Student Loan REFI

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Topic Author
rbhgncmp
Posts: 19
Joined: Sun Feb 18, 2018 1:24 am

Student Loan REFI

Post by rbhgncmp » Wed Jun 12, 2019 12:29 pm

58,500 in fed student loans at an average of 5.8% (3 individual loans) Fairly stable job barring something unforeseen. Would I be crazy not to refi through Laurel Road/Earnest for 4.25%? (terms are essentially equivalent) They are also giving me a $500 sign up bonus. Laurel Road includes discharge on death/perm disability, and up to 12 month forbearance. The only real federal safeguards I am losing are income based repayment plan right? Also, the only other con I can think of is that I am about 11 months paid ahead on my federal loan, although I continue to make monthly payments above the minimum. I put a calculator to it and the savings are pretty darn significant. Should I?

lassevirensghost
Posts: 66
Joined: Mon May 07, 2018 5:33 am

Re: Student Loan REFI

Post by lassevirensghost » Wed Jun 12, 2019 12:33 pm

I just refinanced with Laurel Road and am very happy with the result. My average rate before that was just north of 6% (on about $87k) and they got it down to 4.33% for a 10 year fixed. Payment went down noticeably and just feels good to have that much more going to principal instead of interest.

I was at first concerned by the lack of PSLF, but then I am trying to get rid of these things ASAP and am NOT taking the strategy that some seem to be taking, of paying as little as possible and hoping that the gov will pick up the rest.

itsgot8
Posts: 127
Joined: Thu Dec 14, 2017 11:20 am

Re: Student Loan REFI

Post by itsgot8 » Wed Jun 12, 2019 2:32 pm

rbhgncmp wrote:
Wed Jun 12, 2019 12:29 pm
58,500 in fed student loans at an average of 5.8% (3 individual loans) Fairly stable job barring something unforeseen. Would I be crazy not to refi through Laurel Road/Earnest for 4.25%? (terms are essentially equivalent) They are also giving me a $500 sign up bonus. Laurel Road includes discharge on death/perm disability, and up to 12 month forbearance. The only real federal safeguards I am losing are income based repayment plan right? Also, the only other con I can think of is that I am about 11 months paid ahead on my federal loan, although I continue to make monthly payments above the minimum. I put a calculator to it and the savings are pretty darn significant. Should I?
What term length did you have to accept in order to get the 4.25%?

Topic Author
rbhgncmp
Posts: 19
Joined: Sun Feb 18, 2018 1:24 am

Re: Student Loan REFI

Post by rbhgncmp » Wed Jun 12, 2019 2:46 pm

The 4.25% was 10 year term. 7 year was like 4.17% but I'd rather have a lower min payment and pay it off ahead of schedule.

CommitmentDevice
Posts: 57
Joined: Tue Apr 02, 2019 3:25 am

Re: Student Loan REFI

Post by CommitmentDevice » Wed Jun 12, 2019 5:25 pm

Hi OP,
Congrats on working on your student debt and doing due diligence on your options.
I refinanced a loan with SoFi for 5 years at 3% variable. It has been awesome.
I take from this:
  • Thumbs up for refinancing
  • Shop around and explore different time horizons and fixed vs variable to see if you can get a special rate
  • Here is my referral code to SoFi for $100 back sofi.com/share/1576587?src=copy. MisterMoneyMustache had one that got $300 back - worth seeing if that is still available

EasyPeasy17
Posts: 6
Joined: Wed Jun 05, 2019 9:50 am

Re: Student Loan REFI

Post by EasyPeasy17 » Wed Jun 12, 2019 5:36 pm

Refinancing student loans is very easy and straightforward. I refinanced my loans 3 times over 12 months.

You need to apply to multiple companies and then make them compete for your business by taking the lowest offer to the next lowest competitor.

I did this and managed to get a 2.7% fixed 5 year loan from Sofi last year which was lower then any of their published rates.

If you check out the white coat investor he usually has pretty good links to get some cash back.

NativeTxn
Posts: 48
Joined: Mon May 20, 2019 9:32 pm

Re: Student Loan REFI

Post by NativeTxn » Wed Jun 12, 2019 6:43 pm

My Federal loans are all consolidated at 1.875% so no reason to ever refinance those, or pay them off early for that matter other than to have them paid off.

I refi'd a private student loan several years ago with SoFi for 10-years at 4.6% or so. It had been on a variable rate, so I wanted to lock in the fixed rate, as this was around the time rates started increasing.

Fast forward to last month, and I refinanced them over to Earnest for a 5-year term at 3.5% fixed. Payment went up about $50 a month compared to the SoFi loan, but I had nearly 7 years left on the SoFi loan. So, it will knock at least a couple of years off and save interest. There were no origination or other fees associated with doing it, so it seemed like a no-brainer.

I checked into "refinancing" at SoFi, but to do a 5-year loan was going to be a bit over 4%, so the move to Earnest made perfect sense.

As long as you're decreasing the time left to pay the loan off (or at worst, keeping the payoff period the same, but going to a lower rate), and the lender isn't charging any fees to move it, I don't see why it would ever be a bad idea.

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