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Refinancing student loans can help students save money and pay back their loan faster. However, for international students without a credit history in the U.S., refinancing options are limited. If you’re considering refinancing your student loans as an international student, it’s important to know how the process works.

This guide on student loan refinance for international students will walk you through it.

How Refinancing Student Loans Works

Student loan refinancing is the process of replacing your current student loans with a new loan that has one monthly payment. You can refinance both private student loans and federal student loans, potentially saving money and time as you pay off your debt.

Student loan refinancing companies like SoFi offer fixed and variable interest rates that may be lower than what you’re currently paying on your student loans.

With student loan refinancing, you can also choose from various student loan repayment options and terms, allowing you to pay off your loans as quickly as your budget allows. The shorter your repayment period, the more you’re likely to save on interest, while a longer repayment term typically means you pay more interest over the life of the loan.

As you consider your strategy for paying off your student loan debt, refinancing can be a crucial element in helping you achieve your goal.

Another term you may hear as you’re exploring the idea of refinancing is “consolidation.” The terms are sometimes used interchangeably, but they are not the same thing. With student loans, consolidation is generally associated with federal loans through the Federal Direct Loan Consolidation Program, while refinancing is typically done through a private lender.

Recommended: Can International Students Get Student Loans?

Where to Refinance Student Loans for International Students

When you’re an international student, it’s not always easy to know where to go to refinance your student loan. Many lenders require you to be a U.S. citizen or permanent resident to be eligible for international student loan refinance, but fortunately, some companies provide more flexibility and may offer such options as student loans for H-1B visa holders.

For instance, SoFi as well as MPOWER offer student loan refinance for international students. SoFi considers U.S. citizens, permanent residents, and people who hold a J-1, H-1B, E-2, E3, O-1, or l-1 visa (as of the date of this article).

If you’re a permanent resident, you’ll need to either have at least two years left until your status expires to refinance student loans for international students. And if you’re a visa holder, you’ll need to have at least two years left before your status expires, or you’ve applied for permanent residency.

That said, qualifying based on your citizenship, resident, or visa status doesn’t necessarily mean you qualify based on all criteria. Student loan refinancing lenders also typically have credit and income requirements.
This means that if you don’t have an established credit history — which is not always the case for international students — you may have a tough time getting approved on your own.

If this is your situation, it might be worth getting a student loan refinancing cosigner, such as a trusted family member or friend who is a U.S. citizen or permanent resident, to apply with you to help strengthen the creditworthiness of your application. This can be helpful because a cosigner acts as a backup for your application, and they are also legally obligated to repay the loan if you can’t. Even if you do qualify to refinance your student loans on your own, a co-signer could help you get a lower interest rate.

To help improve your chances of getting approved for international student loan refinance with more favorable terms, such as a low rate, it’s a good idea to choose a co-signer who has a stellar credit history and a solid income.

Eligibility Requirements for International Students

Refinancing eligibility requirements for international students can vary by lenders. However, there are some specific criteria most lenders look for.

Credit Score and Financial History

To be eligible for student loan refinance, an international student needs to have a solid credit history. Lenders generally perform a credit check on borrowers before deciding whether to give them a loan. They check the borrower’s credit score and credit report to see if they have made loan and credit card payments, which helps them assess whether the borrower can repay a refinance loan.

Most international students don’t have a credit history in the U.S. Yet most forms of borrowing, including credit cards, typically require individuals to be U.S. citizens or permanent residents. That makes it difficult to get credit. That’s why having a creditworthy cosigner on the loan can be helpful.

Lenders may also consider your income when deciding whether to give you a loan. They want to see that you have a steady income that’s high enough to make loan payments. Again, a creditworthy cosigner with a steady and sufficient income may help bolster your chances of getting a refinance loan.

