Refinancing?

[pharmacita0101]

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Hi all. I'm wondering how beneficial is loan refinancing? I've read and heard mixed things about it. I have several different loans at varying rates. Would refinancing help me pay them sooner without? Also what are the fees commonly?

Also what's your experience with consolidation?

Sorry for all the questions...just want to chose the best path to get rid of this debt. Thanks in advance.

 

[awval999]

There are many threads on this topic here.

DRB, Common Bond, SoFi are some companies that do it.

I refinanced with SoFi from 6.8% to 4.74% 5 year fixed. In hindsight I probably should have went with a variable rate since I'm paying them off aggressively. Saved like $5000 in interest over the full amortization of the loan.

You WILL LOSE any of that loan forgiveness stuff if you think you may be eligible for it.

SoFi was very easy to work with. All electronic.

 

[bacillus1]

I did SoFi. My interest rate went down a percent or so. I calculated that I will save about 2k (since I only had about 50k loans left and am paying it off pretty aggressively). I am not worried about losing federal benefits, since my workplace assists with loan repayment.

 

[confettiflyer]

If you have equity in a home & cannot deduct student loan interest, consider utilizing a HELOC/HEL. I think prevailing rates are ~4.25% right now, but they tend to be variable and take some time to obtain vs. one of the lenders outlined above (still a preferred method).

One word of caution is if you are looking at a longer time frame to pay off - you lose many of the generous protections (assuming you currently have a federal student loan) that may be useful. If you have a long time frame AND are new in your career, it might be a defensive move to keep the current loan and wait to refinance to stricter terms.

The secondary risk is an increased interest rate at a later time, but current market conditions indicate low interest rates are likely to persist.

 

[pharmacita0101]

Thank you all. I don't think I'm eligible for any loan forgiveness programs so no problem there. I'll look more into Sofi today

 

[MatCauthon]

First Republic has the lowest rates by far. However, First Republic also requires a minimum balance checking account with $3k in it (not a problem if you use this as your checking account).

DRB is slightly higher than First Republic but had no minimum balance when I refinanced. I got a 3.5% fixed rate a couple years ago. Sure beat 6.8%

 

[owlegrad]

I did DRB. Haven't regretted it yet. Cut the interest about in half as I recall.

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