For borrowers with federal or private student loans, student loan refinancing can effectively save money, pay off their debt faster and simplify their payments.
While refinancing rates are higher than previously — they reached historic lows in 2020 — refinancing may still be advantageous if you have high-interest student loan debt. Continue reading to learn about current interest rates and what you can do to secure the best student loan refinance rates.
What Is Student Loan Refinancing?
Student loan refinancing is a term that refers to a process where you combine your existing student loans into one loan with a new lender. Student loan refinancing can be a smart way to save money and pay off debt faster, particularly for borrowers with high-interest debt.
You can refinance both federal and private debt, including the following types of student loans:
- Federal Family Education Loans (FFEL)
- Federal Direct Subsidized loans
- Federal Direct Unsubsidized loans
- Federal Grad PLUS loans
- Federal Parent PLUS loans
- Private undergraduate loans
- Private graduate or professional loans
- Private parent loans
Tip: By refinancing your loans, you transfer them to a private lender. So while you can refinance federal loans, carefully consider whether you may need federal loan benefits in the future; once you refinance, the process cannot be undone.
Current Student Loan Refinancing Interest Rates
 | Sofi | Earnest | Laurel Road | |
|---|---|---|---|---|
| Fixed Rates APR | 5.48% - 8.94% | 5.24% - 9.99% | 4.96% - 9.79% | 5.24% - 10.99% |
| Variable Rates APR | 5.28% - 8.99% | 6.24% - 9.99% | 5.49% - 9.74% | 4.99% - 10.89% |
| Loan Terms | 5, 7, 10, 15, or 20 years | 5, 7, 10, 15, or 20 years | 5 to 20 years | 5, 7, 10, 15, or 20 years |
| TrustPilot Score | 4.8 | 4.7 | 4.7 | 3.1 |
| NerdWallet Rating | 4.5 | 5.0 | 5.0 | 5.0 |
| US News Rating | 4.7 | 4.6 | 4.8 | 4.6 |
Rates and scores in this chart were obtained from lenders’ and aggregators’ websites on 10/13/2023. All information and rates are subject to change at any time. Please see each lender’s website for current information.
How To Compare Student Loan Refinance Providers
To find the best refinancing option for you, consider the following factors when researching lenders:
- Interest rate types: When you refinance your loans, lenders allow you to choose between variable and fixed interest rates. Variable rates can be appealing because they’re usually lower than fixed rates. However, they can change over time. By contrast, fixed rates never change, so you know exactly what rate you’ll pay over the life of your loan.
- Annual percentage rates (APR): The APR is a percentage that refers to how much you’ll pay in interest and fees over a year; the higher the APR, the more you’ll pay in interest charges.
- Term options: Term periods vary by lender, but you can usually choose a term between five and 15 years. Longer terms will give you smaller payments, but the lender will charge a higher interest rate, and you’ll pay more over time. Opt for the shortest term you can afford to get the lowest student loan refinance rates.
- Credit and income requirements: Refinancing loans are issued based on your credit and income. In most cases, you need to have good to excellent credit and a full-time job or a credit-worthy co-signer to apply with you to get a loan.
Benefits Of Student Loan Refinancing
There are four major benefits to student loan refinancing:
1. Lower Your Interest Rate
Refinancing loans are credit-based, so the lender looks at your credit history, current debt, and income to determine your eligibility for a loan and what rates you’ll receive. If you’re employed and have good credit, you could qualify for a lower interest rate than you have now. With a lower rate, you could save a substantial amount of money.
2. Reduce Monthly Payments
When you refinance, you may qualify for a lower rate or change your loan term to a longer repayment period. With either approach, you could reduce your monthly payments and improve your cash flow.
3. Combine Multiple Loans
You likely took out several student loans to pay for your education, and they all may belong to different lenders and loan servicers. By refinancing your debt, you combine all of your loans into one easy-to-manage account, and you’ll only have to remember to make one monthly payment.
4. Remove Co-Signers
The majority of private student loans are co-signed. Co-signing a loan is a big responsibility, so refinancing is one way to remove a co-signer from the loan. If you meet the refinancing lender’s requirements on your own, you can remove the co-signer from the loan.
What Credit Score Do You Need to Refinance Student Loans?
When refinancing student loans, lenders will require a specific minimum credit score along with other eligibility requirements to qualify. The minimum credit score to refinance student loans can vary by lender. For ELFI, you must have a credit score of at least 680 to refinance. Learn more about the eligibility requirements to refinance student loans.
Pre-Qualify and Get Your Student Loan Refinance Rate With ELFI
If you’re interested in taking advantage of low student loan refinancing rates, ELFI has a quick application and approval process for refinancing your student loans. Best of all, you can pre-qualify to see your estimated rate in minutes without affecting your credit score. Some benefits of student loan refinancing with ELFI* include:
- Competitive student loan refinance rates
- No application, prepayment, or origination fees
- Fixed & variable rate refinance options
- Personal Loan Advisors to guide you through each step of the process
Find out what student loan refinance rate you can qualify for by pre-qualifying with ELFI and submitting your application.*
