CommonBond Student Loan Refinance Review 2020: Low RatesStudent Loans
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Regardless of how much you owe, the types of loans you carry, or the interest rates you were given, it’s often in your best interest to consider refinancing your student loans. There are many companies out there offering student loan refinancing. In this CommonBond student loan refinance review, we’ll take a look at one of the most popular options on the market.
What Is CommonBond?
CommonBond is an online lender founded in 2011. It aims to offer affordable loans to current or past students. In less than a decade, the company has funded over $2.5 billion in student loans, making it no stranger to helping you better pay for your education.
The company offers new private student loans as well as competitive loan refinancing options, whether you need to borrow $2,000 or have $500,000 in debt. For most borrowers, CommonBond is worth a look, no matter where you are in your educational journey.
However, where CommonBond really shines is in its refinance loans.
There are many reasons why CommonBond may stand out to you when planning a refi. The company offers flexible options for borrowers looking to lower their monthly payments, reduce interest rates, or even take over responsibility for their Parent PLUS loans.
Interest rates are competitive for most borrowers, and you can choose the loan term that best suits your needs. Plus, you can see your refinance loan interest rate online without even affecting your credit!
Let’s take a look at what a refinance loan through CommonBond looks like from start to finish and see if this lender is the right choice for your own student loan debt.
How to Apply for a CommonBond Loan
Applying for a student loan refinance through CommonBond is simple. All you need is a computer, some personal information, and a few minutes of your time. You can even get pre-approved and see your interest rate without affecting your credit score.
When visiting the refinance page on CommonBond’s website, you’ll see the option to take an easy refi quiz. The results will tell you whether you’re a good fit for refinancing, as well as give you an idea of just how much you could save over the life of your loan repayment by refinancing with CommonBond.
The questions you’re given are pretty basic. The quiz will ask things such as the reason you want to refinance, how much you currently owe, and how many years until payoff. You’ll also be asked about the average interest rate on your existing loans and how many lenders you currently make payments to each month.
Of course, none of these questions are mandatory. You can skip any or all of them and jump straight into your loan application.
When you’re ready to apply for your refi, you’ll need to have some information ready. CommonBond will ask you for things including your:
- Name, address, telephone number, and citizenship status
- Total student loan debt at present (this can be an estimate)
- Pre-tax annual income
- Highest level of education completed
- Social Security number
Even though the quiz will ask for your SSN in order to run the application, this will not affect your credit score. CommonBond will use the information only to verify your identity and provide you with a pre-approved interest rate.
If you decide to move forward with a CommonBond student loan refinance, a hard inquiry will be requested during the final loan process. (This is when the application will appear on your credit report and have a potential impact on your score.)
Refinance Loan Requirements
Before you apply for a refi through CommonBond, you should be aware of the lender’s borrower requirements.
In order to be approved for refinancing, you’ll need:
- To be a U.S. citizen or legal resident
- A bachelor’s degree or higher, from an institution that is eligible to receive federal aid
- A credit score of 660 or higher
CommonBond Loan Options
Refinance loans through CommonBond come in a few different flavors. Which you choose depends on how much you owe, how you plan to repay, and what you can afford in payments each month.
With CommonBond, you’re able to take out a refinance loan ranging from as low as $5,000, all the way up to $500,000. So whether you’re trying to pay off that last remaining loan or need to optimize years of grad school debt, CommonBond has you covered.
CommonBond offers fixed and variable rate loans in five-, seven-, 10-, 15-, and 20-year options. Additionally, there’s a hybrid loan option that’s available in a 10-year term.
The CommonBond Hybrid Loan
The CommonBond hybrid loan is a unique product intended to optimize debt payoff. This loan option is great for borrowers who typically prepay their debt and don’t intend to drag out their repayment to the very end of their schedule.
This hybrid option not only helps you lower your interest rate and monthly payment amount, but also helps ensure that you pay less in interest over the life of your loan.
As mentioned, this is a 10-year loan product. The first five years are offered at a fixed interest rate, guaranteeing rate certainty during the important first half of the loan. However, for the second five years, the loan will switch to a variable interest rate.
