Whether you’re looking to pay off your student debt faster or shrink your monthly student loan debt payments, student loan refinance companies can help.
Student loan refinancing involves securing a new loan to pay off some or all of the existing loans you took out to finance your education. You might do this to get the lowest student loan refinance rate, release your cosigner, secure a shorter term, or make monthly payments more manageable.
Whatever your refinancing goal, choose a private lender that offers the lowest rates and benefits that your current lender doesn’t offer.
Start your search with the top 10 best companies to refinance loans with in 2020. All offer competitive rates, excellent loan terms, and perks that make being a borrower a little more manageable.
Our full guide below will cover our top picks, who they’re great for, what perks they offer, what drawbacks you should know about, and some eligibility requirements. At the end, we’ll even answer some of your student loan refinancing FAQs.
1. Rhode Island Student Loan Authority (RISLA)
Great pick for borrowers who want payment flexibility
| Fixed APR: | 3.49-8.14% |
| Available Term Lengths: | 5, 10, or 15 years |
| Min Loan Amount: | $7,500 |
The Rhode Island Student Loan Authority (RISLA) is a non-profit state-based agency that offers student loan refinancing to students across the U.S. This agency only offers fixed-rate products, and you’ll need a minimum income of $40,000 and at least a 680 credit score to qualify.
RISLA gives borrowers one benefit you won’t find with any other private lender—an income-based repayment plan with loan forgiveness after 25 years. An income-based repayment plan sets your monthly payment based on your actual earnings, keeping payments as affordable for borrowers as possible. This provides a security net if you’re concerned about being able to pay off your loans.
Perks: income-based repayment plan, 0.25% autopay discount, no origination fees, no service fees, no application fees, up to 36 months of graduate school deferment, death and permanent disability discharge, military benefits, available with or without a degree.
Drawbacks: no cosigner release program, requires a hard credit check for rate check, late fee equals 6% of the late payment amount, students can’t refinance a parent PLUS loan in their name, limited forbearance policies.
2. Laurel Road
Great pick for medical and dental school refinancing
| Fixed APR: | 2.80-6.00% |
| Variable APR: | 1.89-5.90% |
| Available Term Lengths: | 5, 7, 10, 15, or 20 years |
| Min Loan Amount: | $5,000 |
Laurel Road lets medical and dental school residents refinance their medical or dental loans during residency. Plus, they can pay $100 per month in the six months following their residency or fellowship. Select degree-earning borrowers can use Laurel Road for Parent PLUS loans too.
To qualify for student loan refinancing, you’ll need a minimum credit score of 700. Like many of the other lenders on our list, Laurel Road only runs a soft credit inquiry for prequalification and to give you a rate.
Perks: 0.25% discount for members of the American Dental Association (ADA), $400 refer-a-friend bonus, 6-month post-residency deferment, 12 months of forbearance, no prepayment fees, no origination fees or other upfront fees, cosigner release after 3 years, death or disability discharge
Drawbacks: no academic deferment, only available for select associate degree holders, late fees.
3. Earnest
Great pick for financially responsible borrowers
| Fixed APR: | 2.98-5.79% |
| Variable APR: | 1.99-5.64% |
| Available Term Lengths: | 5 to 20 years down to the month |
| Min Loan Amount: | $5,000 |
Earnest is known for offering flexible repayment plans and fixed or variable interest rates that help borrowers pay off student debt quickly. Its Precision Pricing tool chooses a rate and loan term (down to the month) based on your monthly budget. Their repayment options also let you make extra payments and same-day payments with ease.
Unlike typical lenders, Earnest evaluates your credit score, earning potential, education, and savings when approving applicants. They’re looking for borrowers who regularly save, make on-time payments, and have minimal credit card debt.
If you need help, Earnest’s in-house customer service team is available by call, email, and text.
Perks: 180 different repayment terms, no upfront fees, no prepayment penalties, skip one payment per year, deferment and forbearance options, 0.25% autopay discount, in-house customer service team.
Drawbacks: no cosigners allowed, not available in KY and NV.
4. CommonBond
Top pick for cosigner release
| Fixed APR: | 2.98-5.79% |
| Variable APR: | 1.99-5.61% |
| Available Term Lengths: | 5, 7, 10, 15, or 20 years |
| Min Loan Amount: | $5,000 |
CommonBond refinances loans belonging to those with a bachelor’s degree or higher. This student loan refinancing company wants to see a credit score of at least 660. If your score isn’t high enough, ask a financially responsible relative to help. Let them know that CommonBond offers cosigner release after just 24 months of consecutive, on-time payments.
Plus, when you choose CommonBond, you’re also helping them to cover the cost of a child’s education in Ghana through their Pencils of Promise partnership.
