Private student loan refinancing can help you save money and make your student loans easier to manage by bringing multiple loans under one lender. To help you understand when refinancing may be the right move, we reviewed dozens of student loan refinance companies to find the best with low rates, borrower protections, important features, and more.
Before you decide on a lender, consider multiple offers to make sure you're finding the right fit. Loan aggregators make comparing options even easier. If you’re looking for that experience, our partner Credible allows you to find and compare multiple loan offers in one place.
Best Student Loan Refinance Companies of 2021
|Lender||Why We Picked It||Fixed APR|
|CommonBond||Best Overall||2.83%-6.74% with autopay|
|Earnest||Best Overall Runner-Up||2.98%-5.79% with autopay|
|Citizens Bank||Best With No Degree||2.97%-8.34% with autopay|
|SoFi||Best for Graduate Students||2.99%-6.09% with autopay|
|PenFed Credit Union||Best for Parents and Co-Signers||2.99%-5.15%|
|Splash Financial||Best for Married Couples||2.63%-6.25% with autopay|
|Discover||Best for Borrower Protections||3.49%-6.99% with autopay|
|College Ave||Best for Flexible Repayment Options||3.34%-6.19% with autopay|
CommonBond: Best Overall
CommonBond offers some of the lowest interest rates on refinance loans up to $500,000. It offers fixed rates from 2.83% to 6.74% APR and variable rates from 1.97% to 6.82% APR. CommonBond also provides a “hybrid rate” option that offers variable rates for the first five years and then a fixed rate for the remaining five years. Hybrid rates range from 4.05% to 5.55% APR. All rates reflect what you could potentially qualify for after getting a 0.25% rate discount.
CommonBond’s forbearance period of up to 24 months is the longest potential forbearance period of any lender we surveyed. It also allows co-signers, and provides an option to release them after making 36 consecutive on-time payments.
You can even refinance student loans your parents took out to pay for your college expenses and change ownership of those loans to yourself. CommonBond observes the grace period deferment for recent graduates. You can choose from five loan terms, too.
Hybrid rate loan option
Option to transfer parent student loans to the student
Long forbearance period of up to 24 months
Applicants who didn’t graduate are ineligible
Refinancing isn’t offered in Nevada or Mississippi
Read the full review: CommonBond Student Loans
Earnest: Best Overall Runner-Up
Earnest offers competitive interest rates and a few good features. Variable rates range from 1.99% to 5.64% APR and fixed rates range from 2.98% to 5.79% APR (after signing up for autopay and receiving a 0.25% discount). Repayment of loans between $5,000 to $500,000 is also fairly flexible with Earnest. You have the ability to make biweekly or monthly payments and customize your loan term between five and 20 years. Also, you can request to skip a payment once every 12 months, or apply for up to 12 months of forbearance if you face a financial hardship, too.
Parent PLUS refinancing option
Ability to potentially skip a payment every 12 months
May match current grace period deferment, up to nine months
Deferment of up to 36 months for students returning to grad school at least half-time
You must complete a degree by the end of the semester in order to refinance
Doesn’t accept co-signers for student loan refinancing
No option to transfer ownership of a student loan
Not available in Kentucky and Nevada
Read the full review: Earnest Student Loans
Citizens Bank: Best With No Degree
Many lenders will only consider student loan refinancing applicants who have already graduated—but not all. Citizens Bank is one of the lenders that accepts and considers student loan refinancing applications from borrowers who don’t hold a degree.
To refinance through Citizens Bank without a degree, you must have already made 12 payments on your student loans. Forbearance is allowed for up to 12 months when going through a financial hardship. If you decide to return to school to complete a degree, you can qualify for in-school deferment on refinanced student debt.
Loan amounts range start at $10,000 and max out at $300,000 for bachelor's degrees and below, and up to $500,000 for graduate degrees. Loan terms range from five to 20 years.
Student loan refinancing variable rates start from 1.99% to 8.09% APR and fixed rates range from 2.97% to 8.34% APR after signing up for autopay and receiving a 0.25% discount. You will lose your discount if you have three returned payments in a 12-month period.
Students with an associates or no degree may qualify
Ability to add co-signer
No option to transfer parent student loans to the child
Read the full review: Citizens Bank Student Loans
SoFi: Best for Graduate Students
SoFi is the best option for graduate students and those who have recently completed a professional degree. This lender has no official limit on how much it can refinance (as long as it’s more than $5,000), which could make it a smart option if you want to refinance a large student loan balance.
