Refinancing private student loans is an option. Sometimes, students can refinance with their current private student loan lender or choose to go with a different company.
You can refinance federal student loans. However, you can’t refinance through the federal government. Instead, you have to use a private student loan if you want to refinance federal loans.
With federal loan consolidation, the interest rate is determined by calculating a weighted average of your student’s current federal loan interest rate. They won’t end up with a lower rate overall. However, their repayment terms might be extended.
The first step your student needs to take is to research lenders to find the best student loan refinance option for them. Along with favorable terms and interest rates, it’s wise to examine a lender’s reputation.
Generally, applying is straightforward. Your student will provide financial and loan details, submitting them to the lender. Additionally, they may be able to choose certain loan specifics, like the preferred term length, at this stage.