Is Your Credit Score Above 650? Refinance Student Loans Now and Save

Sara Cantu

According to the Federal Reserve, U.S. student loan borrowers owed more than $1.67 trillion in federal and private student loan debt as of June 2020. This is an intimidating figure, even for the optimistic graduate. 

When facing financial difficulties, many borrowers contemplate different ways how to save on student loans. If you are a current college student or a recent graduate who is currently drowning in student debt, you may be wondering what your options are.

There are multiple factors to consider when searching for ways to save money on student loans. If you are searching for how to lower student loan rate, one of the best ways to do it is through student loan refinancing. 

How to save on student loans

We are living in troublesome financial times. Everyday expenses like rent or mortgage, phone bills and electricity can take a toll, and that’s before you factor in other bills like your student loan repayment.

But there’s good news. If you have a credit score of 650 or more, refinancing your student loans may be able to significantly improve your financial situation and save you big money on lifetime interest.

Whether you are hoping to save money on interest or make a much-needed change to your student loan repayment terms, student loan refinancing can help you do it. Student loan refinancing is a common answer when borrowers consider how to save on student loans. 

Why is credit score important for refinancing?

Building up a good credit score isn’t always easy. A variety of factors go into a credit score, including payment history, debt-to-income ratio, and the length of time your accounts have been open. If you have made some unfortunate financial decisions in the past, a score of 650 may be out of reach for you. But there is time to turn it around.

There is a reason why so many borrowers strive for a good credit score. The truth is that keeping a high credit score can unlock the potential for strong financial health now and in the future. With a high credit score, you’ll have demonstrated to lenders that you are a trustworthy borrower. This comes with its own unique set of benefits.

If you have been working hard at building your credit score and have settled at a score of 650 or more, you have access to unique opportunities not afforded to every borrower.

For example, you may qualify for extremely low interest rates, or lenders may let you borrow more money than someone who has a low credit score. It’s important you take advantage of low interest rates in order to set yourself up for a bright financial future.

Student loan refinancing is just one way to lower student loan rates. Exploring student loan refinancing sooner rather than later can put you on the road to a debt-free lifestyle faster than you might have anticipated.

How to refinance your student loans

The first step in the process of student loan refinancing is determining the reason behind why you want to refinance in the first place. This is key because determining why you want to refinance can help you develop the right plan when it comes to making this major financial move. The clearer you are about your goals, the more focused your plan will be.

Different borrowers may have different reasons for refinancing. For instance, perhaps you are currently paying much more than you wanted to in interest each month. If this is true, your ultimate goal for refinancing might be to lower your interest rate. You can then begin shopping online for the lowest interest rate available for someone with your credit score. Or maybe you are currently drowning in debt and can no longer afford your monthly student loan repayments. By refinancing, you can lower your monthly payment and start allocating more of your budget toward other necessary expenses. 

There is also the possibility that you have too many monthly payments to keep track of, especially when dealing with multiple student loan lenders. Refinancing is a good way to consolidate your student loan debt into one monthly payment. This has helped many borrowers simplify their financial lives.

The 4 Best Companies to Refinance Student Loans

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Fixed Rate

4.83% – 7.64% APR 4

Variable Rate

3.99% – 7.24% APR 4
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Fixed Rate

4.49% – 8.99% APR 3

Variable Rate

5.09% – 8.99% APR 3
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Fixed Rate

4.47% – 8.99% APR 2

Variable Rate

4.14% – 8.94% APR 2
Loans Available in All States but Maine and Oregon

Fixed Rate

6.94% – 11.58% APR 5

Variable Rate

Not Offered

How can I qualify for the lowest student loan refinance rates?

Keep in mind that just because you have a credit score of 650 or more does not mean that you automatically qualify for student loan refinancing. Several qualifications must be met in order to start the process. For example, you will need to have steady employment and income to prove to lenders that you can keep up with your new student loan repayments. Don’t forget to consider this when coming up with ways how to save money on student loans.

How to refinance your student loans through Purefy

Like any other major financial move, figuring out how to save money on student loans requires weighing your options to ensure you make the best possible decision.

And Purefy is here to make that process easy and fast with our marketplace of top refinance companies.

With a 2-minute rate check, you can save time comparing real pre-qualified rates from our hand-picked selection of the best lenders.

Simply fill out some quick information and see your best rates all at once and in one place – with no impact to your credit and zero fees.

Why refinance student loans and save money

Student loan refinancing has helped countless borrowers achieve their financial goals sooner.

Whether you are seeking to save money on interest, relieve yourself of some of your current financial stress, or pay off your debt sooner, refinancing your student loans can help you achieve one or several of your financial goals.

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Student Loan Refinancing

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ELFI Rate Disclosure

4 ELFI Rate Disclosure:

Education Loan Finance is a nationwide student loan debt consolidation and refinance program offered by Tennessee based SouthEast Bank. ELFI is designed to assist borrowers through consolidating and refinancing loans into one single loan that effectively lowers your cost of education debt and/or makes repayment very simple. Subject to credit approval. See Terms & Conditions. Interest rates current as of 01/01/2023. The interest rate and monthly payment for a variable rate loan may increase after closing, but will never exceed 9.95% APR. Interest rates may be different from the rates shown above and will be based on the term of your loan, your financial history, and other factors, including your cosigner’s (if any) financial history. For example, a 10-year loan with a fixed rate of 6% would have 120 payments of $11.00 per $1,000 borrowed. Rates are subject to change.

SoFi Rate Disclosure

3 SoFi Rate Disclosure:

Fixed rates range from 4.49% APR to 8.99% APR with a 0.25% autopay discount. Variable rates from 5.09% APR to 8.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.

Earnest Rate Disclosure

2 Earnest Rate Disclosure:

Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.72% APR to 9.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 4.39% APR to 9.19% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.

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ISL Rate Disclosure

5 Iowa Student Loan Rate Disclosure:

Fixed Rate Loan Terms: 5 years/60 monthly payments, 7 years/84 monthly payments, 10 years/120 monthly payments, 15 years/180 monthly payments, or 20 years/240 monthly payments. Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. This rate is expressed as an APR. Fixed APRs range from 6.94% to 11.58% APR [low to high range with 0.25% auto-debit rate reduction]. Rates are subject to change without notice. Fixed rates will not change during the term. Since there are no fees associated with this loan offer, the APR is the same percentage as the actual interest rate of the loan including a 0.25% auto-debit rate reduction. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. All estimates are based on information provided by you and are for informational purposes only, accuracy is not guaranteed and may not reflect actual rates or savings and do not constitute an offer of credit. Your actual rate, payment and savings may be different based on credit history, actual interest rate, loan amount, and term, including your cosigner [if applicable]. If applying with a cosigner, we use the higher credit score between the borrower and the cosigner for approval purposes. All loans are subject to credit approval.

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