This week’s student loan refinance rate: May 24, 2022

PFI student loan weekly rates on green background

Refinancing your student loan allows you to change your term length.


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Average interest rates on refinanced student loans have fluctuated for the past two weeks, according to Credible. Five-year undergraduate loan rates rose, while graduate rates fell. Ten-year rates for undergraduate and graduate loans rose slightly.

The US Treasury Department has announced that federal student loan rates will increase for the next academic year. These new rates will not have a direct impact on private student loan rates, but it is possible that private lenders will increase their rates now that their rates no longer need to be so low to compete with federal loans. You may see rates on refinanced student loans increase in the coming months.

Variable 5-Year Student Loan Refinance Rates

5-year variable undergraduate student loan refinance rates are 3.62% on average last week. This is an increase of 22 basis points for two weeks. Six months ago, this rate hovered around 2.59%.

5-year variable graduate loan refinance rates are down from two weeks ago. Currently, the average rate is 3.08%, which is still a bit higher than it was at this time last year.

Fixed 10-Year Student Loan Refinance Rates

Refinance rates on fixed 10-year undergraduate and graduate student loans last week are slightly higher than they were two weeks ago, with rates changing just six basis points. Rates have increased more significantly over the past six months.

Student loan interest rates by credit score

The rate you get when you refinance is heavily influenced by your

credit score

.. Usually, the better your credit score, the lower the rate you will receive. Below, we’ve listed the 10-year fixed student loan rates by credit score:

How to refinance a student loan

Check different companies and see your terms with each lender. Review the offers and determine the rate and term that suits you best. When you review your rates, lenders usually do a soft credit check, which doesn’t affect your credit score.

You must refinance through a private student lender because you cannot refinance a student loan through the federal government.

Once you have chosen a company, complete their application and verify your finances and identity. Once the lender has made their final offer, you will need to sign the agreement and agree to the terms. Then your new lender will pay off your existing loan and you’ll be ready to take out a new loan.

Should you refinance your student loan?

Refinancing your student loans can earn you a better interest rate, help you switch from a variable-rate loan to a fixed-rate loan, or change your term length. By changing the length of your term, you may be able to spread out payments over a longer period for smaller monthly payments, even though you’ll cough up more total interest.

Be careful before choosing to refinance a federal student loan. You will lose the main protections that come with federal loans if you refinance them. For example, you will no longer be eligible for the COVID-19-related student loan payment pause, currently in place until August 31, 2022, and federal student loan relief programs like the Service Loan Forgiveness. public.

You also won’t qualify for specific repayment options like income-contingent repayment plans, which take into account your specific income and family size when determining monthly payments.

Fixed rate vs variable rate loan

The interest rate on a fixed rate student loan never changes. The rate you get when you take out your loan is the rate the lender gets you until you pay off your loan in full.

A variable rate loan has an interest rate that the lender will change periodically during the term of your loan. Lenders typically tie this rate to specific market benchmarks impacted by the federal funds rate. Variable rates may start lower than fixed rates, but can increase significantly over the life of your loan.

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