What is student loan refinance?
Student loan refinance enables you to refinance or replace your existing student loans with a new, lower-rate loan. However, one need to have a strong credit and a steady income, or access to a co-signer in order to qualify for the same.
Why you should go for student loan refinance ?
As interest rates hovering around at a historically low level. This presens the right opportunity to refinance your debt as interest rates are going to increase from here on. Also, one can find at present a 30 year fixed rate mortgages as low as 3.37%. Further, one can potentially reduce its interest rate by half under the prevailing interest rate environment, depending where or when they have originally taken up student loan.
Below are top 6 picks for student loan refinance
Interest rate comparison for student loan refinance among top 6 picks
Things you should keep in mind before opting for student loan refinance
- Calculate potential savings: Despite huge potential savings claim by refinance companies, you should be extra careful with student loan refinance. First and foremost you should check what is the lowest possible refinance rate you would get. For this, you may need to apply with different lenders and ascertain best interest rate you will get from the lenders. Comparing the interest rate you are getting and your current rate of interest you can calculate You can calculate the savings by using an online student loan refinance calculator. Click here to calculate
- Would you qualify for the loan: Refinance companies are highly selective towards individuals whose loan they will refinance. Majority of lenders will undertake refinancing of your loan, if you graduated from college and have robust credit score. Plus, you have healthy cash flow or income level. Further, your application is most likely to be rejected if you have any past of financial difficulties or have a lot of missed payments on your credit report.
What are risk associated with student loan refinancing?
Before embarking on the path to get your student loan refinanced one should should carefully view three big risks of student loan refinance.
- Result in forfeiting of government protection:
- Your application may get rejected
- You will become ineligible for any new government programs on student loans
Hope above article on student loan refinance helped you in making your decision on opting for refinancing of your loan. You can visit our student loan section to see more tips on student loans.