September 18, 2014

Refinance Student Loans with

If you have student loans then its likely you're paying 6.8% or more in many cases.

Social Finance or is one option to refinance your student loans.

They advertise variable rates starting at 2.66% and fixed rates starting at 3.625%.    That will beat a lot of peoples current student loan rates.   However the rates are based on your credit and  profile so it could be higher.   They cite maximum rates of 5.285% variable or 7.740% fixed which are still better than a lot of private loans.

But it won't work for everyone.   They only loan to students from certain schools and you do have to have decent credit.   You also must be employed or have a current job offer.   And you must currently reside in one of the eligible states.   Their list is most states but its NOT available in Alabama, Delaware, Idaho, Mississippi, Montana, Nevada, North Dakota.   I have not been able to find specifics of the criteria like credit score or a list of schools on the Sofi website itself. 

Sofi says you must be a graduate of "a selection of Title IV accredited universities or graduate programs".  Thats not specific at all.   I found one reference to them lending to grads of about 100 schools but that was about a year ago and they may have expanded the number.   I found a list of eligible schools at a 3rd party site, but I don't know if its current or accurate.  The list of schools looks legit though but again it may be out of date.   Since Sofi's model has been to deal with schools that have low default rates so you could generalize that only the better schools are likely to be covered    (sorry University of Phoenix grads).   You can look up default rates by school at this site and if your school is very higher then they may not be covered or you may be offered a higher interest loan.

Note I don't have any specific information on how Sofi decides to approve loans or determine rates. 
I'm inferring some from descriptions of their business model mostly.  

The downside to doing a refinance is that you lose access to programs like the government IBR and loan forgiveness.  So thats something to consider.     You might not get great terms from Sofi either.  I've read reports of people with credit scores in the high 700's and good paying jobs getting offers of 6% loans, which isn't all that great.

But if you do have high interest student loans then looking into might be worth your while.


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