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The student loan financial crisis is the worst it’s ever been, with the average student graduating with more than $30,000 in student loan debt.
Students that go on to graduate programs end up with even more debt.
Student loan debt can impact your ability to finance a car, purchase a home, and even retire on time.
With interest rates as high as 10% or more on student loans, these debts can take decades to pay off, if they can even be paid off at all.
If you’re struggling to keep up with your student loan payments, student loan refinancing may be the right solution.
In our guide, we’ll show you how refinancing works and the top five tools you can use to refinance your student loans.
Why Consolidate Your Student Loans
Refinacing is ideal if you have multiple loans that you need to manage.
When you consolidate your loans, your multiple loans are combined into one loan to manage.
This way, you can focus on one monthly payment, at a typically lower interest rate.
Your new lender pays off your old loan and issues you a single, new loan for the total balance that they paid off.
There are two forms of consolidation: federal loan consolidation and private loan consolidation.
Federal loan consolidation consolidates your federal loans at a weighted-average interest rate. It allows you to keep your federal student loan payment plans and benefits.
While it may not lower your monthly payment or interest rate, refinancing your federal loans through the federal loan consolidation program makes it easier to manage your loans.
Private loan consolidation can help you save money on your loans by lowering your interest rate while also lowering your monthly payment.
Rather than restructuring your loans at a weighted-average, your new lender completely pays off your loan and issues you a new one at an entirely new interest rate.
If you’ve been working on your credit, a loan consolidation may result in a lower interest rate, helping you pay off the loan much faster.
LendingTree is a leading student loan consolidation provider. It works by matching borrowers with lenders that offer the best rates on student loan refinancing.
The site offers student loan origination, personal loans, credit cards, and most importantly, student loan refinancing.
In addition to student loan options, LendingTree provides free resources to help you understand and manage your loans.
These resources include articles, videos, and worksheets to help you manage your finances and pay off your loan strategically.
How Does LendingTree Work?
Signing up for LendingTree takes just a few minutes.
You can even check your consolidation interest rates without signing up, and without an impact on your credit score.
Rates for variable loans are between 2.46% and 9.56%, while fixed interest rates are between 3.09% and 9.99%.
If you have student loans with high interest rates and have been working on your credit, there’s a good chance that you’ll be matched with a lender in LendingTree’s network offering a lower interest rate on your consolidation.
When your credit isn’t its best, you’re still not out of luck.
LendingTree also specializes in student loan refinancing options that don’t require a cosigner.
These specialized loans help borrowers without cosigners manage their student loans by offering special refinancing programs.
Check your rate without hurting your credit score on LendingTree today.
Credible partners with up to eight lenders to find you the best rates on your student loan consolidation.
You can refinance your private loans, as well as your federal and ParentPlus loans, allowing you to save money and restructure your payment plan on all of your loans to make loan management much easier.
Credible also offers student loans, personal loans, credit cards, and even mortgage refinancing options.
You’ll get instant results when you apply, making it simple, straightforward, and stress-free to refinance your student loans.
Get matched with top national lenders and get competitive interest rates by signing up for Credible today.
How Does Credible Work?
Before you even fill out an application, Credible makes it easy to understand your potential interest rate and loan terms.
In addition to checking your rate for free without an impact on your credit score, Credible has a table that compares the eight partner lenders, showing their interest rates and loan terms.
Interest rates start at just 2.47% and terms range from 5 years to 20 years, giving you the power and freedom to take back control of your student loans.
Simply fill out the application with your personal and financial information, and Credible will run a credit check to match you with lenders.
In just a few minutes, you’ll get real rate offers and loan terms that you can choose.
If you need help during the refinancing process, Credible has a team of experts ready and waiting to help you understand how to consolidate your loans.
SoFi is a full-service financial management company that started out as a student loan refinance provider.
It’s one of the largest and most successful refinance companies in the United States, matching borrowers with lenders that offer extremely competitive rates.
With over 250,000 borrowers who have refinanced through SoFi, and over $18 billion in loans refinanced to date, SoFi is recommended by over 98% of its users.
SoFi also offers medical and dental school refinancing, mortgages and mortgage refinancing, financial management services, personal loans, and even life insurance.
Check your student loan refinance rates without hurting your credit score on SoFi.
How Does SoFi Work?
