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Becoming a veterinarian can be a very lucrative career path. The median starting salary for veterans entering corporate practice was $106,053 in 2021, according to the American Veterinary Medical Association. But even with a salary that size, it can take a while to pay off your student debt.
If you’re looking for ways to pay off your vet school loans faster, refinancing could be a solid option. Here’s how to find out if it’s the right choice for you.
By visiting Credible, you can Learn more about student loan refinancing. and compare rates from various private student loan lenders.
How to Refinance Veterinary School Loans
Refinancing vet school loans works the same way as refinancing other student loans. It involves converting several federal or private student loans into a new private loan, ideally with a better interest rate.
If the majority of your loans are federal student loans, it is better to consolidate them into a Direct Consolidation Loan rather than refinance them. A Direct Consolidation Loan comes with income-based reimbursement options, leniency and access to student loan forgiveness programs If you decide to refinance federal student loans with a private lender, you will lose those federal protections.
Whichever option you choose, the process for refinancing your loans works like this:
- Find the best rate. Get quotes from three to five lenders to ensure you get the best rate.
- Choose a lender. Once you have the quotes in hand, choose the lender that best suits your needs.
- Fill out a loan application. Answer questions related to your personal information, income and your existing debt.
- Sign the paperwork. If you are approved, you will read the loan documents and sign on the dotted line.
- Start making payments on your new loan. Once the paperwork has been signed, the lender will disburse the funds. Please continue to make payments on your existing loans until you receive written confirmation that they have been paid off. You will then begin making payments on your new loan.
Requirements for Refinancing Veterinary School Loans
Private student loan companies set their own requirements for refinancing, so they may differ from lender to lender. But, in general, lenders will look at the following:
- Sufficient work history — Your lender will look at your work history to make sure you are able to make your loan payments.
- good credit score — Lenders look at your credit score as an indicator of how likely you are to repay the loan. If your credit needs some work, apply with a co-signer with good credit to increase your chances of being approved and getting a better rate.
- Decent debt-to-income ratio — Lenders also look at your debt to income ratio, which is a measure of how much income you have compared to your existing debt, before you are approved for a loan. This helps them determine if you have enough income to handle an additional debt payment.
you can easily compare prequalified rates from multiple lenders using Credible.
What to Consider About Vet School Refinancing
Like any other financial decision, refinancing vet school loans has pros and cons.
Advantages of refinancing
- You could save money. Depending on current interest rates and the new term of your loan, there’s a good chance that refinancing could lower your monthly payment.
- You will only have a single payment. If juggling multiple payments is difficult for you, refinancing can help you streamline them into one payment.
Cons of refinancing
- You will lose the benefits of the federal loan. If you refinance federal student loans with a private lender, you will lose access to federal benefits like postponementforbearance and student loan forgiveness programs.
- You may have to meet some high financial requirements. Refinancing with a private lender usually means meeting strict financial requirements with your credit score and debt to income ratio. But you can always apply with a co-signer to help strengthen your financial profile.
Best lenders to refinance veterinary school loans
While there aren’t many lenders that specialize in refinancing veterinary school loans, most lenders that refinance student loans will accept loans for veterinary programs. When evaluating potential lenders, consider the following criteria:
- Interest rate — Look at the lowest rate each lender offers and whether they offer a fixed rate or a variable rate.
- loan term — It’s important to consider how long your repayment period will be, so you can plan how long you’ll make loan payments. Consider what different payment options are available to you.
- Maximum loan balance — Find out whether or not you can borrow enough to cover your current debt.
- Rate — Make sure you know the fees the lender will charge you to refinance your student loan debt.
- Discounts — If the lender offers discounts, see which ones you’ll qualify for. For example, many lenders offer a rate discount if you set up automatic payments.
- Cosigners — If you think you will need a cosignerCheck to see if the lender offers the ability to release your co-signer after you’ve made a certain number of payments.
Alternatives to refinancing
If you don’t think refinancing your vet school loans is right for you, here are some alternatives to consider. Keep in mind that these options won’t help you pay off your loans faster, but they might make your monthly payments more manageable.
- Income-Based Payment Plans — Federal student loan borrowers have the option of choosing an income-based repayment plan, which limits your monthly payment to a percentage of your current taxable income and household size.
- Tolerance – Forbearance temporarily stops your student loan payments, but interest continues to accrue on your loans and will be added to your principal balance at the end of the forbearance term.
- Postponement — Loan deferment also temporarily stops your payments, though usually for a longer period of time than forbearance. You may need to have a qualifying life event to qualify for the deferment. For federal loans, the federal government will stop accruing interest while it’s in deferment.
To start refinancing your student loans, visit Credible and compare prequalified rates from multiple lenders.