Perks: variable, fixed, and hybrid interest rates available, no origination fees or other upfront fees, no prepayment penalties, 0.25% autopay discount, forbearance and deferment options, death or disability discharge, in-house customer service team.
Drawbacks: not available in NV or MS.
5. PenFed Credit Union
Great pick for married couples
| Fixed APR: | 3.23-5.53% |
| Variable APR: | 2.58-4.98% |
| Available Term Lengths: | 5, 8, 12, or 15 years |
| Min Loan Amount: | $7,500 |
PenFed Credit Union (a.k.a. Pentagon Federal Credit Union) refinances loans for borrowers with at least a bachelor’s degree. Solo applicants need a minimum income of $42,000 and a minimum credit score of 670. You can refinance between $7,500 and $300,000.
Married? PenFed is the only lender that permits spousal refinancing, where a married couple refinances separate educational loans into one new loan. A child can also refinance Parent PLUS loans into their own name with a fixed or variable rate PenFed refinanced loan.
Perks: 12-month cosigner release program, no upfront fees, no prepayment penalties, spousal consolidation loans, borrow up to $300,000, students can refinance Parent PLUS loans.
Drawbacks: no death discharge, not available to non-completers or associate degree holders, no official economic hardship forbearance policy, no autopay discount.
6. Wells Fargo
Great pick for borrowers with existing Wells Fargo Student Loans
| Fixed APR: | 3.74-9.74% |
| Variable APR: | 3.00-8.74% |
| Available Term Lengths: | 5, 7, 10, 15, or 20 years |
| Min Loan Amount: | $5,000 |
Wells Fargo is one of the best banks to refinance student loans with, but only if you already have existing Wells Fargo student loans. With a Wells Fargo refinancing or loan consolidation product, you can combine your Wells Fargo educational loans, any federal student loan debt, and other qualifying educational debt from other private lenders.
To qualify, you’ll need a minimum credit score of 748 or a cosigner with a credit score of 748. Eligible borrowers can refinance $5,000 up to the total cost of attendance, and you can do so regardless of whether you earned a degree.
Perks: available to non-degree holders, 5 repayment term options, dedicated loan advisor, flexible repayment options, no upfront fees, no late fees, no prepayment penalty.
Drawbacks: only for existing Wells Fargo customers, limited forbearance policies, limited cosigner release program.
7. SoFi
Great pick for added perks
| Fixed APR: | 2.99-6.28% |
| Variable APR: | 2.25-6.28% |
| Available Term Lengths: | 5, 10, or 15 years |
| Min Loan Amount: | $5,000 |
American citizens, visa holders, and permanent residents can refinance their federal, private, medical, and dental education loans with SoFi. SoFi offers variable rate loans and fixed rate loans. The rate you receive depends on your credit score, but SoFi doesn’t disclose its minimum credit score. However, you can see if you prequalify in just two minutes; SoFi will just run a soft credit check.
Have Parent Plus Loans? SoFi lets students refinance their parent’s Parent PLUS Loans. Plus, SoFi gives borrowers free career coaching, free financial advisor appointments, entrepreneurship support, and 12 months of unemployment protection.
Perks: no upfront fees, no prepayment penalties, 0.25% autopay discount, deferment and forbearance, in-house customer support team, no minimum income requirement, no late fees.
Drawbacks: no cosigner release program.
8. Education Loan Finance (ELFI)
Great pick for parent loan refinancing
| Fixed APR: | 2.79-5.99% |
| Variable APR: | 2.39-6.01% |
| Available Term Lengths: | 5, 7, 10, or 15 years |
| Min Loan Amount: | $10,000 |
ELFI helps student and parent borrowers across the U.S. and Puerto Rico with student loan refinancing. With ELFI, parents can refinance Parent PLUS loans and private parent loans, students can refinance Parent PLUS loans and other student debt.
This student loan refinance company likes to see a debt-to-income ratio of below 55% and a minimum credit score of 680. You can add a cosigner if you don’t meet the qualifications, but ELFI doesn’t offer cosigner release.
Perks: personal loan advisor, no upfront fees, no prepayment penalties, military deferment, up to 12 months of forbearance, death or disability discharge on a case-by-case basis.
Drawbacks: high minimum loan amount, no cosigner release, must have a degree, no academic deferment, late fees.
9. College Ave
Great pick for associate degree holders
| Fixed APR: | 3.74-8.49% |
| Variable APR: | 3.64-8.49% |
| Available Term Lengths: | Any term between 5 and 20 years |
| Min Loan Amount: | $5,000 |
Did you earn a two-year degree? CollegeAve is one of only a handful of lenders that helps associate degree holders. They’ll even give you a rate based on your combined income if you’re married and your spouse cosigns the loan, which is good since they have a minimum income requirement of $65,000.
