Undergraduate and graduate students can refinance their student loans with SoFi® if they meet eligibility requirements. You can prequalify for a loan in two minutes without affecting your credit score, and the lender offers both fixed and variable rates. Plus, SoFi offers unique benefits to its members, including access to networking events and financial advisers.
SoFi requires a minimum loan balance of $5,000 to refinance. You can add a cosigner to your application, and remove them after 24 consecutive on-time payments. You can find out your potential rate through prequalification, but the lender doesn't disclose its minimum credit score or income requirements.
pros
- Doesn’t charge loan prepayment, origination, application, or late payment fees
- Borrowers can get free financial planning advice, referral bonuses, and discounts
- Offers a wide range of repayment plans
cons
- Must have at least $5,000 in loans to refinance
- No cosigner release available
Loan terms
5, 7, 10, 15, or 20 years
Loan amounts
$5,000 up to full outstanding balance
Eligibility
Must be a U.S. citizen or permanent resident. Must have made 6 on-time payments in the past 6 months, with no record of default, delinquency, bankruptcy, or foreclosure in the last five years. Employment is required, or you must have a job offer starting within 90 days. Must also have attended a Title IV-eligible school.
Loan Amounts
$10,000 up to total refinance amount
Overview
ELFI offers student loan refinancing to borrowers who graduated with a bachelor's degree or higher. Borrowers can even refinance their parents' PLUS loans in their own name. Plus, each ELFI borrower gets paired with a student loan adviser to help them through the refinancing process.
While borrowers can add a cosigner to their application, they can't release that cosigner later on. ELFI also doesn't offer rate discounts, but borrowers can apply for a forbearance of up to 12 months if they're experiencing financial hardship.
pros
- Doesn’t charge application or origination fees
- Borrowers are assigned to a student loan adviser
- Student borrowers can refinance parent PLUS loans in their name
- Clear credit and income requirements
- Offers financial hardship forbearance of up to 12 months
cons
- Doesn’t offer any discounts
- Need at least a bachelor’s degree to refinance
- Doesn’t offer cosigner release
- Charges fees for late and returned payments
Loan terms
5, 7, 10, 15, or 20 years for student loan refinancing; 5, 7, or 10 years for parent loan refinancing
Loan amounts
Minimum of $10,000 with no set maximum.
Eligibility
Must be a U.S. citizen or permanent resident with a bachelor’s degree or higher. Must have at least $10,000 in student loans to refinance and a minimum credit history of 36 months.
Overview
LendKey is a marketplace that connects borrowers with more than 300 community banks and credit unions to find the best student loan refinancing options. Unlike most lenders, LendKey allows you to refinance your student loans while you're still in school, as long as you've earned at least an associate degree.
One of LendKey's biggest advantages is that it can help you compare multiple loan offers in one place. However, specific loan terms and eligibility requirements will vary by lender. Basic eligibility criteria include a minimum credit score of 680 and at least $5,000 in outstanding debt to refinance.
pros
- You can refinance with just an associate degree
- Can earn a $200 bonus for referring friends and family
- Lower your rate by a quarter of a percentage point with autopay
- No fees for applications or loan origination
cons
- Some lenders may require membership in a credit union or local bank
- Loan terms and qualifications vary by lender
Loan terms
5, 7, 10, 15, or 20 years
Cosigner release
Varies based on lender's terms
Eligibility
Must be a U.S. citizen or permanent resident and have already graduated with at least an associate degree from one of LendKey lenders’ eligible institutions.
Overview
INvestEd is a nonprofit based in Indiana that offers student loan refinancing to borrowers nationwide. It offers competitive rates and a discount for setting up autopay. INvestEd also allows cosigners to be released after 12 on-time payments, which is sooner than some other student loan refinancing lenders.
However, the most you can refinance through INvestEd is $250,000, less than what other lenders may allow. It also has strict credit and income requirements to qualify, or you'll need an eligible cosigner. INvestEd clearly defines its credit requirements before you apply, but you can't prequalify with a soft credit check.
pros
- Refinancing available even for non-degree holders
- Offers a one-quarter percentage point rate discount for autopay
- Deferment available while in school, military service or under financial hardship
- Will release cosigners after as few as 12 payments
cons
- Relatively low maximum refinance amount compared with some competitors
- Doesn’t offer prequalification to see rates before you apply
- No refinancing available for international students
- Parent loans cannot be refinanced in student’s name
Eligibility
U.S. citizens or permanent residents are eligible. Borrowers must meet minimum requirements including a FICO score of 670 or higher, annual income of $36,000, a debt-to-income ratio below 40% to 50%, a year of continuous employment, and no defaults or serious collection activities in recent years.
Overview
Citizens student loan refinancing is available to qualified borrowers who want to refinance at least $10,000.
Borrowers who earned undergraduate degrees can refinance as much as $300,000 in student loans. Those who borrowed for graduate or professional degrees can refinance from $500,000 to $750,000. Citizens refinancing loans are available with fixed or variable rates. Repayment terms are flexible, ranging from five to 20 years.