Consigner Requirements and Options

When choosing a cosigner, keep in mind that they, too, will need to meet certain requirements from the lender. This generally includes:

•   Being a U.S. citizen or a permanent resident

•   A Social Security number

•   Good to excellent credit (a good credit score is considered to be above 670)

•   A stable job and a steady income

It’s important for the cosigner to understand that they are taking equal responsibility along with the primary borrower for repaying the loan. Any late or missed payments could harm their credit. Make sure the person you choose as your cosigner is someone you trust, and that they are willing to take on the responsibilities — and possible risk — involved.

Two Things to Consider Before Refinancing Your Student Loans

Refinancing might not be the right option for everyone. Here are three things to think about before you make your decision:

You May Not Qualify for a Lower Rate

Your eligibility and student loan interest rate are based on several factors, including your credit history and income. As such, there’s no guarantee you’ll get approved for a lower interest rate than what you’re currently paying, even with a co-signer.

Also, if you already have a relatively low interest rate with your current lender, you may have a hard time getting an even lower rate.

Fortunately, some lenders, including SoFi, allow you to check your rate before you officially apply to refinance. This is done with a soft credit check, which doesn’t impact your credit score.

Refinancing Is Just One Piece of the Puzzle

As you think through your student loan repayment strategy, keep in mind that refinancing isn’t the end of the line. Once you complete the process of refinancing your loans, it’s important to make sure you’re paying down your debt.

For example, consider creating a budget and looking for ways to put extra cash toward your student loan payments each month. If you get some extra money — a chunk of cash for your birthday, say — you can put that toward your loan payments as well.

Additionally, you could go with a shorter repayment period to save even more time and money on your debt. Just be aware that a shorter repayment period means your monthly payments will be higher.

Pros and Cons of Refinancing as an International Student

Refinancing your student loans as an international student could be a way to help manage your monthly payments. But there are advantages and disadvantages to carefully consider before moving ahead.

Benefits of Refinancing

The pros of refinancing student loans include:

•   A lower interest rate: If they can qualify, a lower interest rate can save borrowers money on the amount of interest they pay over the life of the loan. They could potentially save thousands of dollars.

•   Lower monthly payments: With more flexible loan terms, a borrower could lower monthly payments by extending the loan term. However, with a longer repayment term, they will pay more in interest over the life of the loan.

•   Repayment is easier to manage: With refinancing, a borrower has just one loan to keep track of and pay each month, rather than multiple loans. This can simplify the repayment process.

Potential Drawbacks to Keep in Mind

There are several disadvantages to refinancing, such as:

•   Refinancing as an international student may be challenging: Many lenders don’t offer student loan refinancing to international students. Those that do typically offer refinancing to international borrowers with certain types of visas or those with permanent residency status.

•   A cosigner may be required: Many international students don’t have a credit history in the U.S, which is something lenders look for. In that case, a creditworthy cosigner may be needed to secure refinancing.

•   Refinancing federal student loans makes them ineligible for federal benefits: While both federal and private student loans can be refinanced, refinancing federal loans means that borrowers no longer have access to federal programs and protections, such as income-driven repayment plans and federal deferment. (Although federal student loans are not typically available to international students, some international students who are permanent residents of the U.S. or have certain types of visas may be eligible for them.)

The Takeaway

If you’re considering refinancing student loans as an international student, be sure to check your eligibility requirements with private lenders. If you don’t have a strong credit history, consider adding a co-signer who is a U.S. citizen or permanent resident to strengthen your refinance loan application.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

What lenders refinance student loans for international students?

Lenders that refinance student loans for international students include SoFi, MPOWER, Earnest, and PNC among others. Generally, you’ll need to have a certain type of visa or be a permanent resident to be eligible. Check the specific eligibility requirements with each lender.

Do I need a U.S.-based cosigner to refinance my student loans?

A U.S.-based cosigner who is a citizen or permanent resident and has strong credit, a steady job, and a good income may strengthen an international student’s application for student loan refinance. That’s because lenders look at a borrower’s credit history and income when deciding whether to issue a loan. A cosigner takes equal responsibility for the loan and repays it in the event the primary borrower can’t.

