If you thought refinancing your private student loans, now is the best time for that. Student loan refinancing rates set a new all-time low for the week since June 14 based on an analysis of borrowers with credit ratings of 720 and above who refinanced their student loans on the online marketplace Credible.
The interest rate on 10-year fixed rate loans fell to 3.50%. This is below the previous record low of 3.57% last week and almost a full percentage point lower than a year ago, when it was at 4.44%.
Borrowers who choose a five-year variable rate loan can receive an interest rate of 2.88%, which is the lowest interest rate for this type of loan for the whole of 2021. It fell from 2.92% a week earlier.
To get the lowest rate on your private student loan, it is important to choose between several lenders. You can compare real student loan refinancing offers on Credible for free without affecting your credit score.
Is it time to refinance student loans?
The decision to refinance a student loan depends on the type of loan and the interest rate on it. Currently deprecated refinance federal student loansas you may lose protections such as repayment in line with income, patience with difficulties, and even possible student loan forgiveness in the future.
However, if you have private student loans, now is the time to get a lower rate on your college debt. Refinancing rates for student loans on Credible have steadily declined in the past year, setting record lows in mid-June.
Check out the rate table below where you can see the rates offered by real student loan lenders. If you are looking to refinance private student loans, you can pre-qualify for Credible to compare estimated interest rates through several lenders.
How to know if a student loan refi is right for you
You should consider refinancing your private loans if you can secure a lower interest rate than what you are currently paying. Since there are no fees when refinancing a student loan, such as closing expenses when refinancing a mortgage, it is easier to determine how much money you can save.
Student loan borrowers who took out private loans just a few years ago were paying much higher interest rates than they can currently claim. Average interest rates for those who took out private student loans on Credible for year ended 13 May 2018 were much higher:
- 7.64% for a 10 year fixed rate loan
- 6.17% for a 5-year floating rate loan
A hypothetical borrower who took out 10-year private student loans at a fixed rate for 10 years in May 2018 at 7.64% made monthly payments of $ 358. Assuming timely payments are made within three years, the borrower can refinance the remaining $ 17,112 into a new 10-year fixed rate loan at 3.50%, cutting monthly payments by nearly $ 200.
See how much you can save on your college debt by listing current and new loan terms in Student loan repayment calculator Credible…
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