10 Questions to Ask When Choosing a Student Loan Refinance Lender

October 01, 2018 · 3 minute read

We’re here to help! First and foremost, SoFi Learn strives to be a beneficial resource to you as you navigate your financial journey. Read more We develop content that covers a variety of financial topics. Sometimes, that content may include information about products, features, or services that SoFi does not provide. We aim to break down complicated concepts, loop you in on the latest trends, and keep you up-to-date on the stuff you can use to help get your money right. Read less

10 Questions to Ask When Choosing a Student Loan Refinance Lender

Got student loans? We’ve got you covered with our Student Loan Smarts blog series. Our expert tips and hacks will help you save money, pay off loans sooner and stress less about student loan debt. Read the other posts in the series here, and get all the info you need to make intelligent decisions about your student loans.

Just a few years ago, not many people knew hat they could refinance student loans. Fast-forward to today and there are daily news headlines on the subject. Almost overnight, refinancing has become the “it” strategy for people looking to save money on student loans.

Not surprisingly, the demand for student loan refinancing has prompted a bevy of online lenders to start offering the service. That’s great news for you—after all, competition breeds innovation, and the smart lenders will continue to improve in order to win your business.

But choosing a lender can be overwhelming. Which student loan refinance company is the best? How do the services of lenders differ? Which one should you trust with your money? If you do your homework and take a little time up front to shop around, you can potentially save money and maybe even land a few unexpected perks.

Related: How To Choose Between Variable and Fixed Rate Student Loans

To help you evaluate student loan refinance companies, we’ve created the handy cheat sheet below. Asking just 10 questions will help you zero in on your best fit.

Student Loan Refinance Lender Questions Cheat Sheet

1. How Great is the Rate?

Ask the lender to provide your interest rate before doing a hard credit pull. If that’s not possible, you should be able to “rate-shop” without affecting your credit, as long as the credit checks are submitted within 30 days of each other. Once you know your rate, use a student loan calculator to estimate your total savings.

2. Can You Refi Federal Loans?

Not many lenders will refinance federal student loans (SoFi is one of the few). Before you refi, learn the pros and cons of refinancing federal student loans.

3. Can you Pick Between Fixed and Variable Rate Loans?

If you’re planning to aggressively pay off your loan, you could save money with a variable rate loan. You can use SoFi’s student loan calculator to estimate your student loan payments. Tools like this can help give you an idea of how much more you may need to be paying each month to pay your loan off faster.

4. Can You Choose Your Loan Term?

In general, a longer term—say, 10 years—means lower monthly payments and higher total interest. A shorter term—5 years, for example—means higher monthly payments and lower total interest. Ideally, your lender will let you choose between the two.

5. What Happens if You Lose Your Job?

Some lenders provide forbearance options for financial hardship situations. For example, SoFi’s unemployment protection allows eligible members to temporarily put loans on hold if they lose their job through no fault of their own. Our Career Coaching team then helps those members find new jobs.

6. Will the Lender Help With Your Career?

One of the best ways to decimate student debt is to increase your earning and student loan repayment power. A lender who helps you get ahead in your career understands this principal.

Recommended: Put a Dent in your Student Debt — 9 Summer Saving Ideas

7. What Other Perks Come With Your New Loan?

If you ask a traditional bank what benefits they offer in exchange for your loan business, they’d laugh you out of their brick-and-mortar buildings. Not so with some of today’s online lenders, including SoFi. From networking events to career support, find out what we can do for you.

8. Is the Application Online?

The last thing you want is to be buried in a mountain of actual paperwork. Look for lenders that offer a short, simple, online form.

9. What’s the Lender’s Rep?

A quick Google search should provide some online reviews and media coverage of the lender, which can help you understand how legit the company is.

Then check out their Facebook and Twitter pages. Overall engagement levels and conversations within a lender’s social communities provide additional, valuable insights into the lender’s credibility.

10. Will the Lender Grow With You?

Sure, lenders can refi your student loans, but what about helping you with other financial milestones, such as buying a home and saving for retirement? Look for a lender that sees the big picture—and wants to invest in your long-term success.

Check out SoFi to see how refinancing your student loans may help you save money.

SoFi can’t guarantee future financial performance.
This information isn’t financial advice. Investment decisions should be based on specific financial needs, goals and risk appetite.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Advisory services offered through SoFi Wealth, LLC, a registered investment advisor.


TLS 1.2 Encrypted
Equal Housing Lender