Definition
Replacing your private student loans with a new one, often to secure a lower interest rate or better repayment terms.
What to consider
- Shop around for better rates if you have multiple loans.
- Understand the differences between federal and private options.
- Review the new terms carefully before making a switch.
Real world scenarios
- Angela refinances her private student loans at a lower interest rate, saving hundreds per month. She uses these savings to boost her emergency fund.
- Noah consolidates scattered private loans into one new loan, simplifying his payments under a single servicer.
- Lenders evaluate Harriet’s improved credit score and job stability, offering more favorable refinancing terms than when she originally borrowed.
Related terms
Related Playbooks
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