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Twenty-five to 34-year-olds make up the biggest cohort of student loan borrowers, adding up to 14.8 million borrowers in total. The average individual in this age bracket has a student loan balance of $33,817.56, according to statistics from the U.S. Department of Education's Q4 2020 data.
While this number is just shy of how much the average student loan borrower of all ages carries ($39,351), it's more than double what the 24-and-younger cohort is dealing with (their average balance is $14,807.69).
The jump in outstanding debt can be attributed in part to the additional years of interest that 25- to 34-year-olds are paying compared to those under 25, as well as additional loans that they may have taken out to fund additional schooling.
If you're in the 25-to-34 age group and struggling with five-figure debt (or more), you can find some comfort in knowing it's not too late to get a handle on it. Ahead, Select offers some advice on managing your student loans.
Your mid-20s and early 30s mark a significant chapter in your adulthood — whether you're advancing in your career or getting married and planning a family — and these are opportune moments to prioritize a plan for paying down your student debt.
For example, as you grow in your career, your salary may allow you to make more than just the minimum payment on your monthly student loan bill. As you get married and prepare to start a family, now is the time to focus on trimming down your student loan debt before tacking on competing expenses, like a monthly mortgage payment and child care.
One way to pay your student loans off faster is to refinance them through a private lender. Borrowers with good credit can likely score a lower interest rate and also choose their new loan repayment term.
If you have the extra funds to put more money toward your debt payoff, you can shorten your loan term from 10 years to five, for example, or whatever makes sense for your finances and your outstanding loan balance. A shortened timeline would mean higher monthly payments, but with a lower interest rate and the abbreviated loan term, you can accelerate your debt payoff and save money in the long run.
Select ranked the best student loan refinancing options to help you simplify your search. They all offer a wide selection of loan terms and interest rates to choose from, charge no application or origination fees, have zero prepayment penalties and offer flexible repayment terms, economic hardship payment options and autopay interest rate reductions. (See our methodology for more information on how we chose the best student loan refinance companies.)
- Best overall: SoFi Student Loan Refinancing
- Best for having a co-signer: CommonBond Student Loan Refinancing
- Best for fair credit score: Earnest Student Loan Refinancing
- Best for parent loan refinancing: Education Loan Finance Student Loan Refinancing
- Best for medical school loan refinancing: Laurel Road Student Loan Refinancing
We do not recommend that federal student loan borrowers refinance while the payment and interest freeze is in effect, currently through Sept. 30, 2021. Once the federal student loan pause is up, consider what federal protections you'll lose if you choose to refinance privately. Private student loan borrowers, on the other hand, should consider refinancing if their interest rate is high, especially in this low-rate environment.
To determine which student loan refinance companies are the best for borrowers, Select analyzed and compared private student loan funding from national banks, credit unions and online lenders. We narrowed down our ranking by only considering those that offer low student loan refinancing rates and prequalification tools that don't hurt your credit.
While the companies we chose in this article consistently rank as having some of the more competitive interest rates for refinancing, we also compared each company on the following features:
- Broad availability: All of the companies on our list refinance both federal and private student loans, and they each offer a variable and fixed interest rate to choose from.
- Flexible loan terms: Each company provides a variety of financing options that you can customize based on your monthly budget and how long you need to pay back your student loan.
- No origination or signup fee: None of the companies on our list charge borrowers an upfront "origination fee" for refinancing your loan.
- No early payoff penalties: The companies on our list do not charge borrowers for paying off loans early.
- Streamlined application process: We made sure companies offered a fast online application process.
- Co-signer options: Each company on our list allows for a co-signer if the direct borrower does not qualify for refinancing on their own.
- Autopay discounts: All of the companies listed already calculate autopay discounts into their advertised rates.
- Private student loan protections: Though you lose federal student loan benefits when you refinance, each company on our list offers some type of their own financial hardship protection for borrowers.
- Loan sizes: The above companies refinance loans in an array of sizes, from $5,000 to $500,000. Each company advertises its respective loan sizes, and completing a preapproval process can give you an idea of what your interest rate and monthly payment would be.
- Credit requirements/eligibility: We took into consideration the minimum credit scores and income levels required if this information was available.
- Customer support: Every company on our list provides customer service available via telephone, email or secure online messaging. We also opted for lenders with an online resource hub or advice center to help you educate yourself about the student loan refinancing process.
After reviewing the above features, we sorted our recommendations by best for overall refinancing needs, having a co-signer, applying with a fair credit score, refinancing parent loans and medical school loans.
Note that the rates and fee structures for private student loan refinancing are not guaranteed forever; they are subject to change without notice and they often fluctuate in accordance with the Fed rate. Choosing a fixed-rate APR when you refinance will guarantee that your interest rate and monthly payment will remain consistent throughout the entire term of the loan.
Your refinanced rate depends on your credit score, income, debt-to-income (DTI) ratio, savings, payment history and overall financial health. To refinance your student loan(s), lenders will conduct a hard credit inquiry and request a full application, which could require proof of income, identity verification, proof of address and more.
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