What are the alternatives if I can’t refinance my student loans?

If you are unable to refinance your student loans, you could create a budget to save money and then put the money you save toward your loan payments to help pay down your debt faster. You can also pay more toward the principal on your loan each month, which may help you pay off your loans faster.

You can look into student loan consolidation if you have federal student loans and want to simplify the payment process, or income-based repayment plans if you’re trying to lower your federal monthly loan payment.

How does refinancing affect my credit score as an international student?

If you are able to refinance your loan as an international student, it could help build your credit over time as long as you consistently make your monthly payments by the due date. When you refinance and make on-time payments, you are helping to build a credit history for yourself, which could make it easier to be approved for loans or credit cards in the future.

Is refinancing worth it if I plan to return to my home country?

You will still be responsible for paying off your student loans if you return to your home country. So if refinancing gets you a lower rate or more favorable loan terms, it may be worth doing.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOSLR-Q225-026

No one intends to waste money, yet it’s all too easy to look back and wonder where your paycheck went — and why it disappeared so fast.

Spending is personal. Whether you treat yourself to nights out or a biweekly fitness class, it’s your money and your choice. As long as these purchases align with your budget and priorities, they’re not inherently “bad.”

Still, you might find yourself wanting to rein in your spending. And that’s often easier said than done. Budgeting doesn’t come naturally to everyone, and many of us could benefit from a little guidance in spotting where our money might be slipping away.

With that in mind, here are some common ways people waste money — often without even realizing it. A few small changes can make a big difference.

Recurring Subscriptions

Set it and forget it is great when it comes to automating your personal finances, but it’s less than ideal when it comes to subscription services. A full 81% of American homes have at least one streaming service subscription, and the average U.S. subscriber has signed up for around four services.

On top of streaming entertainment services, many American consumers subscribe to a regular delivery service, like Dollar Shave Club, Hello Fresh, or FabFitFun. Whether you are ready to ditch some monthly services or not, you can try tracking your monthly recurring spending on a spreadsheet, using your bank’s app, or enrolling in a free service, like Trim by OneMain or Hiatus, to catch those monthly bills.

From there, you can decide what stays and what goes. Consider what might be worth the cost based on frequency, or what is worth canceling because you didn’t even realize you were signed up. For instance, you might decide to save on streaming services and reduce the number of subscriptions you have on that front.

💡 Quick Tip: Typically, checking accounts don’t earn interest. However, some accounts do, and online banks are more likely than brick-and-mortar banks to offer you the best rates.

Food Expenses

Buying groceries is an essential part of your monthly budget, but it’s still one to keep an eye on. Purchasing too many groceries can be a big wasted expense. The average American throws away 325 pounds of food a year, and the average U.S. family of four throws out $1,600 a year just in produce. Meal planning and buying only what’s needed can help you spend less on food and reduce waste, too.

But groceries aren’t the only area where people waste money on food. The average home in America spends nearly $4,000 on food away from home per year, which includes home delivery.

Dining out is great for special occasions and, yes, ordering in makes sense sometimes, too. But eating even a few more meals at home a week can lead to some serious long-term savings.

Recommended: Savings Calculator

Small Impulse Buys

When a purchase is one click or tap away, buying things on impulse — like a new gadget, treat, or toy for the kids — becomes all too easy. Many of us rationalize these purchases because each item is not all that expensive.

But $5 here and $20 there can add up faster than you realize. Recent research suggests that more than one in five Americans (22%) have made impulse purchases that have significantly impacted their finances in the past 12 months.

Impulse spending ranges dramatically from shopper to shopper, but curbing it can look the same across the board. Try waiting at least 24 hours before making a nonessential purchase. This pause helps you to assess whether the purchase is truly a need or just a passing desire.

When shopping for not-so-small items online, consider implementing the “30-day rule” That means letting something sit in a digital shopping cart for 30 days before determining if it’s worth purchasing.

Slowing down the buying cycle can help separate want from need and prevent purchases that are forgotten moments after the transaction.