Medical residents can refinance student loans and only pay $100 per month for up to four years while completing residency or fellowship.
pros
- Range of repayment options between 5 and 20 years
- Offers prequalification with no impact on credit score
- Offers rate discounts for existing customers and autopay
cons
- Cosigners not eligible for release until after 36 payments are made
- Refinancing unavailable until you make 12 payments on your loans if you earned an associate degree or no degree at all
- Minimum loan amounts are higher than some other lenders
Loan terms
5, 7, 10, 15, or 20 years
Loan amounts
$10,000 minimum, with a maximum of $300,000 for bachelor’s degree or below; $500,000 for graduate degrees; and $750,000 for professional degrees
Eligibility
Must refinance at least $10,000 in student loans and be a U.S. citizen, permanent resident, or resident alien with a valid U.S. Social Security number. Must have earned at least a bachelor's degree to qualify.
Overview
EdvestinU offers student loan refinancing through Granite Edvance Corporation, a New Hampshire-based nonprofit. The lender stands out with competitive interest rates and flexible repayment terms for borrowers with strong credit. To qualify, you'll need a credit score of at least 700 and an annual income of $30,000 for loans less than $100,000 or $50,000 for larger amounts. However, loans aren't available in all U.S. states.
Unlike many lenders, EdvestinU lets you refinance without a degree or while still enrolled in school. New Hampshire residents also receive a 1.5 percentage point interest rate reduction, making it an excellent option for those in the state.
pros
- You can refinance without a degree or while enrolled in school
- Autopay rate discount available
- New Hampshire residents save 1.5 percentage points on their interest rate
cons
- Refinancing is only available in select states
- High minimum credit score requirement
- Requires a higher minimum loan balance than some lenders
- Cosigner release requires 2 years of on-time payments
Eligibility
U.S. citizens or permanent residents who are at least 18 years old and reside in Alaska, Arkansas, Colorado, Connecticut, Florida, Maine, Massachusetts, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Puerto Rico, Rhode Island, Texas, Utah, Virginia, Washington, West Virginia, and Wisconsin.
Loan Amounts
$10,000 up to the total amount
Overview
Massachusetts Educational Financing Authority (MEFA) is a student refinancing lender offering a wide range of options, including to borrowers who didn't finish school. Though the lender doesn't offer variable-rate options, its fixed-rate loans have competitive rates.
MEFA's mission is to provide affordable student loans, and it doesn't charge any fees. You must have at least $10,000 in student loans to refinance, and you must have made a minimum of six consecutive on-time payments over the last six months. Borrowers who are unable to qualify on their own can add a cosigner to their application.
pros
- You can refinance without having graduated
- Doesn’t charge fee
- Can prequalify to check your rate
cons
- Can’t release a cosigner
- Doesn’t have any discounts
- Can’t refinance parent student loans
- Doesn’t offer variable-rate loans
Loan amounts
$10,000 up to your total debt
Eligibility
Must be a U.S. citizen or permanent resident who is the primary borrower on education debt used to attend an eligible college or university. Must have made six on-time loan payments over the most recent six months. Must have no history of default or delinquency on education debt for the past 12 months and no history of bankruptcy or foreclosure in the past five years.
Overview
The Rhode Island Student Loan Authority (RISLA) is a nonprofit lender offering student loan refinancing to borrowers across the U.S. You can refinance even if you didn't complete your degree, as long as you have at least $7,500 in student loan debt.
What makes RISLA unique is the flexibility it offers borrowers. If you're facing financial difficulties, RISLA provides income-based repayment options to help manage your payments. For added relief, you can access up to 24 months of forbearance, which is more than many lenders offer. If you return to graduate school, you can defer your payments for up to three years, giving you time to focus on your studies without worrying about loan payments.
pros
- Offers income-based repayment
- Generous payment relief options
- You can refinance without a degree
- Get a rate discount when you enroll in autopay
cons
- High minimum income requirement
- No cosigner release option
- Fewer repayment terms to choose from
- Does not offer variable rates
Loan amounts
$7,500 minimum up to of $250,000, depending on degree
Eligibility
Borrower or cosigner must meet credit requirements. Student must be a U.S. citizen or permanent resident and have used original student loans to attend an eligible degree-granting institution.
Should I consolidate my loans or refinance them?
Deciding whether to take advantage of student loan consolidation or refinancing is a big decision. So which should you choose?
Consider consolidation if you don’t want to lose out on federal loan benefits, such as student loan forgiveness, or if you worry your income may decrease and you’ll want to apply for an income-driven repayment plan in the future.
On the other hand, consider refinancing if you have excellent credit and a low DTI. This means you’ll have a better chance at qualifying for a lower interest rate, which could help you save money. However, you should only consider refinancing if you have private student loans or aren’t concerned about losing federal protections.
Meet the expert:
Janet Berry-Johnson
Janet Berry-Johnson has spent over 12 years in accounting and more than five years covering finance. Her work has been featured by The New York Times, Forbes, and Business Insider.