This gives borrowers the potential to snag even lower interest rates for the remainder of their repayment term. However, since variable rates are uncertain, this switch occurs only at the tail end of the loan repayment. For borrowers who prepay their debt, this period of time may not be very long, reducing the risk they face while hopefully optimizing the interest paid over the life of the loan.
Interest Rates: How Much Your CommonBond Refi Will Cost
As mentioned, there are both fixed and variable rate options when refinancing through CommonBond. Here’s a look at the rates being offered as of this writing.
|Fixed Rate||Variable Rate||Hybrid|
(current as of 11/12/19)
|3.21 – 6.45% APR||2.02 – 6.30%||4.40 – 6.22%|
CommonBond also offers a 0.25% interest rate discount just for using auto-pay each month.
As mentioned above, you can also opt for the hybrid loan. With this option, your 10-year loan will have a fixed rate for the first five years. Then, it will switch to a variable rate for the remainder of the repayment (however long that takes, up to the remaining five years).
CommonBond Student Loan Refinance Review: Pros
With all of the student loan refinance lenders out there, you might be wondering why you should opt for a company like CommonBond.
Depending on exactly what you owe and how you plan to repay your educational debt, some lenders may be a better choice for you than others. However, with that said, CommonBond does offer a few great benefits that make it a very competitive lender in the market.
Generous Forbearance Policy
None of us plan to lose our jobs, endure a family emergency, or have unexpected medical concerns. However, these are always possible and could possibly make monthly student loan payments a struggle.
At CommonBond, you’ll get up to 24 months of forbearance if it’s ever needed. This period is much longer than what’s offered by most other lenders. It gives you a safety net in case you need to temporarily postpone your monthly payments due to a financial hardship.
For many borrowers, it might be smart (or even necessary) to add a co-signer to their loan in the beginning. This usually results in better approval odds, improved loan terms, and even lower interest rates.
However, later down the line, you may want to release your co-signer from the debt. With CommonBond, this isn’t a problem.
CommonBond will allow for co-signer release in most cases, assuming you’ve met the following requirements:
- You’ve made 24 consecutive, on-time monthly payments including interest and principal
- You’re at least 21 years old
- You have graduated from the degree program associated with the loan
- Your own personal credit report is strong enough to qualify you for the loan on your own
No Prepayment Penalty
Some lenders will penalize you for trying to pay off your student loan debt ahead of schedule. The reason? It saves you — and costs them — money in interest!
This isn’t the case at CommonBond. Here, the lender has no problem with you prepaying your debt as much as your cash flow allows.
Depending on your creditworthiness, you can snag some seriously competitive rates by refinancing through CommonBond. By choosing a variable rate loan, you have the ability to lower your APR even further.
This is the biggest motivator for many loan refinance borrowers, such as Dr. Danielle Plummer of HG Pharmacist, who graduated with $240,000 of student loan debt in 2016. “I used Credible to refinance my loans from pharmacy school and am absolutely thrilled with their service,” says Dr. Plummer.
“All my loans were through the FASFA and ranged from 5.9% to 7.2% in both Grad and Grad PLUS loans… I refinanced using Credible and ended up with a loan through Mohela with a fixed 4.9% over 10 years. I would have saved many thousands of dollars if I had used Credible’s service as soon as I graduated.”
No Origination Fees and No Hidden Costs
You should be wary of any student loan refinance lender that wants to charge an origination fee on the loan. However, they are out there.
When you opt for a CommonBond student loan refinance, you don’t have to worry about any such thing. There are absolutely no fees or hidden costs associated with refinancing your student loan debt.
The only fees you’ll incur with CommonBond include interest charges, possible late payment penalties, and the like. To apply for and receive your new refi loan won’t cost you a dime.
CommonBond Social Promise
Do you enjoy working with companies that focus on giving back? This lender does just that through the CommonBond “Social Promise.”
This promise is designed as a way to give back to others as a force of change. In fact, CommonBond is the very first company to institute a 1-for-1 model within education and finance through its initiative with Pencils of Promise (POP).
For every degree that is fully funded with CommonBond, the lender will fund a year’s tuition for a student in need in the developing world. Through POP, CommonBond has helped develop more than 200 schools and programs in Laos, Nicaragua, Guatemala, and Ghana.