SoFi offers variable rates that range from 2.25% to 6.09% APR, and fixed rates from 2.99% to 6.09% APR (with 0.25% autopay discount). Loan terms range from five to 20 years. You can learn more about what rates may be available to you with SoFi and compare offers from multiple lenders at Credible.
SoFi has a refinancing option specifically for medical and dental school grads that sets monthly payments at $100 during residency. Variable rates range from 2.50% to 7.04% APR and fixed rates range from 3.24% to 7.04% APR (with autopay).
Specific options for medical and dental school grads
Ability to add a co-signer
Complimentary member benefits like career coaching and unemployment protection
No co-signer release for refinanced student loans
Read the full review: SoFi Student Loans
PenFed: Best for Parents and Co-Signers
Parents or co-signers who own debt for a student’s education might be wondering how student loan refinancing works for them. PenFed Credit Union offers some flexible features perfect for parents or co-signers.
When refinancing parent student loans, you can choose to keep these in your name or transfer ownership to the student for whom you borrowed the loans. PenFed also accepts applications with a co-signer, and will consider a co-signer release after just 12 months of on-time, consecutive payments, which is less than other lenders on our list.
Also, you’ll get competitive interest rates. Variable rates range from 2.19% to 4.49% APR, and fixed rates range from 2.99% to 5.15% APR. Loan amounts range from $7,500 to $300,000, with loan terms of five to 15 years.
Ability to transfer ownership of parent student loan to the child
Can refinance student loans with a spouse
Apply to release co-signer after just 12 months
Co-signers must earn at least $42,000 per year to qualify
No formal forbearance or deferment policy (case-by-case only)
Must become a PenFed member to apply
Splash Financial: Best for Married Couples
Splash Financial offers a unique feature that can be helpful to married couples looking to manage student debt together. Splash works with lending partners who may be able to combine both your and your spouse’s loans together into one refinanced student loan. You can opt to transfer ownership of student debt from one spouse to the other, too.
The student loan refinance rates offered through Splash are competitive, too. Variable rates range from 1.89% to 6.68% APR and fixed rates range from 2.63% to 6.25% APR (includes 0.25% autopay discount). Loan terms range from five to 20 years for loan amounts of $5,000 or more.
Ability to combine or transfer student debt as a married couple
Medical and dental school refinancing options available
Borrower protections like forbearance and deferment vary by lending partner
Some credit union partners may require membership to qualify
Discover: Best for Borrower Protections
If you refinance a student loan and then have a life change or hardship that complicates your repayment, Discover has several safeguards in place to help.
Discover’s deferment can pause your payments for up to five years at a time to allow a borrower to return to school, serve in the military, work at a public service organization, or complete a health care residency. Forbearance can suspend payments for up to 12 months in cases of unemployment, a medical disability, excessive student loan burden, or other financial hardship. Discover also offers a reduced payment option that could drop your monthly payments to $50 for up to six months.
Discover offers refinancing only to borrowers with $150,000 or less in total student loans.
Discover provides just two student loan refinancing terms, so you must choose between a 10- or 20-year repayment period. Loan amounts start at $5,000. Discover offers variable rates ranging from 1.87% to 5.87% APR and fixed rates ranging from 3.49% to 6.99% APR (after signing up for autopay and receiving a 0.25% rate discount).
Refinance student loans while you're still in school
Multiple deferment options offered
Reduced payment option
Just two loan term options
No co-signer release
Read the full review: Discover Student Loans
College Ave: Best for Flexible Repayment Options
In some cases, you may want to refinance student loans to get a monthly payment that fits your budget—without stretching out your repayment too long. Lenders that offer more loan terms can help you find the closest match to your budget and pay-off goals.
College Ave Student Loans’ refinancing options include 16 different loan terms, ranging from five to 20 years, for loans of $5,000 to $150,000 (most degrees) $300,000 (medical and vet doctorate degrees). It also offers competitive rates. Variable rates range from 3.24% to 6.04% APR and fixed rates range from 3.34% to 6.19% APR (after signing up for autopay and receiving a 0.25% rate discount).
