Refinancing your student loans can provide significant benefits as you work to pay them off. Depending on the situation, you could qualify for lower interest rates and monthly payments or simply get more flexibility with your repayment schedule.

While some of the top student loan refinancing companies are online lenders, you can also refinance your college debt with banks and credit unions. Here’s what you need to know about some of the top credit union student loan refinance options.

Refinancing your student loans: Credit unions vs. other lenders

Choosing a lender to help you refinance your student loans is an important decision. Not only will it impact your interest rate, but it could also change your repayment term, fees and other aspects of the experience.

Credit unions can provide you with benefits that other lenders might not offer, but they can also come with some drawbacks to consider.

Pros of refinancing with a credit union

  • Credit unions typically charge lower interest rates and fees than traditional banks.
  • Credit unions traditionally serve specific communities and may have a better grasp on their needs, whether it’s a local community or a national one like the military.
  • Credit unions may offer better service because they have a smaller customer base.
  • You can often earn discounts on your refinancing loan if you already have a financial product managed by the credit union.

Cons of refinancing with a credit union

  • Credit unions may have lower limits on how much you can refinance.
  • Credit unions may have less flexible repayment options.
  • You may have to be a member of the credit union before you can apply.
  • Refinancing loans from credit unions are usually more expensive than those from online lenders.

4 credit unions that refinance student loans

If you’re interested in refinancing a student loan with a credit union, it’s best to start your search with a local credit union, but don’t stop there. One of these four credit unions could be a good fit for student loan refinancing.

First Tech Federal Credit Union

With First Tech, you can refinance federal or private student loans, including parent PLUS loans. The lender offers loans ranging from $5,000 to $500,000, depending on the type of loan you choose and your repayment term.

Repayment options are five, seven, 10 and 15 years, and you can choose from three loan options:

  • Fixed-term loan: This is a traditional loan with a fixed interest rate and fixed monthly installments.
  • Balloon loan: With this loan, you’ll start with low monthly payments then make a lump-sum payment after 15 years.
  • Interest-only loan: You’ll pay just the interest on this loan for one to 10 years. After that, your monthly payments will grow over time.

The balloon and interest-only loan options are marketed to professionals who expect to earn much more down the road, but they come with higher interest rates and more complicated repayment terms.

Benefits include a 0.25 percent discount on an auto loan if you apply within 30 days of refinancing your student loans and 10,000 bonus points if you open a First Tech Choice Rewards World Mastercard credit card.

To join First Tech, you must have a family member who is already a First Tech member, work for a partner company, work or live in Lane County, Oregon, or belong to the Computer History Museum or Financial Fitness Association.

Navy Federal Credit Union

Navy Federal Credit Union is unique in that it allows only qualified members of the military community to join. If you qualify based on those requirements, you can refinance federal or private student loans, including parent loans.

You can borrow as little as $7,500 and up to $125,000 for undergraduate debt and $175,000 for graduate debt. Repayment terms are five, 10 and 15 years. Interest rates are competitive, and you can get a 0.25 percent rate discount if you set up automatic payments.

If you’re a parent, you can combine student loans you took out for more than one child into one refinance loan. And if you need a co-signer to get approved, you’ll have the ability to remove them after making 12 consecutive on-time payments and meeting certain credit requirements.

To qualify, Navy Federal requires a monthly income of $2,000 or more and an established credit history of 21 months or more. If you have a co-signer, your income can be as low as $100 as long as theirs is $2,000 per month or more.

PenFed Credit Union

Pentagon Federal Credit Union offers nationwide student loan refinancing to college graduates and their parents. The lender is unique in that it allows spouses to combine their student loans into one new loan. You can borrow between $7,500 and $500,000, with repayment terms of five, eight, 12 and 15 years.

Unlike other credit unions that offer student loans, PenFed is transparent about its credit requirements. The lender has a minimum credit score of 670 and a minimum annual income of $25,000.

If you’re borrowing up to $150,000 and your credit score is under 676 or your annual income is less than $42,000, you’ll need a co-signer. Your co-signer will need a credit score of at least 720 and an annual income of at least $42,000.

If you’re borrowing more than $150,000 and your credit score is under 725 or your annual income is less than $50,000, you’ll also need a co-signer. In this instance, your co-signer will need a credit score of 725 or higher and an annual income of at least $50,000.

If you need a co-signer, you can request to release them from the loan after you’ve made 12 consecutive on-time payments and can meet certain credit criteria.

Service Credit Union

Service Credit Union offers student loan refinancing for college graduates and their parents, with the option for parents to transfer student loan debt to their child

Loan amounts range from $5,000 to $150,000, and you can repay over five, 10 or 15 years. Like Navy Federal, Service Credit Union primarily serves the military community, but you can join by becoming a member of the American Consumer Council or by working for one of Service Credit Union’s select employer groups.

The lender doesn’t provide information about credit requirements to get approved to refinance your student debt, though you will need to have at least a bachelor’s degree.

How to find the best credit union to refinance your student loans

As with any other financial decision, it’s important to take your time and shop around to ensure that you find the best deal. Compare these options with other credit unions in your area that offer student loan refinancing. You may also consider using a platform like LendKey, which connects borrowers with credit unions and community banks.

If you’re not married to the idea of refinancing only with a credit union, you may also consider comparing rates and other terms with online lenders and banks. But if you prefer to work with a smaller organization, stick to credit unions.

If you have a loved one who is willing to co-sign a loan application with you, that can help drive down your interest rates. Unfortunately, not all credit unions allow you to get prequalified with just a soft credit check, so you may have to go through the full application process to be able to compare rates and terms.

Next steps

Refinancing your student loans can save you money and provide you with some extra flexibility. Going through a credit union could give you a better experience as a customer, and in some cases, you may be able to score a lower interest rate. But be sure to keep the potential limitations in mind.

Whether you decide to refinance your student loans with a credit union or another type of lender, the important thing is to be proactive about your student loan repayment and the different ways you can save money along the way.

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