Good News: Student Loan Refinance Rates Fall for 5- and 10-Year Loans

Good News: Student Loan Refinance Rates Fall for 5- and 10-Year Loans

Our goal here at Credible Operations, Inc., NMLS Number 1681276, referred to as “Credible” below, is to provide you with the tools and confidence you need to improve your finances. Although we endorse products from our lending partners that compensate us for our services, all opinions are our own.

The latest trends in student loan refinancing rates from the Credible Marketplace, updated weekly. (istock)

Rates for well-qualified borrowers who use the Credible marketplace to refinance student loans fell this week for both 10-year fixed-rate and 5-year variable-rate loans.

For borrowers with credit scores of 720 or higher who used the Credible marketplace to select a lender during the week of September 12, 2022:

  • Rates on 10-year fixed-rate refinance loans averaged 5.50%, down slightly from 5.56% a week earlier and up from 3.49% a year ago. Rates for this term hit their lowest point of 2022 so far in the week of January 10, when they stood at 3.44%.
  • Rates on 5-year variable rate refinance loans averaged 3.85%, down significantly from 4.53% the previous week and up from 2.95% a year ago. Rates for this term hit their lowest point in 2022 so far in the week of July 4, when they stood at 2.51%.

Weekly Trends in Student Loan Refinance Rates

If you’re curious about what kind of student loan refinancing rates you may qualify for, you can use an online tool like Credible to compare options from different private lenders. Checking your rates will not affect your credit score.

Current Student Loan Refinance Rates by FICO Score

To provide relief from the economic impacts of the COVID-19 pandemic, interest and payments on federal student loans have been suspended until at least December 31, 2022. While that relief is in effect, there is little incentive to refinance federal student loans. But many borrowers with private student loans are taking advantage of the low interest rate environment to refinance their education debt at lower rates.

If you qualify to refinance your student loans, the interest rate you may be offered may depend on factors such as your FICO score, the type of loan you are seeking (fixed or variable rate), and the loan repayment term.

The chart above shows that good credit can help you get a lower rate and that rates tend to be higher on loans with fixed rates and longer payment terms. Because each lender has its own method for evaluating borrowers, it’s a good idea to request rates from multiple lenders so you can compare your options. A student loan refinance calculator can help you estimate how much you could save.

If you want refinance bad credit, you may need to apply with a co-signer. Or, you can work on improving your credit before you apply. Many lenders will allow children to refinance Parent PLUS loans in their own name after graduation.

You may use Credible to compare rates from multiple private lenders at once without affecting your credit score.

How Rates are Determined for Student Loan Refinancing

The rates private lenders charge to refinance student loans depend in part on the economy and interest rate environment, but also on the term of the loan, the type of loan (fixed or variable rate), the creditworthiness of the borrower, and the operating costs and the lender’s profit margin. .

About Credible

Credible is a multi-lender marketplace that allows consumers to discover the financial products that best fit their unique circumstances. Credible’s integrations with leading lenders and credit bureaus allow consumers to quickly compare accurate and personalized loan options, without risking their personal information or impacting their credit score. Credible Marketplace provides an unrivaled customer experience, as evidenced by over 5,000 positive Trustpilot reviews and a TrustScore of 4.7/5.

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