Higher $300,000 refinance limit for medical, pharmacy, dental, or veterinary degrees
Sixteen different loan term options
Stringent co-signer release option
No info on deferments or forbearances available on website
Read the full review: College Ave Student Loans
What Is Student Loan Refinancing?
Through student loan refinancing, you apply for a loan with a private lender that will pay off and replace your existing student loans. Going this route could allow you to change or modify the terms of your loans, provided you find the right lender.
A common reason you may choose a refinance is to replace higher-interest student debt like Direct PLUS loans or private student loans. If you have decent credit, income, and other financial strengths, a lender could approve you for student loan refinance rates that are lower than what you’re currently paying.
Student loan refinancing can have other benefits, too. You might want to refinance to remove a co-signer from a private student loan,or transfer ownership of parent PLUS loans.
How Do You Apply For a Student Loan Refinance?
First, shop around with different lenders to find one that offers a good rate along with features you’re looking for.
You can request rate offers from lenders that offer pre-qualification or rate quotes based on soft credit checks. This will tell you if you’re likely to get approved and what rates the lender could offer you without affecting your credit.
Next, start your application to refinance student loans once you find a lender you like. You'll likely need to provide identity-verification information such as your Social Security number and pay stubs.
Then, review and sign your loan agreement. If the lender approves you, it will send you a loan agreement outlining the full terms of the refinance. Make sure you read it carefully, and, if you have questions, ask your lender.
Lastly, the lender will process the refinance. To do so, it’ll cut checks to send to each of your old lenders to pay off the student debt you refinanced. Keep making payments to those other lenders until you’re absolutely certain the refinance has gone through.
Once the previous lenders are paid off, you'll make payments to your new lender under the terms of your refinance agreement.
You don’t have to refinance all of your student debt. It might make sense to refinance only your higher-interest student loans.
Refinancing Federal Student Loans vs. Private Student Loans
Both student loan consolidation and refinancing combine multiple loans into a single loan with a single payment. That’s about where the commonalities end for student loan refinancing and consolidation.
Refinancing federal student loans with a private lender is a significant change, and borrowers should carefully weigh their options before deciding to take this step.
Consolidation vs. Refinancing
Federal Student Loan Consolidation
Consolidation typically refers to federal student loan consolidation, which combines your federal student loans into a single loan account.
A consolidated loan’s interest rate is a weighted average of your existing student loans, so it’s not an option to lower interest costs. However, federal consolidation will preserve access to federal student loan protections and repayment options like deferment, forbearance, and income-driven repayment.
So, instead of getting one rate based on your financial profile like you would through a student loan refinance, you’re getting a weighted average.
Private Student Loan Refinance
Student loan refinancing, on the other hand, is offered by private student lenders. Unlike federal student loan rates that are set by law, lenders set their own rates—which can beat what borrowers might pay on federal student debt if you have good enough credit scores.
Private Student Loan Refinance Pros and Cons
Combine federal and private student loans
Lower interest rates
Change monthly payments
Modify student debt ownership
Choose your new lender
Credit-based application and rates
Not every borrower will pay less
Limited deferment and forbearance
Lose federal student loan benefits
Fixed repayment terms
The only way to consolidate your federal and private student loans together to get a simple, single payment is through refinancing. A new refinanced student loan can come with lower costs, especially if a borrower has higher-interest federal student debt.
A lower interest rate will generate less student loan interest, which means lower monthly payments. You can also choose a longer term, which will lower monthly costs, or a shorter term, which would cost more each month but get you out of debt faster. You can refinance student loans to change who’s legally responsible for them by adding a co-signer or removing a co-signer. And you can transfer parent-owned debt such as the parent PLUS loan to the student child.
You don’t get to choose your loan servicer when you consolidate your federal loans. If you’re unhappy with your federal student loan servicer, refinancing can give you the power to choose a lender you like.
Refinancing may only be an option if you have decent credit or better, a steady income, and other solid financials. Your credit will also be used to set your interest rates. If you don’t have excellent credit, you might not qualify for rates that beat what you’re already paying. It’s also up to lenders’ discretion to offer borrower protections like deferment or forbearance that can help you avoid default.
However, private student loans lack the income-driven repayment plans that federal student loans offer. Also, unlike federal student loans, private loans don't offer loan forgiveness. And, finally, many federal student loans offer three years of forbearance and three years of deferment, whereas most private lenders provide 12 months of forbearance. Shorter payment relief options mean you have less leeway if you incur a long-term income or job loss.
