Refinancing with Earnest
Refinancing rates from 2.47% APR. Checking your rates won’t affect your credit score.
Refinancing student loans can seem onerous at times. It might seem like a heavy lift to really trim down your interest rate and pay off your student debt faster.
However, there are companies that specialize in helping you tackle your student loan debt in a way that’s more affordable.
Earnest student loans aim to streamline the refinancing process so borrowers have access to “merit-based underwriting” that takes into account many factors more traditional lenders don’t consider. Under this system, more borrowers could find themselves eligible to save money by refinancing their student loans.
This Earnest student loan refinance review will cover how the application and approval processes work, along with some of the pros and cons of the loan, to help you decide if Earnest refinancing is right for you.
Earnest student loan refinance review: the basics
Earnest (which also does personal loans) offers student loan refinancing to college graduates who have their own college debt, as well as to parents who borrowed loans to pay for their child’s education.
Here are some features you can expect with Earnest student loan refinance:
- Variable interest rates starting at 2.47% and fixed interest rates starting at 3.89%
- Autopay discount of 0.25%
- The option to choose your minimum payment
- Repayment terms of between five and 20 years
- Deferment and forbearance options for borrowers who return to school or run into financial hardship
- No set income requirements
- No origination fees or prepayment penalties
- Minimum loan amount of $5,000 and maximum of $500,000
- Minimum credit score of 650
To refinance student loans with Earnest, you must be at least 18 years old and a U.S. citizen or permanent resident. Your debt must also be from a Title IV accredited college or university, and you must have completed your degree or be set to do so in the current semester.
What we like about Earnest student loan refinancing
There’s plenty to love about Earnest if you plan to refinance student loans. Here are some of our favorite features:
Flexible approval process
One of the biggest advantages of Earnest refinancing loans is the fact that approval is possible even with a short or nonexistent credit history.
If you don’t have a strong credit history, Earnest could approve you for student loan refinancing based on several other factors (a particularly negative financial history, however, could prevent you from approval).
When you apply for Earnest student loans, you link your bank accounts to your Earnest profile. The process is similar to the way budgeting tools like Mint and Personal Capital work. It requires your username and password to access your account information.
While the lender does look at your credit report, it doesn’t rely entirely on this traditional method of assessing your reliability. Other aspects of your personal finances — including your checking, savings and investments accounts — are considered during the process.
Earnest’s approval process is unique because it looks not just at your income and current debt, but also other aspects, like your job history. Because of this, Earnest loans might offer an alternative for borrowers who can’t get a competitive rate with a more traditional lender.
Flexible repayment options
Earnest also offers flexible repayment terms which you can customize before locking in your loan. Instead of picking a repayment term and automatically receiving an interest rate and monthly payment, you’re in control. For example, you can choose your monthly payment from a broad range of options that Earnest provides.
You also can choose to skip one payment a year and make it up later. Additionally, Earnest offers forbearance if you unexpectedly lose your job, as well as deferment if you’re serving active duty in the military or as a Peace Corps volunteer. These options allow you to temporarily pause your payments, making it a little easier to manage your student loan debt.
What to keep in mind with Earnest loans
While Earnest offers certain advantages, there are some things to consider before you move forward with your application:
Minimum credit score
Even though Earnest uses factors beyond your credit history to determine your eligibility, you must still meet the minimum credit score requirement of 650.
As a result, Earnest loans might not be an option you’ve had financial problems in the past. However, most lenders also have minimum credit score requirements, so if you do have poor credit, you’ll likely need to improve your financial situation anyway before applying elsewhere.
Additionally, note that you might not qualify to refinance your student loans through Earnest if those loans aren’t in good standing or if you have accounts recently in collection.
No cosigner option
With some lenders, such as SoFi and Citizens Bank, it’s possible to get a cosigner to help you qualify for student loan refinancing. Earnest student loans, however, don’t have a cosigner option for refinancing. So, if you don’t qualify on your own, you won’t be able to improve your chances by getting a cosigner to help you.
Refinancing federal student loans turns them private
Besides issues to consider that are specific to Earnest student loan refinancing, there are some general caveats to refinancing when it comes to federal loans.
Even though refinancing can help you reduce your interest rate in some cases, it’s important to understand that you will lose certain borrower protections if you refinance federal student loans.
Once you refinance with Earnest, for example, you’ll be ineligible for federal income-driven repayment plans and student loan forgiveness programs. Given this, you want to make sure you don’t need any federal programs before you turn your debt private through refinancing.
Is Earnest refinancing right for you?
Before you decide, compare lenders who refinance student loans. Generally speaking, Earnest might be a good choice if you:
- Have good financial habits, like saving money regularly
- Can show regular income and can comfortably afford the monthly payments
- Don’t plan to take advantage of income-driven repayment or student loan forgiveness for your federal student loans
- Have higher interest rates on your current student loans than what’s offered for your refinancing loan
In the end, Earnest student loan refinancing offers flexibility and options that can work well for some borrowers. Carefully consider your situation and your financial needs as you make a decision about your student loans.
Student Loan Hero has independently collected the above information related to Earnest refinancing loans, which is current as of Jan. 29, 2019, unless otherwise noted. Earnest has neither provided nor reviewed the information shared in this article.
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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 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
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the fixed rate will decrease by 0.25%, and will increase back up to the regular fixed 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.
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% – 6.97%1||Undergrad & Graduate|
|2.47% – 6.99%3||Undergrad & Graduate|
|2.68% – 8.96%4||Undergrad & Graduate|
|3.23% – 6.65%2||Undergrad & Graduate|
|2.61% – 7.35%5||Undergrad & Graduate|
|3.00% – 9.74%6||Undergrad & Graduate|