Unreturned and Unused Items

Some of us leave a lot of cash sitting on the floor of our closets. Ordering clothing and other items online has become fast and seamless, but when something doesn’t meet our expectations, returning it becomes a chore. So we let it sit.

Obviously, summoning your energy to deal with unwanted items and returning them is one solution. But if you missed the return window and/or have a closet full of unworn (or barely worn) clothes, you may be able to recoup some of your costs by finding places to sell used stuff. These can range from local consignment shops to online marketplaces like Poshmark or Depop.

Transportation Costs

Transportation is a major expense for many people, and it’s easy to overspend without realizing it. One common way people waste money in this area is relying heavily on ride-hailing services like Uber or Lyft, even for short or routine trips. Owning a car you don’t truly need — especially a new or luxury model — can also be a financial drain due to monthly payments, insurance, maintenance, and gas.

To cut back on spending, you might evaluate how often you truly need a car. If you live in a city with decent public transit, using buses, trains, or biking can significantly reduce costs. Carpooling or using ride-sharing services for occasional needs may also be more cost-effective. If owning a car is necessary, consider choosing a fuel-efficient used vehicle with lower insurance rates and maintenance costs.

Other ways to save money on transportation include using public transportation, walking or biking whenever possible, planning trips in advance to avoid peak ride-share pricing, and consolidating errands to reduce gas usage. Tracking your monthly transportation spending can help you spot areas to cut back without sacrificing convenience or mobility. Small adjustments can lead to major savings over time.

Bank Fees

Many Americans might not even realize how much they’re being charged simply for accessing their money. The average bank overdraft fee is around $31 per occurrence. If you’re not paying attention, you could overdraw multiple times before realizing what you’ve done and end up with a negative bank balance.

Some banks will even charge customers just for holding an account with them. Costs vary, but the average monthly account maintenance fee is around $14 per month.

ATM fees can also deplete your account over time. If you use an ATM that is not part of your bank’s network, you may pay two fees — one charged by your bank, and one charged by the ATM operator. Combined, these two types of fees add up to an average of $4.55. While that’s not a large sum, it can multiply quickly if you frequently use ATMs.

The Takeaway

Being mindful of how you spend your money is crucial for achieving long-term financial stability and peace of mind. By recognizing common areas of wasteful spending — such as food, unused subscriptions, impulse buys, Uber rides, unreturned items, and unnecessary bank fees — you can make more intentional financial decisions.

Regularly tracking your expenses and reviewing your budget can help eliminate unnecessary costs and ensure you’re using your money in ways that align with your income, needs, values, and goals.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

How do you know if you are wasting money?

You might be wasting money if you frequently make impulse purchases, pay for unused subscriptions, or buy items you don’t need. Track your expenses to identify patterns and unnecessary spending. If you find yourself consistently overspending in nonessential categories or not meeting your financial goals, it’s a sign to reassess your budget and spending habits. Regularly reviewing your finances can help you make more mindful and intentional spending decisions.

What is the 70/20/10 rule money?

The 70/20/10 rule is a budgeting strategy that divides your income into three parts: 70% for living expenses (including necessary and discretionary spending), 20% for savings and investments, and 10% for extra debt payments or charitable donations. This approach helps you manage your finances responsibly, build wealth, and contribute to causes you care about.

What do Americans waste the most money on?

Americans often waste the most money on dining out, unused subscriptions, and impulse purchases. Other common areas include high-interest credit card debt, expensive coffee and snacks, and overpriced phone plans. Regularly reviewing your expenses can help identify wasteful habits and help become more mindful of how you spend your money.

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Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

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Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

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SOBNK-Q225-073

Buying a new home requires managing a lot of moving parts, from mortgage preapproval to closing. Even after an offer is accepted, buyers and sellers are still at the negotiating table. If closing costs or surprise expenses become too much for the buyer, a seller concession could help seal the deal.

