Can You Refinance Sallie Mae Student Loans? - NerdWallet (2024)

FAQs

Is it possible to refinance a Sallie Mae loan? ›

We don't offer consolidation or refinancing at this time. We recommend that you consider the impact that these actions may have on your student loan benefits and Total Loan Cost.

If you're experiencing financial hardship, you could contact Sallie Mae to see if it would be willing to forbear or reduce your payments temporarily. However, this is only a short-term fix. Generally, the only way to permanently reduce your loan payment is to refinance your loan.

Today's loan refinance rates are significantly higher, making it more difficult to find substantial enough savings through refinancing to justify the loss of the federal protections, including loan forbearance and the ability to access federal income-driven repayment plans.

In rare cases, loan forgiveness or discharge may be available. Can You Get Out of a Sallie Mae Loan? Yes, you can get out of a Sallie Mae loan you've already borrowed in certain situations, such as becoming totally disabled, negotiating a settlement, or filing for student loan bankruptcy and receiving a discharge.

While Sallie Mae does not offer refinancing, other private lenders do, including SoFi. These companies essentially purchase your existing student loans and offer you a new loan to pay them off, with a new interest rate and new terms. Private and federal loans are both able to be refinanced into a private loan.

If your payments aren't up to date, your account can go into default. At that point, you have to pay the entire amount owed, plus fees. The servicer or loan lender can send your account to collection. For federal loans, the servicer also has the right to take the balance of your payments from your wages.

Can you discharge Sallie Mae student loans in bankruptcy? Yes, Sallie Mae student loans, many of which are now managed by Navient (and recently renamed Aidvantage), can be discharged in bankruptcy, but it's not an easy process.

Loan amount changes can be requested by the borrower, cosigner, or school at various points in the application process. The borrower or cosigner can contact us to request to increase the loan amount.

College students are regretting taking out student loans before they even leave school, a new report from WalletHub revealed on Tuesday. Roughly 61 percent of college students said they regretted how much they borrowed with student loans, according to the report.

Why do I keep getting denied to refinance student loans? ›

Payment and Credit History

Credit isn't the only factor in whether you get approved or denied. The lender will also pay special attention to your payment and credit history. If you've missed several payments in the past or made a late payment, student loan refinance lenders are more likely to reject your application.

Key takeaways. In order to refinance a student loan, lenders tend to require a strong credit score, a stable income, a degree and a decent debt-to-income ratio. Lenders require a minimum refinancing amount, which is the amount you still have to pay on the loan. This is so the lender can make enough interest.

If you took out Sallie Mae loans to pay for college, you can — and probably should — refinance with another lender if it will save you money. Though borrowers can't refinance loans directly with Sallie Mae, there are several other lenders that will allow you to prequalify without affecting your credit score.

At the time, the company was accused of steering student borrowers into expensive forbearances instead of more flexible, income-driven repayment plans. The company also faced allegations that its former owner, Sallie Mae, had made subprime private loans to vulnerable borrowers who it knew were likely to default.

A False Claims suit was filed against Sallie Mae by former U.S. Department of Education researcher, Dr. Oberg, in 2009. The suit alleges that Sallie Mae and other lenders deliberately overcharged the U.S. government. The findings by Oberg were labeled among higher education policy analysts as the 9.5 scandal.

Ideally, your new loan will have a lower interest rate and better terms than your previous loans, making it easier and more affordable to pay back what you owe. Refinancing is available for both federal and private student loans, although the process may differ depending on which loan types you have.

In general, you'll need to have a credit score in the mid- to high 600s, a debt-to-income ratio of less than 43 percent and a source of steady income to refinance a student loan, but the requirements vary by lender. Getting pre-qualified is an excellent way to see if you're eligible for student loan refinancing.

For most federal student loans, the grace period lasts six months after you leave school. Note: Repayment can kick in after six months of being less than a half-time student. It's important that you check with your loan servicer for the exact date your first loan payments are due.

Whether you're considering pursuing forgiveness through IDR or PSLF, be aware that only federal student loans qualify for forgiveness through these programs. That means if you refinance federal loans through a private lender, you will no longer be eligible for these federal student loan forgiveness programs.