5-year variable-rate student loan refinance interest rates plunge below 3%

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The latest trends in interest rates for refinancing student loans from the Credible market are updated weekly. (iStock)

Rates for well-qualified lenders using the credible market to refinance student loans fell for 5-year variable-rate loans, while 10-year fixed-rate loans rose slightly.

For lenders with credit scores of 720 or higher who used the Credible Market to select a lender during the week of July 4, 2022:

  • Rates on 10-year fixed-rate refinancing loans averaged 5.36%, slightly higher from 5.34% the previous week and higher from 3.65% a year ago. Rates for this quarter reached their lowest point of 2021 during the week of November 22, when it was at 3.35%.
  • Rates on 5-year variable-rate refinancing loans averaged 2.51%, down from 3.23% the week before and lower from 3.05% a year ago. Rates for this quarter reached their lowest point of 2021 during the week of November 22, when it was at 2.41%.

Student loan refinancing weekly rate trends

If you are curious about what kind of student loan refinancing rates you may qualify for, you can use an online tool like Credible to compare options from different private lenders. Checking your rates will not affect your credit score.

Current student loan refinancing rates according to FICO score

To provide relief from the economic impact of the COVID-19 pandemic, interest and payments on federal student loans have been suspended until at least August 31, 2022. As long as that relief is in place, there is little incentive to refinance federal student loans. But many lenders with private student loans take advantage of the low interest rate environment to refinance their education debt at lower rates.

If you qualify to refinance your student loans, the interest rate you may be offered may depend on factors such as your FICO score, the type of loan you are seeking (fixed or variable rate) and the loan repayment term.

The graph above shows that good credit can help you get a lower rate and that rates tend to be higher on loans with fixed interest rates and longer repayment terms. Because each lender has its own method of evaluating lenders, it is a good idea to request rates from multiple lenders so that you can compare your options. A student loans refinancing calculator can help you estimate how much you can save.

If you want to refinance with bad credit, you may need to apply with a cosigner. Or you can work on improving your credit before applying. Many lenders will allow children to refinance older PLUS loans in their own name after graduation.

You can use Credible to compare rates from multiple private lenders simultaneously without affecting your credit score.

How rates for refinancing student loans are determined

The rates that private lenders charge to refinance student loans depend in part on the economy and interest rate environment, but also on the loan term, the type of loan (fixed or variable rate), the borrower’s creditworthiness and the borrower’s operating costs and profit margin. .

About credible

Credible is a multi-lender market that empowers consumers to discover financial products that best suit their unique circumstances. Credible’s integrations with leading lenders and credit bureaus enable consumers to quickly compare accurate, personalized loan options – without compromising their personal information or affecting their credit score. The credible market offers an unparalleled customer experience, as reflected by more than 5,000+ positive Trustpilot reviews and a TrustScore of 4.7 / 5.

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