Student loans can be great when you’re in university. They give you the freedom and funding to put all of your time into your coursework and into enjoying university life. But then, when the time comes to start paying them off, your loans can begin to feel like a massive and impossible financial burden. Lots of people find themselves barely getting by as a hefty portion of each paycheck gets eaten up by their student loan repayment plan. Finding yourself in this situation can feel utterly overwhelming and disheartening. When you’re trying to plan for a future home and family, the weight of a student loan can seem like an insurmountable obstacle to overcome.
Refinancing your student loan might just be the answer you were looking for. There are several great companies that offer refinancing options. Essentially, these companies give you a new loan that will be used to pay off any student loans you may have. By refinancing in this way, you’ll be left with only one loan to repay. The good news is these companies tend to offer much lower interest rates than you’d find with federal loans. Elfi, for instance, offers rates from as low as 2.39% APR, while the lowest federal rates start at 4.53% APR.
You’ll potentially be giving up some benefits by refinancing, such as your eligibility for loan forgiveness programs or income-based repayment. However, if you have a secure job and a good credit score, these are most likely not an option anyway. By refinancing, your loan repayments will immediately and permanently go down so you can focus on building up your savings. If you’re beginning to think about the future, a refinancing program will give you a solid financial footing. At Elfi, an average of $20,936 is saved overall, per person.
If you’re interested in learning more about Elfi’s specific student loan refinancing options. Their website will show you a sample repayment plan for a loan of $25,000, so you can see what your refinanced loan might look like. You can also find your own rate with a simple online form that will have no effect on your credit score. If the rate you find looks good, you can complete the application process online.
Whether refinancing is the right option for you is ultimately your decision. Of course, there are pros and cons either way. While the idea of smaller payments is enticing, it’s essential to weigh the pros and cons of each refinancing plan before you commit. Whatever your decision may be, the most vital part about repaying your student loan is to make sure that you do it. By not letting yourself get behind in repayments and by making your loan a financial priority, it will become less burdensome, and soon, it will become less of a daunting problem. As long as you don’t let your debt spiral out of control, you’ll always have the option to refinance if it’s the right option for you.