Student loan refinancing companies say they offer borrowers a way to save thousands of dollars on their debt, by allowing them to pay off their loans at a lower interest rate, in less time.
The reality can be much different.
Recently, the government found that online lender SoFi was misleading consumers on how much they'll save if they refinance their student debt with them.
The company's ads boasted average discounts of more than $22,000, but in its calculations the company excluded certain borrowers for whom refinancing resulted in a more expensive loan, the government found. In a settlement with the Federal Trade Commission, SoFi agreed to stop its misrepresentations.
SoFi spokeswoman Brielle Villablanca said the company has always been committed to giving its current and prospective members clear and complete information, in a statement to CNBC.