Although seller concessions can work to a buyer’s advantage, they are neither a guaranteed outcome nor a one-size-fits-all solution for every real estate transaction.

To determine if seller concessions are the right move from a buyer’s perspective, here are some key things to know, including what costs they can cover and when to consider asking for them.

Note: SoFi does not offer seller concessions at this time.

What Are Seller Concessions?

Seller concessions represent a seller’s contribution toward the buyer’s closing costs, which include certain prepaid expenses and discount points. A seller concession is not the equivalent of a price reduction; nor is it received as cash or a loan discount.

Closing costs usually range from 2% to 5% of the loan principal on your mortgage. When that’s combined with a down payment, the upfront expense of buying a home can be burdensome, especially for first-time homebuyers.

Buyers can ask for concessions on the initial purchase offer or later if the home inspection reveals problems that require repairs.

Although this can be a helpful tool to negotiate a house price, there are rules about eligible costs and limits to how much buyers can ask for.

Recommended: Homebuyer Guide

What Costs Can Seller Concessions Cover?

A buyer’s closing costs can vary case by case. Generally, buyers incur fees related to the mortgage loan and other expenses to complete the real estate transaction.

There are also types of prepaid expenses and home repairs that can be requested as a seller concession.

Some common examples of eligible costs include the following:

•   Property taxes: If the sellers have paid their taxes for the year, the buyer may be required to reimburse the sellers for their prorated share.

•   Appraisal fees: Determining the estimated home value may be required by a lender to obtain a mortgage. Appraisal costs can vary by geography and home size but generally run between $300 and $400 for a single-family home and a conventional loan.

•   Loan origination fees: Money paid to a lender to process a mortgage, origination fees, can be bundled into seller concessions.

•   Homeowners insurance costs: Prepaid components of closing costs like homeowners insurance premiums can be included in seller concessions.

•   Title insurance costs: A title insurance company will search to see if there are any liens or claims against the property. This verification, which varies widely in price, but generally costs between 0.1% to 2% of the loan principal, protects both the homeowner and lender.

•   Funding fees: One-time funding fees for federally guaranteed mortgages, such as FHA and VA loans, can be paid through seller contributions. Rates vary based on down payment and loan type.

•   Attorney fees: Many states require a lawyer to handle real estate closings. Associated fees can run from about $750 to $1,250 or more, based on location.

•   Recording fees: Some local governments may charge a fee to document the purchase of a home.

•   HOA fees: If a home is in a neighborhood with a homeowners association, there will likely be monthly dues to pay for maintenance and services. A portion of these fees may be covered by the seller.

•   Discount points: Buyers may pay an upfront fee, known as a discount point, to lower the interest rate they pay over the life of the mortgage loan. (The cost of one point is typically 1% of the loan amount and may lower your mortgage rate by as much as 0.25%.)

•   Home repairs: If any issues emerge during a home inspection, the repair costs can be requested as a seller concession.

Closing costs can also be influenced by the mortgage lender. When shopping for a mortgage, evaluating expected fees and closing costs is a useful way to compare lenders. Factoring in these costs early on can give buyers a more accurate idea of what they can afford and better inform their negotiations with a seller.

Recommended: How Much Are Closing Costs on a New Home?

Rules and Limits for Seller Concessions

Determining how much to ask for in seller concessions isn’t just about negotiating power. For starters, the seller’s contributions can’t exceed the buyer’s closing costs.

Other factors can affect the allowable amount of seller concessions, including the type of mortgage loan and whether the home will serve as a primary residence, vacation home, or investment property.

Here’s a breakdown of how concessions work for common types of loans.

Conventional Loans

Guidance on seller concessions for conventional loans is set by Fannie Mae and Freddie Mac. These federally sponsored enterprises buy and guarantee mortgages issued through lenders in the secondary mortgage market.

With conventional loans, the limit on seller concessions is calculated as a percentage of the home sale price based on the down payment and occupancy type.

If it’s an investment property, buyers can only request up to 2% of the sale price in seller concessions.

