3 ways to get a lower interest rate
How Can You Get A Lower Interest Rate On Your Business? Student Loans?
Here’s what you need to know.
1. Refinancing student loans
Student loan refinancing is the best way to get lower interest rates on your student loans. Student loan refinancing allows you to consolidate and refinance your current federal student loan, private student loan, or both into a new single student loan. Your new student loan has a lower interest rate which will help you save money, pay less interest, and pay off student loans faster. Plus, you only make one monthly payment and you have a student loan servicer. How is Student Loan Refinancing Approved? Student loan refinancing is best when you’re employed, have a stable monthly income, a credit score of at least 650, and enough monthly cash flow to meet your living expenses and student loan debt.
this Refinancing calculator for student loans shows how much money you can save by refinancing your student loan. Let’s say you have a $ 80,000 student loan, 8% interest, and a 10 year repayment period. if you refinance your student loans When you get a 3% interest rate and a 10 year term, you can cut your monthly payment by $ 198 per month and save a total of $ 23,776 over the life of your student loan.
Bonus: You can refinance your student loan as often as you like. There are no fees and it doesn’t matter if you’ve already refinanced. If you get a lower interest rate, you can refinance again.
2. Take out a new student loan
Student lending rates have fallen to their lowest level ever. Currently you can Refinance Student Loans at incredibly low prices. Likewise, you can borrow new student loans at the lowest rates ever. Each May, Congress (not the Department of Education) sets federal student loan interest rates for the upcoming school year based on an auction of 10-year treasury bills. Government bond yields plummeted last year due to several interest rate cuts by the Federal Reserve and Covid-19, among other things. The new interest rates apply from July 1, 2020 to June 30, 2021.
Student Loans (Subsidized and Unsubsidized)
- Current rate: 4.53%
- New tariff: 2.75%
Student Loans (Unsubsidized)
- Current rate: 6.08%
- New tariff: 4.30%
Parent PLUS Loans and Grad PLUS Loans (PLUS Loans)
- Current rate: 7.08%
- New tariff: 5.30%
Bonus: If you are thinking of going back to college or graduate school this fall, student loans are much cheaper.
3. Get an adjustable rate student loan
If you want lower interest rate on your student loans, choose a floating rate. When you refinance your student loan, you can choose between a fixed rate or a variable rate. While fixed rates never change, they tend to be higher than variable (and therefore more expensive). In contrast, floating rates, while lower, can change (either rise or fall) over time. The price difference can be significant. For example, you can now refinance your student loans from 1.99% if you opt for a variable interest rate. However, the lowest fixed rate currently with some lenders is around 3.20%. If you don’t think interest rates will go up in the short term, a floating rate can save you more money. If you want to know that your price will never change, a fixed price might be better. You can also choose a floating rate when you take out a new loan private student loan. Currently, interest rates are very low and therefore you can benefit from low interest rates both by refinancing a student loan and by taking out new student loans.
Bonus: If you want to save even more money, choose a shorter repayment term. When refinancing student loans, you can choose between a term of 5 to 20 years. If you want the lowest interest rate, choose the 5 year term. You get the lowest interest rate and you pay the lowest interest.