Refinancing with Earnest
Refinancing rates from 2.57% APR. Checking your rates won’t affect your credit score.
When people think about high-earning careers, “doctor” and “lawyer” often come to mind. And although these careers can undoubtedly lead to a substantial payday for some, they don’t come without their fair share of student loan debt and hard work.
And anyone studying to be a doctor knows that the lucrative part of this career doesn’t come until after a few grueling and lower-paying years as a medical resident. (All the while student loan debt taken on for medical school is waiting to be repaid.)
Job search site Glassdoor reports an average salary of $56,246 for medical residents in the U.S. And how much student loan debt is being taken on at the same time? According to the Association of American Medical Colleges, a median of $190,000.
So how can medical residents catch a break as they finish out their training and try not to worry about the six figures of debt they have? Finance company SoFi is hoping to provide that break with their new product: medical resident student loan refinancing.
SoFi launches medical resident student loan refinancing
SoFi is already a major player in student loan refinancing — so what’s so different with its new medical resident student loan refinancing compared to its other offerings?
With typical student loan refinancing, your approval depends on factors that often require a solid credit score and income. If approved, you’re locked into the rate and repayment period you chose.
But with medical student loan refinancing, you don’t have to wait until you’re at maximum earning potential to refinance. And if you’re approved, you only have to pay $100 per month during your residency or fellowship.
This low payment can make a big difference for those earning relatively little compared to their student debt load. Many choose to defer their loans during this time frame, but that doesn’t always stop the interest on their debt from compounding. SoFi says their product offers an affordable way to stay on top of that interest.
Here are some details on SoFi’s medical resident refinancing:
- You can include federal and private student loans.
- You’ll pay $100 per month for up to 54 months during your residency or fellowship.
- Interest on your refinanced loans won’t compound during this time frame.
- You can choose from a fixed or variable interest rates.
- In addition to the number of years you have left in your residency, you can choose a repayment period of 5, 7, 10, 15, or 20 years.
- Once you either leave or complete your residency, your amortized payment amount and loan schedule will kick in, and your monthly payment will increase.
- You must have up to four years left as a medical resident or fellow and owe more than $10,000 to qualify.
- You can’t apply until you’ve been matched with a medical residency or fellowship.
The pros and cons of refinancing as a medical resident
SoFi’s medical resident student loan refinancing enables you to lock in a lower rate for your student loans, while also giving you an affordable way to start paying them down now.
But is this product a good idea for you? Here are some things to consider.
Pros of refinancing your student loans as a medical resident:
- You can try to lock in a lower interest rate now without waiting until you earn more.
- You have an alternative to deferring your student loans to save money, one that enables you to stay on top of the interest payments.
- You can use this program to switch to a new student loan servicer if you’re not happy with the one (or several) that you currently have (SoFi works with MOHELA on this product).
- Although the program offers the $100 minimum payment for four years, you can get a six-month extension for a total of 54 months if your residency or fellowship is extended.
- After you have an offer letter in hand for full-time employment, you can try to refinance your student loans again for an even lower rate.
Cons of refinancing your student loans as a medical resident:
- If you refinance federal student loans, you’ll forever forfeit access to income-driven repayment plans and federal student loan forbearance and deferment.
- Similarly, refinancing your federal loans will make you unable to apply for student loan forgiveness.
- There is no grace period for the medical resident student loan refinancing product.
- If the $100 minimum payment doesn’t cover the interest on your refinanced loan, you might end up with a larger balance than you borrowed, unless you pay enough extra to cover the interest for the entire time you’re in a residency or fellowship.
- If you want to switch to a fellowship at the end of your residency, you might not be able to extend the $100 minimum payment.
How to find out more about medical resident student loan refinancing
Financial decisions like this are never easy to make. Don’t be shy about posing as many questions about this as you would in class.
Once you have all the answers, you can know you’re choosing the best way for you to build a strong student loan repayment plan. And you can use that extra mental bandwidth to focus on what you really want — succeeding at this next phase of your career.
Interested in refinancing student loans?Here are the top 6 lenders of 2019!
|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 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.97% 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 email@example.com, 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
|2.57% – 6.97%1||Undergrad & Graduate|
|2.47% – 6.99%3||Undergrad & Graduate|
|2.68% – 8.77%4||Undergrad & Graduate|
|3.24% – 6.66%2||Undergrad & Graduate|
|2.61% – 7.35%5||Undergrad & Graduate|
|3.01% – 9.75%6||Undergrad & Graduate|