While engineers work hard to earn their degrees, the payoff is worthwhile. The average entry-level salary for engineers is $80,490, and the average salary across all experience levels is $92,077. Your salary will vary depending on the engineering field you choose, as well. Computer hardware engineers are among the highest-paid, with a median salary of $138,080.
Engineering students are often top candidates for student loan refinancing because of their low debt-to-income ratios. Here are a few more reasons you might consider refinancing your engineering student loans:
Benefits of Student Loan Refinancing for Engineers
Student loan refinancing can help engineers better manage and repay their student loan debt. On average, graduates with a bachelor’s degree have $38,375 in outstanding federal debt. That figure climbs higher for borrowers with advanced degrees—$94,141, on average.
When you refinance your engineering student loans, a private lender “purchases” your debt from your original lenders. Ideally, you’ll end up with a lower interest rate or a better term when you refinance. And fortunately, many private lenders let you request rate quotes to get a better sense of the rates and terms you might qualify for. Choosing a lower-rate loan means you’ll pay less in interest over your term.
Here are just a few of the benefits of refinancing your engineering school loans:
- Ability to consolidate student loans into one monthly payment
- Option to choose between fixed and variable student loan refinancing interest rates
- Chance to earn a lower interest rate, potentially lower than federal student loans
- Opportunity to change your student loan repayment term
How to Refinance Engineering Student Loans
Comparing refinance offers from different lenders is an important step in the process, and doing so has very few downsides. Most lenders prequalify applicants using a soft credit check, which won’t hurt your credit score. And prequalifying allows you to see potential loan offers from different lenders, including estimated rates and available terms. When you formally apply for a loan after comparing options, your lender will do a hard credit check.
Here are some next steps if you’re thinking about refinancing your engineering student loans:
- Figure out which how much or which loans you’d like to refinance.
- Make sure you meet student loan refinancing eligibility requirements.
- Shop around and compare pre-qualified rates from multiple lenders.
- Submit an application to refinance your student loans
- Finalize your loan by reviewing its terms and signing the documents your lender provides.
Alternative Ways to Pay Off Engineering Student Loans
If student loan refinancing doesn’t seem like the right fit, you have plenty of alternatives to explore. From student loan assistance to student loan forgiveness, engineers might qualify for a variety of repayment options.
Student Loan Forgiveness for Engineers
Select engineers may qualify for Public Service Loan Forgiveness (PSLF). If you qualify, you’ll make payments for a specified amount of time, normally 10 years, then the remaining balance will be forgiven. You will, however, still have to pay taxes on the forgiven amount.
Here are two ways in which engineers may qualify for PSLF:
- Working for a non-profit, government agency, or other eligible employers could provide loan forgiveness after 120 payments (10 years)
- Working as a teacher could provide up to $17,500 in loan forgiveness if you work at a low-income school or another eligible agency
If you aren’t sure which is right for you, research student loan refinancing vs. PSLF. While both may help decrease your debt, it’s important to know how they compare before taking the next steps.
Learn More: Applying for PSLF? Here’s How the OBBB May Impact You
Income-Based Repayment Plans
If you don’t qualify for PSLF, you may also choose to pursue an income-based repayment plan. This type of plan sets a monthly payment as a percentage of your income. Income-based repayment may be a good fit for entry-level engineers still working toward higher salaries.
There are a few types of income-based repayment plans available to engineers, though some will be phased out due to new legislation. The Department of Education will also introduce a new repayment assistance plan (RAP). But currently, here are your options for income-based repayment:
- Pay-as-You-Earn (PAYE): PAYE plans are based on a percentage of your adjusted gross income and family size. This plan will be phased out over the next three years.
- Income-Contingent Repayment (ICR): Many individuals who can’t qualify for PAYE or IBR plans apply for ICR. These start as a percentage of your adjusted gross income, then grow as your income grows. This plan will also be phased out over the next three years.
- Income-Based Repayment (IBR): IBR plans require you to be experiencing financial hardship. If you qualify, they are based on a percentage of your adjusted gross income and family size.
Learn More: How the “One Big Beautiful Bill” Impacts Repayment Plans
State-Based Student Loan Assistance Programs
Engineers are highly valued in the professional world. Some states and private organizations have created student loan repayment assistance programs for STEM professionals, with the goal of encouraging students to pursue these careers.
If you’re an engineer looking for student loan assistance, here are a few examples of state-driven programs you may be eligible for:
Employer Student Loan Repayment Assistance Programs
Some employers provide student loan repayment assistance as a job benefit, which operates similarly to a 401(k). You designate a certain dollar amount to your student loan payments each month, and your employer matches your contribution up to a cap amount. These types of benefits can help improve employee retention rates while supplying necessary financial aid.
Refinance Your Engineering Student Loans with ELFI
If you’d like to refinance your engineering student loans, ELFI can help. By refinancing your engineering student loans with us, you’ll enjoy benefits like:
- No application fees
- No origination fees
- No penalty for paying loans off early
- Referral bonus program for approved borrowers
See how much you could save by refinancing your engineering student loans with ELFI by trying our Student Loan Refinance Calculator.
