Refinancing with Earnest
Refinancing rates from 2.47% APR. Checking your rates won’t affect your credit score.
If you have over $100,000 in student loan debt, there are several strategies you can implement to pay it off quickly and without giving up decades of your life to debt.
I know the feeling of this level of debt all too well. Together, my husband and I have nearly $400,000 in student loan debt from graduate school and medical school. And my husband’s not even done with medical school yet (or adding student loans to that total)!
Because he’ll be a physician in a few months, he will be well on his way to earning a high income. However, that doesn’t diminish the student loan burden we both feel. So we’ll be trying a combination of things to eliminate this debt entirely.
If you also have $100k+ of student loan debt, here are some of the best strategies to pay it off as quickly as possible:
1. Minimize Lifestyle Inflation
If you have $100k or more in student loan debt because you attended professional school, chances are you now also have a high income because of your education. Whether you’re a doctor, lawyer, or went to business school, you likely had to put in a lot of time over several years to learn your craft.
Because you’ve spent so long at school, it’s easy to inflate your lifestyle once you get that first paycheck. However, I want to encourage you to keep living like a student for as long as possible.
For example, if you lived off of $30,000 per year while you were in graduate school, try to live off of the same amount during your first few years in the professional world. Hold off on making a new car purchase or buying a new home.
If your take-home pay is $150,000 per year and you live on only $30,000, you now have $120,000 to put towards your debt and the interest your debt has accrued. Do this for 1–3 years in a row, and you could easily pay off your debt and have the rest of your career to enjoy the high income you worked so hard to achieve.
It’s important to note that avoiding lifestyle inflation can help anyone pay off their debt regardless of their income level. It just comes down to spending much less than you earn so that you can aggressively pay off debt quickly and enjoy a life without it.
2. Research Loan Forgiveness
Six figures of debt can be daunting for anyone, regardless of how high your income is. However, there are many different type of loan forgiveness that can help you pay off large portions of your debt.
The best-known loan forgiveness program is the Public Service Loan Forgiveness program. With this program, you have to work in a public service organization like emergency management, the military, or another approved entity.
After making 120 on-time payments while working at an approved organization, your loans are forgiven. And it doesn’t matter whether you have $2,000 or $200,000 left on your balance.
There are also loan forgiveness programs, such as like student loan forgiveness for teachers and Income-Driven Repayment options that offer loan forgiveness after a certain number of years.
3. Look into Refinancing
Although federal loans have the most flexible repayment plans, sometimes refinancing is the best option if you’re looking to save money.
For example, if your student loan interest rate is 6.8%, you can refinance to a private lender like SoFi. As of this writing, SoFi offers fixed rates for student loan refinancing that currently start at 3.90%. You might have shorter repayment terms and larger monthly payments, but you will also save money on interest in the process.
If you started out with private student loans, you likely have interest rates that are even higher, which can bring greater savings if you refinance. Want to get a sense of whether you might qualify to refinance? Take our refinancing eligibility quiz!
4. Focus on Increasing Your Income
If you’re serious about paying off your six figures worth of debt quickly, finding ways to increase your income is likely the most effective strategy.
When it comes to making extra income, you can do a number of different side hustle jobs that can bring in significant cash.
Some side hustle jobs include things like:
- teaching yoga
- pet sitting
- freelance writing and editing
- having a newspaper route
- tutoring high school students
- being a coach
- working as a part-time consultant
If you have an MBA, you can work on the side and help businesses learn how to budget and turn a profit.
If you have a knack for marketing, you can help local businesses improve their social media presence, and if you love working outside, you can cut the grass for family and friends or help people with their gardening.
If you’re a nutritionist by trade, you can work with companies during your off hours to help create company wellness programs.
Essentially, you can do these kinds of work outside of your regular office hours and apply any extra money you make from this type of job towards your student loans. This will help you to pay them down much faster.
Ultimately, having over $100k of student loan debt is overwhelming. I know because my family lives with it every day. However, the good news is that in acquiring that amount of debt, you’ve likely also increased your earning potential.
By working hard, increasing your income, and utilizing refinancing and other repayment options in addition to keeping your living expenses low, you can be well on your way to paying off your debt quickly and enjoying your income going forward without the burden of debt.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
|Lender||Variable APR||Eligible Degrees|
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 6.97% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.30% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.47% – 6.30%1||Undergrad & Graduate|
|2.51% – 8.09%4||Undergrad & Graduate|
|3.02% – 6.44%2||Undergrad & Graduate|
|2.69% – 7.21%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|