For a primary or secondary residence, seller concessions can add up to the following percentages of the home sale price:

•   Up to 3% when the down payment is less than 10%

•   Up to 6% when the down payment is between 10% and 25%

•   Up to 9% when the down payment is greater than 25%

FHA Loans

FHA loans, which are insured by the Federal Housing Administration, are a popular financing choice because down payments may be as low as 3.5%, depending on a borrower’s credit score.

For this type of mortgage, seller concessions are limited to 6% of the home sale price.

VA Loans

Active service members, veterans, and some surviving spouses may qualify for a mortgage loan guaranteed by the Department of Veterans Affairs. For buyers with this type of mortgage, seller concessions are capped at 4% of the home sale price.

VA loans also dictate what types of costs may qualify as a seller concession. Some eligible examples: paying property taxes and VA loan fees or gifting home furnishings, such as a television.

Recommended: Guide to Buying, Selling, and Updating Your Home

Seller Concession Advantages

There are a few key ways seller concessions can benefit a homebuyer. For starters, they can reduce the amount paid out of pocket for closing costs. This can make the upfront costs of a home purchase more affordable and avoid depleting savings.

Reducing closing costs could help a buyer make a higher offer on a home, too. If it’s a seller’s market, this could be an option to be a more competitive buyer.

Buyers planning significant home remodeling may want to request seller concessions to keep more cash on hand for their projects.

Seller Concession Disadvantages

Seller concessions can also come with some drawbacks. If sellers are looking for a quick deal, they may view concessions as time-consuming and decline an offer.

When sellers agree to contribute to a buyer’s closing costs, the purchase price can go up accordingly. The deal could go awry if the home is appraised at a value less than the agreed-upon sale price. Unless the seller agrees to lower the asking price to align with the appraised value, the buyer may have to increase their down payment to qualify for their original financing.

Another potential downside is that buyers could ultimately pay more over the loan’s term if they receive seller concessions than they would otherwise. If a buyer offers, say, $350,000 and requests $3,000 in concessions, the seller may counteroffer with a purchase price of $353,000, with $3,000 in concessions.

The Takeaway

Seller concessions can make a home purchase more affordable for buyers by reducing closing costs and expenses, but whether it’s a buyer’s or seller’s market will affect a buyer’s potential to negotiate. A real estate agent can offer guidance on asking for seller concessions.

FAQ

How do you explain seller concessions?

Seller concessions are the costs and fees that a seller may agree to pay on behalf of a buyer to sweeten the deal. These could include expenses like property taxes, appraisal fees, loan origination fees, homeowners insurance costs, attorney fees, title insurance fees, recording fees, funding fees, HOA fees, mortgage point costs, and even repair costs.

Can seller concessions exceed closing costs?

Seller concessions cannot be greater than closing costs. The maximum amount of seller concessions you can get with a given mortgage depends on a number of factors, including the type of loan it is, but the amount will never exceed the amount of the closing costs.

What is the most a seller can pay in closing costs?

The maximum a seller can pay in closing costs depends on the type of mortgage that’s involved. For a conventional loan, the maximum for an investment property is 2% of the sale price. For a primary or secondary residence, it depends on the down payment: up to 3% when the down payment is less than 10%; up to 5% when the down payment is between 10% and 25%; and up to 9% when the down payment is more than 25%. The amount sellers can pay in closing costs is capped at 6% for FHA loans and 4% for VA loans.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

SOHL-Q225-172

One of the biggest student loan myths is that borrowers can’t combine federal student loans and private student loans into one refinanced loan.

It’s understandable why people may think that, since this wasn’t always an option. And consolidation through the Department of Education is only available for federal student loans.

But now you can choose to combine federal and private loans. So it’s important to learn whether combining them is right for you, and if it is, how to consolidate private and federal student loans.

Can I Consolidate Federal and Private Student Loans?

If you’ve ever wondered, can I consolidate federal and private student loans?, the answer is yes. You can combine private and federal student loans by refinancing them with a private lender.

