Have you ever wondered if you can refinance your education loan when you do not have a degree? Well, the answer is yes. You can refinance your education loan without having a degree and get rid of those high-interest rates. This article will discuss how to do this in detail, so keep reading!
What does it mean to refinance a loan?
When you refinance a loan, you essentially take out a new one and use it to pay off your old one. This means that if you were paying back $100 per month on your original loan and now want to take out a new one at an interest rate of 2% instead of 10%, then your monthly payment will drop by 8%. This can be very helpful if the amount left over each month after paying off all other bills is limited.
How can loan refinance impact your current federal student loans?
Refinancing your loan may affect your current federal student loans.
- Your credit score will be affected by refinancing, for better or for worse. If you have excellent credit and are looking to refinance with a new lender, they’ll likely pull up your credit report and see what they’re working with. As long as there aren’t any major blemishes on your report—like missed payments or collections—this shouldn’t cause any problems when applying for a new loan.
- Changing interest rates might change the total amount of interest you pay over time. This depends on the length of time between when you took out the initial loan and now, but refinancing can make things affordable in the long term if you currently have high-interest debt from school loans. For example: if your interest rate is lower now than when you first started paying off your student loan(s), refinancing could save money for more years than not (depending on how much money was owed).
- Refinancing might increase monthly payments slightly but still lower them overall compared with keeping things as is; this all depends on which factors are most important to each individual borrower after considering their financial situation (and what kind of other debt they may already have).
What will happen to your income-driven repayment plans?
It doesn’t matter if you’re in an income-driven repayment plan. You can still refinance your loans with a private lender; it just won’t be through the federal government. This means that you’ll have to pay more interest on your student loans, but it’s a better option than not being able to afford them at all.
Can you refinance an education loan without a degree?
The answer is yes; you can refinance student loans without a degree. If you are a student who has completed your degree and has no plans to go back to school, then refinancing is a great option for you. However, if you are planning on returning to school soon or just want a lower education loan rate, it might not be worth refinancing yet.
“Lantern by SoFi can assist you to compare student loan refinance rates if you’re really interested in student loan refinancing.”
What types of student loans can be refinanced?
There are three types of student loans that can be refinanced:
- Federal Direct Loans
- Private loans
- Consolidation loans
Refinancing your student loans is a great way to save money on interest payments and get better terms on your debt. For example, if you have federal loans that are under the Income-Based Repayment (IBR) plan or Pay As You Earn (PAYE) program, there’s no reason not to try refinancing.