You can prequalify for student loan refinancing in just a few minutes without impacting your credit score.
When you submit the prequalification form, you’ll be given a list of lenders, the range of rates they offer, and the loan term in years, giving you a snapshot of what you can save.
SoFi presents its refinancing offers by interest rate and by loan term, showing you how much you can save per month or in interest over the life of the loan.
Depending on your goals, you can make lower monthly payments or pay off your loan faster with shorter loan terms and lower interest rates.
Once you select your loan offer, upload your financial documents to finalize your selection.
Your documents are verified in just a few days and your old loan is paid off completely before your new loan is issued.
See why so many people recommend SoFi for student loan refinancing by signing up today.
4. Student Loan Hero
While the name sounds like it only provides student loans, Student Loan Hero provides a wide range of financial products apart from student loans and student loan refinancing.
Rather than directly applying for student loan refinancing through Student Loan Hero, the site is a comprehensive resource on all things student loans.
It provides high-quality reviews, recommendations, and financial advice.
Student Loan Hero works with a network of lenders refinance both federal and private loans, as well as ParentPLUS loans.
You can browse personal loan options, personal loans for those with bad credit, mortgages, and credit card offers, as well as an impressive lineup of financial resources and calculators.
Take advantage of countless free resources to help you make the best decision on your student loan refinancing by signing up for Student Loan Hero.
How Does Student Loan Hero Work?
As we mentioned, you won’t be able to apply for loan refinancing directly through Student Loan Hero.
However, it is a fantastic tool to help you with your research, calculations, and student loan concerns.
This makes Student Loan Hero the perfect place to start your refinancing journey.
On the Products page, you can browse student loan refinance options and link out to each lender’s site. This makes it easier than ever to understand your options and streamline your application.
Use the robust selection of calculators to understand your payment terms, and take fun quizzes to learn more about student loan refinancing.
The final tool on our list that you should consider using when you consolidate your student loans is LendKey, a leading student loan refinance provider.
By partnering with credit unions and local banks, LendKey connects borrowers with financial institutions that offer some of the lowest possible refinance rates.
In addition to student loan refinancing, you can apply for home improvement loans and utilize free loan resources on the LendKey site.
How Does LendKey Work?
Much like the other providers on our list, you can check your refinance rates on LendKey with no impact on your credit score.
This allows you to see just what you may qualify for without committing to an application.
Rates are as low as 2.57% and terms range from 5-15 years.
In addition to partnering with some of the leading national lenders, LendKey is unique in the fact that they partner with local banks and lenders as well.
This way, LendKey can give you even more options for your consolidation, often at even better interest rates and terms.
Lock in your low rates with local lenders by signing up for LendKey today.
Is Student Loan Consolidation Right for Me?
Over 40 million Americans carry student loan debt, with quite a few of those borrowers behind on payments or in default completely.
If you’re struggling with your payments or have too many loans to manage, consolidation may be a good option for you.
The goal of refinancing your loans is to help make your loans easier to manage with a single monthly payment. It can also potentially lower your interest rate or monthly payment amount.
Rates that are upwards of 10% or more can make it nearly impossible to pay off large student loans.
Avoid getting behind on your student loan payments at all costs, as even one late payment can have serious impacts on your credit score.
Before you fall behind, consider a loan consolidation to get your finances back on track.
Federal Loan Considerations
Carefully weigh the pros and cons of refinancing your federal student loans with a private lender, as you’ll likely lose your federal student loan benefits if you do that.
These benefits include flexible payment terms, student loan forgiveness after working in eligible career fields, and the federal loan consolidation program.
If you have private student loans, or even Direct Unsubsidized loans with high interest rates, consolidating your loans may save you thousands of dollars in interest over the life of the loan.
Honest lenders will tell you what benefits you may be giving up if you refinance your federal loans, and private loans with high interest rates can be refinanced at rates as low as 2.5%.
Making the Most of Consolidation
The best thing you can do for your consolidation is to do thorough research and shop around for the best rates.
If you check your rates on all of our recommended sites above, you can compare rates with potentially hundreds of lenders. This will give you the freedom to find the best possible rates and terms for your loans.
Paired with vast networks of lenders, these sites also provide comprehensive tips and resources when it comes to student loans, mortgages, personal loans, credit cards, and so much more.
Do you have experience refinancing your student loans? Let us know how it went in the comments!
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