Refinancing student loans can have several benefits, but not all. Here’s what you should consider before refinancing Sallie Mae loans.
How Can I Refinance Sallie Mae Student Loans?
If you have Sallie Mae student loans, you can refinance them with Sallie Mae or another private student loan company that offers refinancing loans. You can start the refinancing process by searching and comparing student loan refinancing interest rates and other conditions.
Many lenders allow you to pre-qualify before applying. Prequalification does not require a tough credit check, so it will not affect your credit rating, but it can give you an idea of whether you have a good chance of getting approved and what the terms and conditions of your loan might be.
Once you find a suitable lender, you apply. If you are approved and you accept the loan offer, the lender will pay off your Sallie Mae student loans and you will start making payments to the new lender in the future.
When should I refinance my Sallie Mae student loans?
Here are some reasons you might want to refinance your private student loans from Sally Mae:
- You are entitled to a lower interest rate than what you are paying now.
- You want to shorten the repayment period and pay off the loan faster.
- You are in financial difficulty and want to upgrade to a longer maturity.
- You’ve had a bad experience with Sally Mae and want to refinance with a lender who has good customer service.
- You are a parent who borrowed money on behalf of your child and you want to transfer the debt to them.
Think carefully about your situation and why you are thinking about refinancing. Also keep in mind that refinancing is best to wait until you have a solid credit rating and income. While the minimum credit score requirements for refinancing can be around 600, for example, a higher credit score will give you the lowest rates.
The prequalification process can give you a good idea of what you are eligible for based on your current credit status and income.
What are the benefits of refinancing?
Refinancing a Sallie Mae student loan can have a positive effect on your student loan repayment plan. Here are some of the main benefits you might like:
- Lower interest rates: You may be able to qualify for a lower interest rate, which will help you save hundreds or even thousands of dollars on your loan. Refinancing is a particularly good idea if you have a variable rate but want to lock in a fixed rate when interest rates are low.
- Payment flexibility: If you want to speed up the repayment or shorten the payment for a longer period, you cannot shorten or extend the repayment period with your existing lender. When refinancing a student loan, you can choose a repayment period of five to 20 years, depending on the lender. Whether you want to pay off debt ahead of schedule or extend the term to lower your payment, refinancing will allow you to make that choice.
- Various functions: Each lender has its own set of features that borrowers can take advantage of. If you find a lender that offers benefits that you don’t get with Sally Mae, refinancing and transferring your debt to a new lender can give you access to what you are looking for.
- Debt relief: If you are a parent who borrowed to help your child go to school, some refinancing lenders allow you to transfer this debt to your child. Both parties will need to agree and your child will need to be able to take on the debt on their own. Otherwise, you may need sign a loan applicationbut it can still be a good way to remove responsibility for payment.
Refinancing Sallie Mae loans can give you the opportunity to save money, gain a little more control over your repayment plan, and take advantage of features that you may not currently have. To determine if refinancing your loans is a good idea, start by looking at your current student loan refinancing interest rates and compare the characteristics of Sally Mae with those of other lenders.