Student Loan Refinance Calculator
Whether you’ve been paying off your student loans for six months or six years, refinancing your student loans could seem like a good idea. You could save hundreds or thousands of dollars, but it’s not for everyone. A student loan refinancing calculator can help you determine how much you can save. Once you have an idea of the APR and terms available to you from lenders, you can input those new terms, plus your current loan terms, into the calculator — from there, you can see how your monthly payment, total interest costs and payoff period will change.
When to refinance your student loans
Refinancing your student loans might be a good idea if:
- You're eligible: If you have a solid credit score and a steady job, you may qualify for an interest rate that’s lower than what you’re paying now.
- You’d save money: It’s a good idea to refinance your student loans if you would either save money each month or lower the total interest costs of your loan.
If you don’t qualify for refinancing — whether you have poor or little credit — or you won’t get an interest rate lower than what you’re paying now, you may want to look at alternatives. For federal student loan borrowers, refinancing also means that you lose out on federal protections and benefits. For instance, if you ever need to pause payments, many private lenders don’t offer deferment or forbearance like federal student loans do. If you refinance your federal loans, you'll also lose the ability to sign up for an income-driven repayment plan.
Should you refinance student loans during COVID-19?
The global pandemic has brought on a host of financial issues for people across the world. However, refinancing rates have plummeted during the recession, allowing many Americans to secure lower interest rates than what they were paying before. Refinancing right now might be a good idea if:
You’re financially secure. Millions of Americans have lost their jobs or face reduced hours. When you take out a new loan through refinancing, you’ll need to prove that you can pay it back. As you complete your application, you’ll be asked about your current employment. If you can’t prove that you can repay your loan, you might not get approved.
You have private student loans. Federal student loans are under forbearance through Sept. 30, 2021, which suspends payments and interest rates. If you refinance those loans, you lose access to this benefit.
You want to simplify your student loan payments. If you have many different loans, refinancing will give you a new loan and repay all your old loans. From there, you’ll make one payment to your new loan. Refinancing gives you one payment, interest rate and monthly due date.
How to refinance your student loans
1. Review your credit history
2. Shop around
3. Choose a lender and complete an application
- Proof of employment.
- Driver’s license or another form of ID.
- Loan information.