There's never been a better time to refinance your student loan at a fixed rate for better terms.
Fixed student loan refinance rates set a new record low for the week of Dec. 13, reaching 3.33% for well-qualified borrowers who chose the 10-year term, according to Credible data. This breaks the previous record of 3.35% set during the week of Nov. 22.
Refinancing to a lower student loan rate can help you reduce your monthly payments, pay off your debt faster and save money on interest over the life of the loan.
Keep reading to learn more about the latest student loan refinancing rate trends, as well as how to lock in a record-low interest rate on your college debt. You can browse current rates from real private lenders in the table below, and visit Credible to see your estimated rate for free without impacting your credit score.
Fixed student loan refi rates at record lows as variable rates rise
If you're considering refinancing your student loan debt to a new fixed-rate loan, now is a great time to do so.
Aside from reaching a record low of 3.33%, fixed interest rates on the 10-year student loan refinancing term are also down considerably from the same time last year, when they sat at 3.86%.
However, variable rates on 5-year refinancing loans edged up to 2.82% during the week of Dec. 13, which is up from 2.75% the week prior. Average variable rates are significantly down from the same time last year, though, when they averaged 3.20%.
Keep in mind that refinancing your federal student loans into a private loan will make you ineligible for select government benefits, such as administrative forbearance, income-driven repayment plans and student loan forgiveness programs.
If you decide to refinance your student loan debt into a new loan with better terms, visit Credible to compare refinancing rates across multiple private lenders. Then, use a student loan refinance calculator to determine if this debt repayment option is right for you.
How to lock in a low student loan interest rate
Although private student loan refinance rates are near all-time lows, the rate you ultimately receive is dependent on a number of factors. Lenders determine student loan refinancing rates and eligibility based on the following criteria:
- The borrower's credit history. Borrowers with good credit will qualify for the lowest possible student loan refinance rates. Borrowers with bad credit can consider enlisting the help of a creditworthy cosigner to improve their chances of being approved for a loan with a low rate.
- The loan terms. Large loans with longer repayment plans tend to have higher interest rates, while shorter loans with smaller balances carry lower rates. Longer loans also tend to come with lower monthly payments, while shorter loans can help you pay off your debt faster.
- The rate type (fixed or variable). While fixed rates are locked in for the duration of the loan, variable interest rates can fluctuate over time with the market index.
Because student loan refinance rates and eligibility requirements can vary from one lender to the next, it's important to compare refinancing offers across multiple lenders. Most student loan lenders let you get prequalified to see your estimated rates with a soft credit inquiry, which does not affect your credit score.
You can see your prequalified loan repayment offers from Credible's partner lenders for free by filling out a single form in just minutes. That way, you can find the lowest rates possible for your financial situation risk-free.
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