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Average interest rates on refinanced student loans are mostly flat or slightly down from two weeks ago, according to Credible. The exception is the rates on five-year variable undergraduate loans, which increased 1%.
Rates are up since last year, and they’re likely to continue climbing. Federal student loan rates for 2022-23 will increase by the most in 17 years. These new rates won’t have a direct impact on private student loan rates, but private rates may rise as they don’t have to remain as low to be on par with federal loan rates.
Insider’s Featured Student Loan Refinance Companies
Variable: 2.49% – 8.24%, Fixed: 4.24% – 8.49%
Variable: 2.49% – 11.97%, Fixed: 2.59% – 8.74%
Variable (with autopay discount): 2.49% – 7.99% APR, Fixed (with autopay discount): 3.74% – 8.49% APR
5-year variable student loan refinancing rates
Undergraduate rates have risen substantially from last week, rising by 1%. They’re more than 3% higher than they were last year.
The rates on graduate loans have dropped by 39 basis points in the past week and are now around 3.41%.
10-year fixed student loan refinancing rates
Rates on 10-year fixed loans have remained roughly flat over ther past week.
Undergraduate rates have gone down by 4 basis points, and graduate rates have dropped by 2 basis points.
Student loan interest rates by credit score
Your interest rate will often improve with a better credit score — we show this in the table below. We’re giving you the 10-year fixed student loan rates by credit score:
Frequently asked questions
No, you won’t be eligible for any type of loan forgiveness if you refinance your federal student loans. President Joe Biden in August said the government will forgive up to $10,000 in student debt for borrowers making less than $125,000 per year, and as much as $20,000 for Pell Grant recipients. Married couples or heads of households who make less than $250,000 will also qualify for forgiveness.
All types of federal loans will qualify for forgiveness, but private student loans aren’t included.
While refinancing federal student loans might seem like a good idea if you’re getting a better interest rate, doing so will disqualify you from loan forgiveness — both widescale and through programs like Public Service Loan Forgiveness.
Refinancing your student loans Coyle get you a lower rate. You can also change from a fixed-rate to a variable-rate loan, or change your term length. Picking a new term length can allow you to distribute costs over an extended period for smaller monthly payments, though you’ll pay more in total interest.
The best barometer of loan approval is usually your credit score and history. Lenders like to see a track record of reliably paying back your loans on time. The better your credit score, the more likely you are to qualify for a low rate. Additionally, most lenders will run a soft credit check when you apply, which doesn’t affect your credit score. That way you can find out from an individual lender if you’ll get approved at no harm to you.
A five-year loan term could be a great choice if you want a better interest rate and you’re able to pay off your loan that fast. You’ll save money in interest and will free up money to put toward your other financial goals more quickly.
A 10-year loan term will cost you more overall, but you’ll make smaller monthly payments. This may make it easier for you to repay your loan if you’re on a tight budget.