CollegeAve gives borrowers a lot of choices when it comes to loan terms too. Choose any loan term between five and 20 years, like seven or eleven years.
This company also permits international students to apply for refinancing so long as their cosigner is a permanent resident or U.S. citizen, but cosigner release isn’t available.
Perks: 16 repayment term options, no prepayment penalties, no upfront fees, 0.25% autopay discount, biweekly payments via autopay, deferment options, and death or disability discharge.
Drawbacks: no cosigner release, students can’t refinance Parent Plus loans in their name, not available in ME, no academic deferment.
10. Citizens Bank
Great pick for those who didn’t graduate
| Fixed APR: | 2.99-8.49% |
| Variable APR: | 1.99-8.24% |
| Available Term Lengths: | 5, 10, or 15 years |
| Min Loan Amount: | $1,000 |
Citizens Bank is another one of the best banks to refinance student loans with. It offers surprisingly low benefits for a “traditional” bank, and perks that compete with the best online-only lenders have to offer. You’ll need a minimum credit score of 680, an annual income of $24,000, proof of employment, and at least $10,000 to refinance.
While many lenders don’t permit associate degree holders or those without a degree to refinance, Citizens Bank does. You just need to show that you’ve made 12 qualifying payments since leaving school.
Perks: 5 loan term options, no upfront fees, no prepayment penalty, cosigner release after 3 years, 0.25% loyalty discount, 0.25% autopay discount, low minimum income ($24,000).
Drawbacks: limited information about forbearance options, need at least $10,000 to refinance.
So, Which Student Loan Refinance Company is the Best?
There isn’t any single “best” student loan refinance company. Everyone looking to refinance has different goals and circumstances. Some need a cosigner while others need cosigner release. One borrower might want protections like death and disability discharge while another prioritizes the lowest student loan refinance rate above everything else. Still, another might want flexible repayment options.
Instead of focusing on finding the “best” companies to refinance student loans, focus on determining your refinance goals and your must-haves for a refinanced loan.
Financial goals for refinancing might include:
- Extending the loan term to make monthly payments more manageable
- Securing a lower interest rate to reduce the overall cost of the loan
- Releasing a cosigner from your current private loan
- Getting new repayment terms and benefits like deferment or forbearance in case of graduate school, unemployment, military deployment, etc.
Use Credible to Find the Right Fit For Your Student Loans
Other companies–like LendEDU–have claimed to operate objectively, but in February 2020, it came to light that LendEDU engaged in a “pay for play” model.
LendEDU accepted money from refinance companies in exchange for giving those companies higher rankings as well as fake positive customer reviews.
Credible’s platform only weighs lenders based on criteria fed into a refinancing algorithm. The company doesn’t accept payment from lenders in exchange for artificially boosting their rankings.
Instead, users can objectively compare multiple lenders and determine which company to work with.
Student Loan Refinance Company FAQS
Refinancing your loans might sound intimidating, but it’s a fairly simple process. Start by determining why you want to refinance. That way, you know what criteria to use when evaluating lenders.
Next, you should determine which loans you want to refinance. Are you refinancing all of your student debt? Only the private loans? Do your parents want you to take ownership of their Parent PLUS loan?
Once you figure that out, calculate the weighted average interest rate of the debt you want to refinance. The weighted average interest rate is simply an average interest rate that accounts for the size of each loan. You’ll use this number to help you determine whether a refinanced interest rate is good enough.
Use this weighted average interest rate calculator to make things easier. Input the loan balance and interest rate for each loan that you’re planning to refinance. Don’t have that information? Visit your loan servicer website.
After completing your calculation, read more about the best refinance companies. Start requesting rates and keep track of which companies offer which rates. If you prefer a simpler process, use a free student loan online marketplace like Credible to do your research and show you rates.
Credible compares lenders for you, showing you your best options based on your financial situation, refinancing goals, and lenders’ products.
Once you have some options, use a student loan refinancing calculator to compare the refinanced loan to your current loans. Make sure the new loan will help you achieve your refinancing goals.
It all depends on your situation, but sometimes refinancing your student debt doesn’t make sense.
For example, when you refinance your federal loans, you’re giving up federal loan benefits like access to forgiveness programs, income-driven repayment programs, death and disability discharge, and COVID-19 relief measures from the CARES Act. Those are all valuable protections that you might need in the future.
Refinancing your private educational debt only has a downside if you don’t do your research and make a smart choice. When you refinance, pick a lender that offers exactly what you need, whether that’s deferment options, a lower interest rate, a longer term, or cosigner release.
