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Average interest rates on refinanced student loans have been mixed for two weeks, according to data compiled by Credible. Five-year undergraduate loan rates have fallen, while five-year graduate loan rates have increased. The same trend was seen in 10-year loans, with undergraduate rates falling and graduate rates rising slightly.
Although some rates fell last week, they are significantly higher than they were at the same time last year and should continue to rise. Federal student loan rates for the 2022-23 school year will see the biggest increase since 2005-06. While this will not directly impact private student loans, these rates will likely also increase to stay on par with federal loan rates.
Student loan refinance companies featured by Insider
Variable: 2.49% – 8.24%, Fixed: 4.24% – 8.49%
Variable: 2.49% – 11.97%, Fixed: 2.59% – 8.74%
Variable (with autopay discount): 2.49% – 7.99% APR, Fixed (with autopay discount): 3.74% – 8.49% APR
Variable 5-Year Student Loan Refinance Rates
Undergraduate loan rates have fallen 64 basis points over the past week, leaving them 15 basis points above where they were six months ago and just over 1% higher than they were at the same time last year.
Graduation rates rose 94 basis points last week. They are 33 basis points above where they were six months ago and 81 basis points higher than 12 months ago.
Fixed 10-Year Student Loan Refinance Rates
Undergraduate rates on 10-year fixed loans have fallen slightly since last week, while graduate rates have risen.
Undergraduate rates fell 31 basis points, leaving them 1.93% higher than they were at the same time last year. Graduation rates rose 26 basis points and are up 2.27% from 12 months ago.
Student loan interest rates by credit score
Your interest rate will generally improve with a higher credit score – we show this in the table below. We give you the 10-year fixed student loan rates by credit score:
Frequently Asked Questions
You will not be eligible for any type of loan forgiveness if you refinance your federal student loans. The Biden administration is set to forgive up to $10,000 in student debt for borrowers earning less than $125,000 a year and up to $20,000 for Pell Grant recipients.
All types of federal loans will be eligible for forgiveness, but private student loans will not be affected. Married couples or heads of households earning less than $250,000 will also be eligible for assistance.
Refinancing federal student loans may seem smart if it gives you a lower interest rate, but it will disqualify you for loan forgiveness.
Refinancing your student loans can lower your rate. You can also switch from a fixed rate loan to a variable rate loan or change the term of your loan. The increased time you have to pay off your loan may lower your monthly payments, but you’ll pay more total interest.
The best barometer of loan approval is usually your credit score and history. Lenders appreciate the reliable repayment history of your loans on time. The better your credit score, the more likely you are to qualify for a low rate as well. Plus, most lenders will do a soft credit check when you apply (which doesn’t affect your credit score), so you can find out from an individual lender if you’ll be approved without hurting yourself.
If you want a better interest rate and are able to pay off your loan quickly, a five-year loan could be a great choice. You’ll save money in interest and free up money to reach your other financial goals faster.
A 10-year loan term will cost you more overall, but you’ll make lower monthly payments. This can make it easier to pay off your loan on a tight budget.