Refinance Options

Notes & explanations

1. Compare remaining cost, not original cost. Refinancing replaces an existing obligation with a new one. Compare what remains to be paid under the current arrangement against the new payments and fees. A lower monthly payment can still mean a higher total cost. ↩ Back to text

2. Compare the full repayment cost. Compare the whole scheduled repayment, not just the monthly payment. A longer term can lower each payment while increasing interest overall. Separately paid fees and late or optional charges need their own treatment. ↩ Back to text

3. How fees affect the comparison. A fee may be deducted from the amount sent to you, financed into the balance, or paid separately. These treatments change the comparison differently. Check the written disclosure and count each charge once. ↩ Back to text

4. A simple break-even has limits. Dividing upfront costs by monthly payment savings estimates a cash-flow break-even only when savings are positive. It does not account for every difference in loan term, risk, future rate changes or benefits surrendered. ↩ Back to text

5. Private refinancing can give up federal rights. Moving federal student debt into a private loan gives up federal loan benefits and protections. This is not the same as federal Direct Consolidation. Compare those consequences before focusing on a new rate. ↩ Back to text

6. The asset at risk. Collateral is property pledged to secure repayment. A lower quoted payment or rate does not remove the risk to that asset if the borrower defaults. Read which asset is pledged and the remedies described in the agreement. ↩ Back to text