Refinancing with Earnest
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Roughly seven out of 10 students who graduated from four-year colleges in recent years have student loans. But just because you have them doesn’t mean they have to be expensive.
With the PenFed student loan refinancing program, you might be able to get a lower interest rate or monthly payment. Here’s how refinancing with PenFed Credit Union could help you pay down your student loan debt more quickly and with less interest.
PenFed Credit Union review
PenFed primarily serves government employees and military personnel, but you don’t have to belong to either group to join.
How to join PenFed Credit Union
Like any other credit union, PenFed has certain eligibility requirements to become a member. The good news is you can bypass those requirements if you apply for its student loan refinancing program.
After you’re preapproved, you’ll fill out a membership form as part of the underwriting process.
PenFed student loan refinancing program review
Here’s what you need to know about the student loan refinancing program through PenFed.
Student loan refinancing terms
To be eligible for the program, you must meet some basic requirements:
- Be a U.S. citizen
- Be at least the age of majority in your state
- Be the borrower on at least one outstanding education loan
- Have a bachelor’s degree or higher
- Have a strong credit history
- Have an annual income of at least $42,000 (or $25,000 with a co-signer)
You can refinance private and federal student loans with PenFed. The credit union offers only fixed APRs, and you can refinance $7,500 to $150,000 in student loans. PenFed doesn’t charge any application, origination, or prepayment fees.
Your APR will depend on your creditworthiness (or that of your co-signer) as well as which of the following repayment periods you choose for your PenFed student loans:
If both you and your spouse have student loans, you can combine them in a couple loan. When you apply for a couple loan, PenFed combines your incomes and bases your interest on the higher of your two credit scores.
Adding a co-signer
Adding a co-signer with good or excellent credit can increase your chance of getting a lower interest rate. If your credit score is 670 to 699, a co-signer is required.
If you’re adding a co-signer to your application, he or she must meet the following requirements:
- Be a U.S. citizen
- Be at least the age of majority in your state
- Be employed at least two years
- Meet co-signer credit requirements
After 12 months of consecutive on-time payments, you can apply to have PenFed remove your co-signer from the loan. At that time, PenFed will re-evaluate your financial and credit profile to make sure you qualify for a co-signer release.
Deferment and forbearance
PenFed doesn’t offer a set deferment or forbearance policy. But it does work with borrowers on a case-by-case basis during times of economic hardship. Plus, there’s no maximum forbearance allowance in terms of months. Many other refinancing lenders offer only up to 12 months.
Other extraordinary circumstances might apply (e.g., losing a job, an illness, or a death in the family) if you’re looking for assistance with your PenFed student loan payments
Just remember: If you get approved for forbearance, interest will continue to accrue during the forbearance period.
Pros and cons of PenFed student loan refinancing
If you’re interested in the PenFed student loan refinancing program, there are some key benefits and drawbacks to consider.
Co-signer release policy: Co-signers are jointly responsible for the student loan debt. So, co-signing a student loan can be risky for both the co-signer and the primary borrower. PenFed’s co-signer release policy can help resolve any long-term concerns.
Competitive rates: All PenFed’s rates are fixed and competitive with other fixed rates on the market. What’s more, you won’t have to worry about your interest rate changing over time like variable interest rates do.
More inclusive: Some other student loan refinancing lenders, such as Navy Federal Credit Union, accept only private student loans. With PenFed, you can refinance both private and federal loans.
Couple loans: The credit union’s spouse loan makes it possible for couples to save money on their student loans without having to refinance separately.
High income and credit requirements: PenFed requires an annual income of at least $42,000 and a credit score of at least 700 to apply without a co-signer. Even with a co-signer, you must earn at least $25,000 and have a 670 credit score or higher to qualify.
Some other refinancing programs have no minimum income requirements or require as little as $24,000 annually.
No autopay discount: Some refinancing programs offer a 0.25% rate discount if you sign up for automatic payments. PenFed, however, doesn’t offer this or any other type of rate discount.
No deferment and unclear forbearance options: If you head to graduate school, you won’t get a deferment on your payments during that time. And if you do qualify for forbearance, it might not be favorable.
Applying for PenFed student loan refinancing
To find out what kind of rate you qualify for, you first need share with PenFed your highest degree, your approximate credit score, and your email address.
Next, you can provide more information about your current loans, select a term, and view what APR you might qualify for if you apply solo or with a co-signer.
The good new is inputting this information to figure out your rate does not affect your credit in any way because you don’t give PenFed or PenFed your Social Security number.
After you go through that process (or if you want to skip it altogether), you can apply online. You’ll need to create a student lending profile so you can log in to see your application.
Once you get to the application stage, you’ll provide the following information:
- Name, address, and phone number
- Citizenship status
- Social Security number
- Driver’s license, passport, or state ID information
- PenFed membership status
- Housing status and monthly housing payment
- Information about your college and degree
- Employment and income information
- References (name, address, phone number, and relationship to you)
- Co-signer information
- Details about your loan(s)
You’ll then consent to e-sign certain documents and agree to disclosures and terms and conditions. After that, you can submit your application.
When you apply, PenFed will run a credit check, which will trigger a hard inquiry on your credit report. If you apply with a co-signer, the same will happen with his or her credit report.
After you apply, PenFed will request the following documents to verify your information:
- A copy of your driver’s license, passport, or state ID
- A pay stub or tax return
- A college transcript or copy or photo of your diploma
- A payoff statement from your current student loan servicer
- A PenFed membership application (if you’re not already a member)
Should you apply for the PenFed student loan refinancing program?
If you meet PenFed’s income and credit score requirements, its program is worth considering. Its fixed interest rates, co-signer policy, and options for couples make it a competitive option against the top refinancing banks.
If you plan to go back to school, though, you might want to choose a program that has a deferment policy. Also, if you have federal student loans, keep in mind that you’ll lose access to student loan forgiveness and income-driven repayment plans if you refinance through PenFed.
To make sure PenFed is right for you, shop around and compare rates and other features. With time and research, you’ll find the best student loan refinancing program for you.
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 5.87% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 5.87% 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
Savings example: average savings calculated based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were disclosed. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
Application detail: 5 minutes indicates typical time it takes to complete application with applicant information readily available. It does not include time taken to provide underwriting decision or funding of the loan.
Instant rates mean a delivery of personalized rates for those individuals who provide sufficient information to return a rate. For instant rates a soft credit pull will be conducted, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
Total savings calculated by aggregating individual average savings across total borrower population from 9/2013 to 12/2017. Individual average savings calculation based on single loans refinanced from 9/2013 to 12/2017 where borrowers’ previous rates were provided. Assumes same loan terms for previous and refinanced loans, and payments made to maturity with no prepayments. Actual savings for individual loans vary based on loan balance, interest rates, and other factors.
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.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate||Visit SoFi|
|2.47% – 5.87%1||Undergrad & Graduate||Visit Earnest|
|2.47% – 8.03%4||Undergrad & Graduate||Visit Lendkey|
|2.95% – 6.37%2||Undergrad & Graduate||Visit Laurel Road|
|2.48% – 6.25%5||Undergrad & Graduate||Visit CommonBond|
|2.72% – 8.32%6||Undergrad & Graduate||Visit Citizens|