CommonBond Review: See If Refinancing Student Loans Can Save You Money

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Navigating the world of student loan refinancing and consolidation can be confusing. Decoding repayment terms, fee structures and interest rates aren’t always simple. But, with CommonBond, you can refinance your student loans with clear, straightforward terms.

CommonBond believes that creditworthy borrowers should have access to lower interest rates. If your rates are higher than those offered by CommonBond, refinancing your debt could make sense if you qualify. Here’s a deeper look at what this lender has to offer, including…

CommonBond student loan refinancing review

CommonBond provides refinancing on student loans and parent PLUS loans. It also offers loans to undergraduates and graduates, as well as MBA students.

The lender also offers a unique option to transfer PLUS loans to students after graduation.

For this CommonBond student loan review, we’ll focus on refinancing.

Interest rates and terms

Your credit history, debt-to-income ratio, current market interest rates and other variables determine your interest rates.

CommonBond student loan refinance terms are customizable, with fixed, variable and hybrid rates available.

Fixed-rate loans have a locked interest rate for the entire term. Alternatively, variable-rate loans adjust with market interest rates. They can potentially rise — or fall — over the life of your loan.

CommonBond’s fixed- and variable-rate loans are available with repayment periods of five, seven, 10, 15 and 20 years.

The lender’s hybrid loans, which have a 10-year repayment period, are a combination of fixed and variable rates. CommonBond’s hybrid loans have a fixed interest rate for the first five years and a variable rate for the last five years. This takes away some of the uncertainty that comes with variable-rate loans but could help you get a lower interest rate than a typical fixed-rate loan.

Fixed rates are available at 3.21% – 6.45% APR; variable rates have a 1.81% – 6.09% APR range; and hybrid loans are available at 4.35% – 6.30% (as of September 12, 2019). These rates all include the autopay discount.

With autopay, your student loan payment is automatically deducted from your checking account each month. Autopay is not required, but your rate will be 0.25% higher if you don’t use automatic payments.

CommonBond doesn’t charge origination fees or prepayment penalties, but it does charge a 5% late payment fee or $10, whichever is less. There is also a return check fee of $5, though it depends on the limits in your state.

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Eligibility requirements

To be eligible to refinance your student loans through CommonBond, you must be a U.S. citizen, a permanent resident or hold a visa. You must also have graduated from an accredited Title IV school. If your school is not on the list, contact CommonBond to review your options.

If you live in Mississippi or Nevada, you aren’t eligible to refinance.

If you have federal student loans, you will lose some perks if you refinance with a private lender such as CommonBond, like having access to forgiveness options or income-driven repayment plans. CommonBond does offer temporary loan forbearance up to 24 months if you are experiencing financial hardship and can’t make your payments on time. The lender also allows for academic deferment if you decide to return to school for an advanced degree.

How to apply for CommonBond refinancing

A CommonBond review would not be complete without a look at how to apply for refinancing. Overall, the platform is user-friendly and straightforward. It offers easy opportunities to get help via live chat, phone or email.

If you have all your information handy, the process only takes a few minutes. CommonBond will conduct a soft credit check to provide you a rate estimate, but it won’t affect your credit score.

To get started with the CommonBond student loan refinance form, you will fill in basic information about yourself, including your name and address, as well as your student loan balance and estimated pretax annual income.

Next, you’ll get estimated APRs and monthly payments based on possible terms. The information will be broken down by fixed, variable and hybrid rates. Once you choose a term, you’ll need to provide more information, including specifics about your residence, degree and career.

You’ll then be asked to verify information. Once that’s complete, CommonBond will perform a hard credit check to determine your final rate.

Once you’ve signed on the dotted line, CommonBond will coordinate with your original lender to pay off your loans.

If you’re unsure about whether you want to go through the process, CommonBond offers a quiz that estimates how much you can save by refinancing your student loans through them. It asks about your financial goals and your current loans, among other things. The savings you are provided will be based on CommonBond’s lowest available fixed rate, so consider that as you compare your options.

Pros and cons of CommonBond refinancing

As with any financial product, there are benefits and drawbacks. Here’s a look at some pros and cons specific to CommonBond.

Pros

  • Low rates: 1.85% – 6.45% APR
  • Refinance up to $500,000
  • No origination fees or prepayment penalties
  • Multiple loan terms, from 5 years to 20 years
  • Social impact
  • Can have cosigner (and eventually a cosigner release)

Cons

  • Must enroll in autopay to get best interest rates
  • Lose access to protections when you refinance federal student loans
  • Mississippi and Nevada residents not eligible to refinance
  • Minimum credit score around 660

CommonBond’s story

CommonBond was founded by three students who met in 2011 while enrolled in the MBA program at The Wharton School of the University of Pennsylvania. David Klein, Mike Taormina and Jessup Shean leveraged their top-tier business education to try to solve the frustrations of student lending. Klein leads the executive team.

One of the most impressive parts of CommonBond is its social activism. Through a partnership with the nonprofit Pencils of Promise, CommonBond covers the cost of a child’s education in a developing country each time a new loan is taken out or refinanced.

This one-to-one giving was popularized by companies such as Toms and Warby Parker.

How to contact CommonBond

CommonBond’s customer service is accessible via phone, live chat or email. The lender makes customer service a top priority.

As you browse CommonBond’s website, on desktop and mobile, you can click the round chat icon to reach a live person.

Here are the ways you can reach CommonBond through social media:

Customer care is available by phone at 800-975-7812 or email at care@commonbond.co. CommonBond’s headquarters is at 524 Broadway, 6th Floor, New York, NY 10012.

Sarah Sharkey contributed to this report.

Published in Parent Loans, Refinancing & Consolidation, Review