Through this process, you apply for a new loan (which is used to pay off your original loans) and obtain one with a new — ideally lower — interest rate.

Although you are combining your loans, refinancing isn’t the same thing as federal student loan consolidation.

Key Differences Between Consolidation and Refinancing

Some people use the words “refinance” and “consolidate” interchangeably, but consolidating student loans is a different process than refinancing student loans.

Federal student loans can be consolidated into one loan by taking out a Direct Consolidation Loan from the government. To be eligible for a Direct Consolidation Loan you must have at least one Direct Loan or one Federal Family Education Loan (FFEL). Federal loan consolidation does not typically lower your interest rate. The new student loan consolidation rate is the weighted average of the interest rates of your prior loans, rounded up to the nearest ⅛ of a percent.

You can only consolidate federal student loans in this way. Private student loans are not eligible for federal loan consolidation.

When you refinance student loans, you exchange your old student loans for a new private loan. You can refinance private student loans, federal student loans, or a combination of both types. When you refinance, you may be able to get a lower interest rate, which could help you save money on interest over the life of the loan, or more favorable loan terms, if you qualify.

However, refinancing federal loans makes them ineligible for federal benefits such as deferment and income-driven-repayment plans.

Pros and Cons of Combining Federal and Private Loans

Before you combine federal and private student loans, there are a number of things to think about. Consider the following advantages and drawbacks.

Pros:

•   Combining federal and private loans may result in a lower interest rate if you qualify, which could help you save on interest over the life of the loan.

•   You may be able to lower your monthly payments through refinancing by extending the term of your loan.

•   Combining your loans can help you manage and streamline your payments since you’ll have just one loan rather than several.

Cons:

•   Combining federal and private loans through refinancing means you’ll lose federal protections like forgiveness and deferment.

•   In order to get lower interest rates, you’ll need a good credit score, a stable job, and a steady income.

•   If you extend the term of the loan to lower your monthly payments, you’ll pay more interest over the life of the loan.

If you’re still debating what to do, here’s an easy decision tree to help you understand whether refinancing federal and private loans is the right option for you:

Steps to Consolidating Private and Federal Loans

If you decide that loan consolidation makes sense, here’s how to consolidate private and federal student loans through refinancing:

1.    Decide which loans you want to consolidate. For instance, maybe you’d like to combine some of your federal loans with your private loans, but not all of them.

2.    Look into lenders. Private lenders that provide refinancing include banks, credit unions, and online lenders. Each one offers different rates and terms. Find out about any fees they might charge, what kind of customer service they have, and what their eligibility requirements are.

3.    Shop around. Each lender uses different criteria to determine if you’re eligible for a loan and the rates and terms you may get. To help find the best deal, you can prequalify with several lenders. Prequalifying involves a soft credit check, not a hard credit inquiry, so your credit score won’t be affected.

4.    Apply for refinancing. Once you’ve selected a lender, you can fill out a loan application. You can typically do this online. You’ll need to provide your personal, employment, and salary information, as well as details about your private and federal student loans. Be sure to have backup like pay stubs and loan paperwork readily available since you may need to provide it. The lender will do a hard credit check, which could temporarily cause your credit score to drop a few points.

5.    Find out if you’re approved. In general, you’ll learn whether you’re approved within several days. Keep an eye out for information from your new lender about the payments and due dates on the new loan.

Federal Student Loan Interest Rates

Depending on loan type and disbursement date, federal student loan interest rates are reassessed annually, every July. For the 2025-2026 school year, interest rates on new federal student loans range from 6.39% to 8.94%. Interest rates on federal student loans are determined by Congress and fixed for the life of the loan.

How Interest Rates Affect Consolidation and Refinancing Decisions

As noted earlier, when you apply to refinance, private lenders evaluate things like your credit history and credit score, as well as other personal financial factors, to determine the interest rate and terms you may qualify for.