CommonBond Student Loan Refinance Review: Cons
Of course, no lender is perfect. There are a few things you’ll need to keep in mind if you’re thinking about refinancing with CommonBond.
Credit Score Requirement
Of course, any private loan (educational or otherwise) will depend on creditworthiness for approval. CommonBond refinance loans are no exception.
At CommonBond, a credit score of 660 is required before you can refinance your student loans. The benefit is that the company is upfront about the threshold — not all lenders will offer up a minimum score requirement. But of course, this score might be difficult for new graduates in debt to meet.
Refinancing with a co-signer is always an option, as is working to improve your credit before refinancing your loans. However, for many borrowers, the 660 credit score requirement may exclude them from approval.
Bachelor’s Degree or Higher
If you want to refinance your student loan debt through CommonBond, you’ll need to wait until you have successfully earned a bachelor’s degree or higher.
There’s no refinancing available for those with associate’s degrees, which isn’t always the case with refi lenders. Also, you won’t be approved for a CommonBond refi if you took out loans but then didn’t complete your degree program for whatever reason.
Approved Schools Only
In order to snag a CommonBond refi, you must have graduated from an approved institution. While there is no list of approved colleges and universities that we could find, there is the requirement that your school be eligible to receive federal aid.
Applying for a CommonBond student loan refinance is easy, no matter where you are.
By visiting the website, you can take a quick quiz to find out just how much CommonBond could save you on your debt repayment. You can also apply online in minutes, without any impact to your credit score. The lender’s website is accessible from smartphones and tablets, making it simple to initiate the application process from anywhere.
If you want to talk to a real person, you can email CommonBond anytime. You can also call the U.S.-based customer care team Monday through Friday, from 9 a.m. to 6 p.m. EST.
How Does CommonBond Measure Up?
I decided to put CommonBond to the test with my own student loans. I had refinanced some significant educational debt a few years back, opting to go with NavRefi. (Navient was servicing many of my loans at the time, so switching to NavRefi was just easy.)
Currently, I am paying off my student loan balance at a rate of 5.390% APR and am due to satisfy the entire debt in about four more years. I went ahead and entered all of this information into CommonBond’s pre-approval questionnaire, just to see what I was offered.
As hoped, CommonBond was able to beat my current interest rate on three of their fixed repayment options: five-, seven-, and 10-year loans.
However, I was surprised to see that the variable loans offered to me had even higher interest rates. I had fully expected these rates to be notably lower than the fixed loans’ rates, to account for the loss in rate stability.
Overall, the refinance options presented to me by CommonBond were very competitive. Even though I recently refinanced, I would still save money by switching to CommonBond today. Had I not already refinanced those loans, I would be saving substantially more with CommonBond’s refi options.
Choosing a CommonBond Student Loan Refinance
There are many reasons why you may want to refinance your student loans. Whether you’re aiming to get out of debt sooner, lower your monthly payments, or save money on interest — or all three — finding the right lender makes all the difference.
Refinancing through CommonBond seems like a pretty solid option. The website is easy to use, the rates are competitive, and you can get pre-approval without any impact to your credit score.
Refi loan options are aplenty with CommonBond, too. You can choose loan terms from five to 20 years and opt for rates that are variable, fixed, or hybrid. If you ever need loan forbearance, this lender offers you up to 24 months… significantly more than most others out there.
Who Is CommonBond Best For?
If you discontinued your degree program or have an associate’s degree, a refi through CommonBond isn’t right for you. You also should look elsewhere if your credit score is less than 660 and you don’t have a creditworthy co-signer willing to put their name on your debt.
However, if you have a bachelor’s degree or higher from an approved institution, have between $5,000 and $500,000 in student loans, and want to get out of debt faster, CommonBond is worth a look.
To learn more about CommonBond, take the refi quiz, or get a no-impact pre-approval, visit CommonBond’s website here
Stephanie Colestock is a personal finance expert and writer who enjoys teaching people how to be financially independent and confident about their money choices, regardless of obstacles in their path (such as the crippling student loan debt she once held). Stephanie graduated from Baylor University, and is currently working toward her CFP certification. Her work can be seen on sites such as Forbes, Dough Roller, and Johnny Jet, among many others.