How Does Student Loan Consolidation Work?
Consolidating federal student loans is a pretty straightforward process. The Federal Student Aid website says you should do the consolidation in a single sitting of about 30 minutes. Here’s how it works for student loans in good standing:
- Start the federal direct consolidation loan application, and enter your borrower information.
- Select the loans you do and don’t want to consolidate, and select your desired repayment plan.
- Sign a promissory note for your new direct consolidation loan, agreeing to repay it.
- Your student loan servicer will process this application, and complete the student loan consolidation.
- You’ll start repaying the new consolidated loan within 60 days of when it is disbursed.
Your new student loan will have the same balance as your previous loans, as well as a new rate that’s set as a weighted average of your existing rates.
Consolidating loans can also be a way to convert student loans that are ineligible for certain federal benefits into a new direct consolidation loan that might be eligible. Make sure you understand the eligibility requirements for the federal student loan program you’re interested in to be sure consolidation is right for you.
How Should I Choose a Student Loan Refinance Lender?
Refinancing student loans can be a big step. You want to be sure it will actually help you achieve your financial goals rather than set you back. The best way to ensure your student loan refinance has a positive impact is to choose the best student loan provider.
First, you should consider the costs of refinancing student loans. Collect rate quotes from at least a few private lenders, and compare these to each other as well as your current rates. This will help you figure out whether you could save money by refinancing your loans.
Next, survey lenders to figure out which ones offer what you need. If you’re refinancing to accomplish a specific purpose, such as taking over repayment of parent PLUS loans, you’ll need to know which lenders allow it. Or, if you’re planning to add a co-signer to get a lower rate, find out if the lender offers co-signer releases. Lenders that offer forbearance or deferment are also preferable, too, because they can suspend your payments while you’re facing a job loss or financial hardship.
How We Chose the Best Student Loan Refinancing Companies
We surveyed 20 student loan refinancing companies to find those that offered the lowest borrowing costs (lack of fees and low interest rates). Then, we selected lenders that provide unique features that can help you achieve your student loan refinancing goals.
CommonBond. "Frequently Asked Questions." Accessed Jan. 12, 2021.
CommonBond. "Student Loan Refinancing Rates and Terms." Accessed Jan. 12, 2021.
CommonBond. "Forbearance—What It Is, and What CommonBond Offers." Accessed Jan. 12, 2021.
CommonBond. "What You (and Your Cosigner) Need to Know After College Graduation." Accessed Jan. 12, 2021.
Earnest. "Can I Refinance My Current Earnest Student Loan Refinance Again?" Accessed Jan. 12, 2021.
Earnest. "What Is the Minimum and Maximum Student Loan Balance Earnest Can Refinance?" Accessed Jan. 12, 2021.
Earnest. "Get Your Rate in Two Minutes." Accessed Jan.12, 2021.
Citizens Bank. "Once I Refinance, Can I Postpone Payments if I Go Back to School or Lose My Job?" Accessed Jan. 12, 2021.
Citizens Bank. "Education Refinance Loan." Accessed Jan. 12, 2021.
SoFi. "Refinance Student Loans - Rates." Accessed Jan. 12, 2021.
SoFi. "Medical Resident Refinance." Accessed Jan. 12, 2021.
PenFed Student Loans. "Legal Disclosures." Accessed Jan. 12, 2021.
PenFed. "Co-Signing and Refinancing." Accessed Jan. 12, 2021.
Splash Financial. "FAQ." Accessed Jan. 12, 2021.
Splash Financial. "Disclaimers." Accessed Jan. 12, 2021.
Discover. "Deferment Options." Accessed Jan. 12, 2021.
Discover. "Student Loan Repayment Options." Accessed Jan. 12, 2021.
Discover. "Private Student Loan Consolidation; Refinancing." Accessed Jan. 12, 2021.
College Ave. "Student Loan Refinancing." Accessed Jan. 12, 2021.
Office of Federal Student Aid. "Student Loan Consolidation." Accessed Jan. 12, 2021.
Nelnet. "Postpone Your Payments with Deferment or Forbearance." Accessed Jan. 12, 2021.
Federal Student Aid. "Student Loan Consolidation." Accessed Jan. 12, 2021.
Federal Student Aid. "Direct Consolidation Loan Application." Accessed Jan. 12, 2021.