If you’ve been able to build credit during your time as a student, or your income has significantly improved, you may be able to qualify for a more competitive interest rate than the rate on your current federal student loans — and perhaps any private student loans you have — when you consolidate your loans by refinancing with a private lender.

To get an idea of how much refinancing could potentially reduce the cost of interest on your loans, crunch the numbers with SoFi’s student loan refinancing calculator.

Federal Student Loan Benefits

Federal student loans come with a number of federal benefits and protections. If you refinance your federal loans — whether you’re consolidating them with private loans or not — the loans will no longer be eligible for federal benefits and protections.

Protections You May Lose When Combining Loans

Before you move ahead with refinancing, take a look at your loans to see if any of the following federal loan benefits and programs apply to you — and whether you might want to take advantage of them in the future. If you think you might need any of these protections, combining loans by refinancing them likely isn’t a good idea for you.

Student Loan Forgiveness

There are a few forgiveness programs available for borrowers with federal student loans. For example, under the Public Service Loan Forgiveness Program (PSLF), your Direct Loan balance may be eligible for forgiveness after 120 qualifying, on-time payments if you’ve worked in public service for an eligible nonprofit or government organization that entire time.

Pursuing PSLF can require close attention to detail to ensure your loan payments and employer qualify for the program. The qualification requirements are clearly stated on the PSLF section of the Federal Student Aid website.

Similarly, the Teacher Loan Forgiveness Program is available for teachers who work in eligible schools that serve low-income families full-time for five consecutive years. The total amount forgiven depends on factors like the eligible borrower’s role and the subject they teach.

Income-Driven Repayment Plans

Income-driven repayment plans can ease the burden for eligible borrowers who feel their loan payments are higher than they can afford. With income-driven repayment, monthly payments are calculated based on borrowers’ discretionary income and family size, which can lower how much you owe each month. That can make your student debt more manageable. The repayment period on these plans is 20 to 25 years.

Just be aware that when you lower your payments or extend your repayment term, you’ll pay more interest over time.

Deferment or Forbearance

Borrowers who are having difficulty making payments on their student loans may qualify for deferment or forbearance, two programs that allow borrowers to temporarily pause payments on their federal student loans.

The biggest difference between them is that with forbearance, the borrower is responsible for paying the interest that accrues on the loan. Forbearance can have a major financial impact on a borrower, as any unpaid interest will be added to the original loan balance. With deferment, the borrower may or may not be responsible for paying the interest that accrues. For instance, those with Direct Subsidized Loans are not responsible for paying the accruing interest.

Refinancing Your Student Loans

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

How does refinancing affect my credit score?

Refinancing affects your credit score because when you submit a formal loan application, the lender will check your credit score and credit history, which is known as a hard credit inquiry. That may cause your credit score to drop a few points temporarily.

Can I keep federal loan protections if I refinance?

No. Refinancing federal student loans with a private lender means that you lose access to federal programs and protections like income-driven repayment and forgiveness.

What are the risks of refinancing student loans?

The risks of refinancing federal student loans is losing access to federal programs and protections. In addition, if you extend the term of the loan through refinancing to lower your monthly payments, you’ll end up paying more interest over the life of the loan.

Is it better to consolidate or refinance student loans?

Whether it’s better to consolidate or refinance your student loans depends on your situation. If you have federal loans and want to combine them all into one loan to streamline your payments and make them more manageable, consolidation may be the right option for you.

On the other hand, if you have private loans and your credit and financial background is strong, refinancing may help you get a lower interest rate, which could help you save money. Refinancing may also be worth considering if you have federal loans and won’t need to use any of the federal benefits they provide, and you can qualify for a lower interest rate.

What should I consider before combining federal and private student loans?

Before combining federal and private student loans through refinancing, make sure you won’t need to use any of the federal benefits that federal student loans provide, such as income-driven repayment and deferment. Remember, refinancing makes federal loans ineligible for these programs.

Also, consider whether your credit and financial history is strong enough to qualify for a lower interest rate than you have on your current loans before refinancing.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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