Refinance rates with Laurel Road start at 1.89%.
Checking your rates won’t affect your score.
Note that the situation for student loans has changed due to the impact of the coronavirus outbreak and relief efforts from the government, student loan lenders and others. Check out our Student Loan Hero Coronavirus Information Center for additional news and details.
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Consolidating student loans is an option for borrowers who want to manage their debt more effectively or get better terms. Some might even wonder if it’s possible to consolidate student loans and credit card debt in one fell swoop.
Credit card and student loan consolidation is unlikely to be the right move, however, as it could be your least cost-efficient option. Here are some facts you need to know about why looking to consolidate student loans with other debts is probably a mistake:
- Rules on consolidating student loans and credit card debt
- Using personal loans to consolidate student loans and credit card debt
- The wisdom of consolidating your debt separately
- Tips for refinancing student loans and other debts
- Prioritizing debt if you don’t consolidate
If you’re hoping to meld your student loans and credit cards into a single loan, don’t expect to pay a lower interest rate on the new debt.
Federal student loans have interest rates that usually beat out those of personal loan rates. And although some private lenders do refinance student loans to better rates, this is usually because the new loan is still classified as a student loan.
“You can refinance student loans to a lower interest rate, and that loan will still be limited to qualified education expenses,” Phil DeGisi, a former marketing executive with refinancing company CommonBond, told Student Loan Hero.
Because the new loan is still a student loan, the borrower can’t use it to pay off anything other than existing college debt. This means your student loans cannot be combined with credit cards or other debt under this type of loan.
There are also some other limits in place. Borrowers can usually only qualify for loans equal to their current student loan payoff amounts. Your new loan will also have other qualities of student debt, including being harder to discharge in bankruptcy.
If you’re really set on making student loan and credit card debt consolidation happen, it can be done.
DeGisi noted that you can take out a personal loan and use the money to repay your existing debt, replacing your current loans with a single, new one. However, this usually isn’t a cost-efficient way to manage debt.
“That would be unlikely to be a great path because student debt with high interest will still beat most personal loan interest rates,” DeGisi said.
So while the new loan could provide a lower interest rate than what you’re paying on a credit card, you’ll probably pay more on your student debts with this method.
“Generally speaking, it isn’t going to be a great strategy for someone,” DeGisi said.
The bottom line is that consolidating student loans and credit card debt together won’t likely be the most cost-effective way to restructure debt. Instead, look at each type of debt separately.
|Debt type||Consolidation options|
|Student loans||● Refinancing with a private lender
● Federal direct consolidation loan
|Credit cards||● Balance transfer credit card with a 0% introductory rate
● Personal loan
● Debt management plan
Student loan debt
Refinancing student loans could potentially get you a lower interest rate. This could help you pay off debt faster and potentially lower your monthly payment.
“When refinancing student loans, you can choose which loans to refinance,” DeGisi said. “If you have one loan at a great interest rate, it might not make sense to refinance it.”
|Refinancing Student Loans? Here’s How to Cherry-Pick the Right Ones|
You might be hesitant to refinance federal student loans so that you can maintain access to government-exclusive protections, for example. You could leave them off your private refinancing application and instead take on a direct consolidation loan from the Department of Education. This way, you could consolidate without losing programs like income-driven repayment and loan forgiveness.
With that said, a direct consolidation loan won’t save you any money directly. Only refinancing allows you to lower your interest rate. You can check how much you might save under different scenarios by using our student loan refinancing calculator.
Student Loan Refinancing Calculator
If you’re interested in credit card debt consolidation, there are two common options.
- Transfer the balances to a new credit card with a 0% introductory rate. To optimize savings, look for one without an annual fee, and pay off the balance before the 0% introductory rate ends.
- Get a personal loan (or credit card consolidation loan) and use the funds from that to pay off and consolidate credit card balances. This works because personal loan rates tend to be lower than credit card rates. You could potentially save a nice sum of money, and the installment payments would give you a defined repayment schedule.
If your credit history is spotty and you can’t qualify for the options listed above, you might consider enrolling in a debt management plan.
If you want to refinance student loans and consolidate credit card debt at the same time, there are some things to watch out for — specifically, note that applying for multiple loans or credit cards at the same time can hurt your credit.
“When you apply for the student loan refinance and apply for the personal loan — those are two separate functions, and you’ll get two hard credit pulls that will go on your credit,” DeGisi said. “The first inquiry could lower your credit score, and impact your ability to get approved for the second application.”
On the other hand, consolidating credit card debt could help other factors that lenders consider when approving a student loan refinance, DeGisi said.
When CommonBond evaluates an application, for example, they look at your monthly cash flow. If consolidating credit cards or other debts results in a lower payment, this also gives you more cash flow each month.
If you decide not to consolidate student loans and credit cards, you’ll need to decide which one to pay off first.
Generally speaking, it’s wise to pay off your credit card debt first, as it likely has a higher interest rate. In addition, lowering your credit utilization ratio can boost your credit score.
|Debt Snowball vs. Debt Avalanche: What’s the Best Way to Strategy?|
If you choose to pay off the debt with the highest interest rate first, simply put any extra money you have toward that balance. Of course, you should also continue paying the minimum balance on your other obligations, so they don’t go into default. When your balance on the highest-interest loan falls to zero, shift your focus to the debt with the next-highest interest rate and continue on until you’re out of debt.