If a lender doesn’t offer better terms or better rates than your current loan, hold off on refinancing until it’s worthwhile.
Each lender has its own criteria, but in general, all educational loans are eligible for refinancing. You can refinance a single loan or multiple loans into a new refinanced loan.
Eligible loans include:
- Federal Stafford/Direct loans
- Federal Parent PLUS loans
- Federal Grad PLUS loans
- Direct Consolidation loans
- Federal Perkins loans
- FFEL loans
- HEAL loans
- Private educational loans
While it is possible to refinance both private and federal loans together, it’s not always a good idea.
Given the relief measures provided by the CARES Act, now is not a good time to refinance your federal student loans and your private loans together. The CARES Act suspended payments on qualifying federal educational debt backed by the Department of Education and dropped interest rates to zero. You won’t find a refinanced loan that can beat those federal loan benefits.
You’re better off only refinancing your private loans for now.
Whether or not you can transfer your Parent PLUS Loans to your kids depends entirely on your lender. Some private student loan refinancing companies like SoFi and PenFed let children refinance Parent Plus Loans in their own names. Others, like CollegeAve and RISLA, don’t allow it.
When evaluating your different refinancing options, only look for lenders that offer the transfer.
Looking solely at interest rates, now is an excellent time to refinance your private educational debt. Rates are extremely low. However, that doesn’t mean it’s a good time for everyone. Consider your job stability carefully and prioritize lenders with perks like unemployment forbearance.
A good student loan refinance rate is generally any rate that’s lower than the weighted average interest rate of the loans you’re looking to refinance.
For example, if your weighted average interest rate is 5.5%, aim for a refinanced loan that’s at least under 5.5%. A website like Credible makes seeing rates from multiple lenders easy, so you can quickly narrow down your best refinancing options and find a rate that’s lower than your current weighted average interest rate.
Most lenders automatically include any AutoPay interest rate reduction in their advertised rates. Keep that in mind in case you don’t plan to use AutoPay.
To really ensure you’re getting a good deal, use a refinancing calculator to compare the new loan terms and interest rate to your current loan(s).
Secure the lowest student loan refinancing rate possible by:
- Shopping around and comparing different lenders
- Improving your credit score
- Finding a creditworthy cosigner
Right now, student loan interest rates, including refinancing rates, are some of the lowest we’ve seen. While it’s impossible to predict for certain how interest rates will behave,–especially during a global pandemic–we do know this: rates are unlikely to increase in the near future.
In June 2020, the Federal Reserve announced they would keep the federal funds rate between 0 and 0.25% until the economy strengthens. Private lenders look to this rate when setting their own, so it’s likely private refinance rates will stay low for the foreseeable future.
You’ll need a credit score in at least the 650 to 680 range to refinance your student debt. However, it all depends on the lender. If you want the best rates, aim for an excellent credit score in the high 700s.
Refinancing with a cosigner is the easiest way to refinance private debt with bad credit. If a cosigner isn’t an option, you’ll need to cast a wide net. Apply to a large number of lenders (within a two-week time frame) with the hopes of finding one with less stringent requirements.
Your next best move will be to focus on repairing your credit. Simple steps like negotiating to have late payments removed, paying off credit cards and personal loans, and making your loan payments on time can quickly give your score a boost.
Refinancing involves taking out a new loan and a hard credit inquiry, so it will affect your credit score. However, if you’re smart about it, refinancing will only cause minimal damage.
A lender may offer a soft credit pull to give you a rate estimate, but they’ll need to run a hard credit pull to approve your application. A hard credit pull shows up on your credit report, impacting it negatively.
Follow these tips when seeking rates and applying to keep credit score damage to a minimum.
- Prioritize lenders that give rate estimates with only a soft credit inquiry
- Only fill out a small number of actual applications
- Apply to all of your options within two weeks to minimize the number of credit inquiries that show up on your report
Along with being smart about the application process, you also need to stay current on your payments. Just because you’re in the process of refinancing doesn’t mean that you stop making required monthly payments. If you fall behind, the late payments will show up on your credit report.
Refinancing educational debt that’s currently in default isn’t usually possible. Letting a loan fall into default wrecks your credit score, and you need a solid credit score to be approved for refinancing. Plus, some lenders have policies against refinancing defaulted loans.
If you have loans that were in default but have since been consolidated or rehabilitated, you may still be able to refinance those. It will depend on the lender you choose and how well you’ve repaired your credit score since the default.
Other factors refinance lenders look at include your total loan balance, your current income, your personal finance habits, your credit history, and your credit score.