Whatever your debt management goals, look at how different refinancing options can help you achieve them. You’ll probably find that student loan and credit card debt consolidation isn’t cost-effective, but there could be another debt solution that’s perfect for what you’re trying to accomplish.
Andrew Pentis and Laura Woods contributed to this report.
Interested in refinancing student loans?Here are the top 9 lenders of 2021!
|Lender||Variable APR||Eligible Degrees|
|1.88% – 6.15%1||Undergrad & Graduate|
|1.88% – 5.64%2||Undergrad & Graduate|
|1.88% – 5.64%3||Undergrad & Graduate|
|2.50% – 6.85%4||Undergrad & Graduate|
|2.25% – 6.39%5||Undergrad & Graduate|
|1.90% – 5.25%6||Undergrad & Graduate|
|1.89% – 5.90%7||Undergrad & Graduate|
|2.39% – 6.01%||Undergrad |
|2.13% – 5.25%8||Undergrad & Graduate|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount
The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.
To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of June 1, 2021.
2 Rate range above includes optional 0.25% Auto Pay discount. Important Disclosures for Earnest.
Interest Rate Disclosure
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 2.59% APR to 5.79% APR (excludes 0.25% Auto Pay discount). Variable rates range from 1.88% APR to 5.64% APR (excludes 0.25% Auto Pay discount). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 36% (the maximum allowable for these loans). Earnest variable interest rate student loan refinance 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 2.04% and 5.8% to the one month LIBOR. Earnest rate ranges are current as of 6/8/2021, and are subject to change based on market conditions.
Auto Pay Discount Disclosure
You can take advantage of the Auto Pay interest rate reduction by setting up and maintaining active and automatic ACH withdrawal of your loan payment. The interest rate reduction for Auto Pay will be available only while your loan is enrolled in Auto Pay. Interest rate incentives for utilizing Auto Pay may not be combined with certain private student loan repayment programs that also offer an interest rate reduction. For multi-party loans, only one party may enroll in Auto Pay.
Student Loan Refinancing Loan Cost Examples
These examples provide estimates based on payments beginning immediately upon loan disbursement. Variable APR: A $10,000 loan with a 20-year term (240 monthly payments of $72) and a 5.89% APR would result in a total estimated payment amount of $17,042.39. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 20-year term (240 monthly payments of $72) and a 6.04% APR would result in a total estimated payment amount of $17,249.77. Your actual repayment terms may vary.Terms and Conditions apply. Visit https://www.earnest. com/terms-of-service, e-mail us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.
Earnest Loans are made by Earnest Operations LLC or One American Bank, Member FDIC. Earnest Operations LLC, NMLS #1204917. 535 Mission St., Suite 1663, San Francisco, CA 94105. California Financing Law License 6054788. Visit earnest.com/licenses for a full list of licensed states. For California residents (Student Loan Refinance Only): Loans will be arranged or made pursuant to a California Financing Law License.
One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Earnest loans are serviced by Earnest Operations LLC with support from Navient Solutions LLC (NMLS #212430). One American Bank and Earnest LLC and its subsidiaries are not sponsored by or agencies of the United States of America.
© 2021 Earnest LLC. All rights reserved.
3 Important Disclosures for Navient.
4 Important Disclosures for CommonBond.
Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. 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 0.15% effective Jan 1, 2021 and may increase after consummation.
5 Important Disclosures for SoFi.
Fixed rates from 2.74% APR to 6.74% APR (with autopay). Variable rates from 2.25% APR to 6.39% APR (with autopay). All variable rates are based on the 1-month LIBOR and may increase after consummation if LIBOR increases; see more at SoFi.com/legal/#1. If approved for a loan your rate will depend on a variety of factors such as your credit profile, your application and your selected loan terms. Your rate will be within the ranges of rates listed above. Lowest rates reserved for the most creditworthy borrowers. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi loans are originated by SoFi Lending Corp. or an affiliate (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license #6054612; NMLS #1121636 (www.nmlsconsumeraccess.org). Additional terms and conditions apply; see SoFi.com/eligibility for details. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
6 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.
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of 5 years and is reserved for applicants with FICO scores of at least 810.
As of 04/07/2021 student loan refinancing rates range from 1.90% APR – 5.25% Variable APR with AutoPay and 2.95% APR – 7.63% Fixed APR with AutoPay.
7 Important Disclosures for Laurel Road.
Laurel Road Disclosures
All credit products are subject to credit approval.
Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.
As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.
Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.
Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.
Interest Rate: A simple annual rate that is applied to an unpaid balance.
Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of April 29, 2021. Information and rates are subject to change without notice.
8 Important Disclosures for PenFed.
Annual Percentage Rate (APR) is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed Rates range from 2.89%-4.78% APR and Variable Rates range from 2.13%-5.25% APR. Both Fixed and Variable Rates will vary based on application terms, level of degree and presence of a co-signer. These rates are subject to additional terms and conditions and rates are subject to change at any time without notice. For Variable Rate student loans, the rate will never exceed 9.00% for 5 year and 8 year loans and 10.00% for 12 and 15 years loans (the maximum allowable for this loan). Minimum variable rate will be 2.00%. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.