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Home Student Loans Student Loan Refinance Repayment Plans for Federal Student and Parent Loans Is Private Student Loan Forgiveness Real?
  • Contents
  • Evaluate Your Personal Financial Health
  • Do You Have Federal Student Loans? Seek Federal Student Loan Forgiveness First
  • Ask About Employer-Sponsored Student Loan Repayment
  • Student Loan Refinance
  • Compare Top Refinance Lenders
  • Private Student Loan Discharge
  • Can Student Loans Be Included in Bankruptcy?
  • Ask Your Family to Help

Is Private Student Loan Forgiveness Real?

Photo of Elaine Rubin
By Elaine Rubin
Updated on September 26, 2022
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Let’s be honest. We’ve all encountered a feeling of being overwhelmed with our finances and may have considered every possible remedy that exists to get out of our rut. But in our haze we must be careful to not fall for “fake news” or urban legends. Private student loan forgiveness does not exist; at least not in the traditional sense.

If you’re serious about getting free from the weight of crushing private student loan debt, we can help. Here are some options.

Evaluate Your Personal Financial Health

You financial health is made up of a lot of different components. It may be your student loan payments that are keeping you up at night, but it’s worth it to examine all your finances. How much you are earning, what you have in savings, as well as where are you spending your money.

Do you have private student loans and federal student loans? Do you have subscription services you can live without? Or is it finally time to downgrade that cable package? Create a budget and clearly identify where your money is going.

Once you go through it all, see where you can make changes. No change is too small, lots of small changes may make a large impact.

Do You Have Federal Student Loans? Seek Federal Student Loan Forgiveness First

While private student loan forgiveness does not technically exist, federal student loan forgiveness does. If you’ve borrowed federal loans, you may remember your entrance or exit loan counseling sessions (extra points if you read through your promissory note). You may recall that it is possible to discharge your federal student loans through programs such as Public Service Loan Forgiveness and Teacher Loan Forgiveness. These are options that exist in the Direct Loan Program. Additionally, there are loan forgiveness programs for certain government jobs and agencies. Plus, there are additional options for military personnel, AmeriCorps and Peace Corps volunteers, individuals participating in Income-Driven Repayment Plans, and more.

Pursuing forgiveness options that exist within the federal student loan program is a great way to help alleviate debt stress, because you’ll free up at least one source of financial burden.

Ask About Employer-Sponsored Student Loan Repayment

According to New York Fed’s Quarterly Report on Household Debt and Credit (dated May 2019), Americans owe $1.5 trillion in student loan debt, with 11% of that debt being 90+ days delinquent. And not all of this debt is held by Millennials. There are also plenty of parents who borrowed PLUS loans to help pay for college. What this means is the workforce has been crying out for help in the form of additional employer benefits. And a number of big firms—including Aetna, Fidelity, and PwC—have answered the call. States like Tennessee are even jumping on the bandwagon by offering a $50 per month contribution to assist employees with their student loan repayment. As more companies evaluate employee benefits, it is likely we will see an increase in the number of employers who offer this perk.

Your immediate action item is to ask your employer if this is something they currently offer. Many employers may offer a tuition reimbursement program, but it never hurts to ask if considerations may be made to extend this benefit to student loan repayment.

Could student loan refinancing save you money?
Learn More

Student Loan Refinance

Student loan refinance (a.k.a. private student loan consolidation) is a great way to restructure private loan debt. In addition to combining multiple loans together—including federal loans, should you choose to include them—a refinance allows you to shop around for a lower interest rate. And, depending on your loan balance, it is quite likely that you can extend your repayment term, thereby lowering your monthly payment. If you’re overwhelmed and looking for breathing room in your budget, this could be a viable solution.

If this is an option you would like to pursue, you will need to qualify. A private student loan refinance will require you to have strong credit, proof of employment, and a good debt-to-income ratio. If you need to, you do have the option to apply with a cosigner.

Compare Top Refinance Lenders

Lender

College Ave Student Loans

Recommendation
Best for Student Loan Refinancing
Repayment Terms

5, 10, or 15 years2

Interest Rates

Variable as low as: 5.99% APR1

Fixed as low as: 5.99% APR1

Apply Now More Info
College Ave Student Loans

College Ave Student Loans

  • Variable rate range: 5.99% – 11.99% APR1
  • Fixed rate range: 5.99% – 11.99% APR1
  • No application or prepayment fees
  • Apply in 3 minutes or less for instant credit decision

College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC.. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.

1The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation.

2This informational repayment example uses typical loan terms for a refi borrower who selects the Full Principal & Interest Repayment Option with a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.

3$5,000 is the minimum requirement to refinance. The maximum loan amount is $250,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees.

Information advertised valid as of 03/01/2023. Variable interest rates may increase after consummation. Approved interest rate will depend on the creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.

Lender

Nelnet Bank Logo

Recommendation
Best for Student Loan Refinancing
Repayment Terms

Multiple terms available

Interest Rates

Variable Rates between 6.59% - 13.25% APR1

Fixed Rates between 4.49% - 9.44% APR1

Apply Now More Info
Nelnet Bank Logo

You Put in the Work. Now Reap the Rewards.

  • Variable Rates between 6.59% - 13.25% APR1
  • Fixed Rates between 4.49% - 9.44% APR1
  • No application or prepayment fees
  • Cosigner release with 24 consecutive on-time payments2

Nelnet Bank Logo

1Interest Rates

Fixed interest rates range from 4.49% APR (with auto debit discount) to 9.44% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. The fixed interest rate will remain the same for the life of the loan.

Variable interest rates range from 6.59% APR (with auto debit discount) to 13.25% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. Variable rates may increase after consummation. Variable rates for Nelnet Bank Refinance Loans are calculated as the One-Month SOFR plus the applicable Margin percentage. Variable rates will be based on the highest One-Month SOFR as published by the Federal Reserve Bank of New York and/or the Wall Street Journal “Money Rates” table on the twenty-fifth day (or the next business day) of the immediately preceding calendar month. The variable rate may change on the first day of each month if the SOFR index changes. This may result in higher monthly payments. The current One-Month SOFR index is 4.32% as of January 1, 2023.

Auto Debit Interest rate reduction of .25% for automatically withdrawn payments from any designated bank account (“auto debit discount”). Auto debit discount applies when full payments (including both principal and interest) are automatically drafted from a bank account. The auto debit discount will continue to apply during periods of approved forbearance or deferment if the auto debit discount was in effect at the time of receiving the forbearance or deferment. Auto debit discount will remain on the account unless (1) the automatic deduction of payments is canceled or (2) there are three consecutive automatic deductions returned for insufficient funds at any time during the term of the loan.

The lowest rate for each loan type requires automatically withdrawn (“auto debit”) payment. The lowest rate is available only to the most creditworthy applicants. Not all borrowers will receive the lowest rate. The interest rate and Annual Percentage Rate (APR) may be higher depending upon (1) the credit history of the borrower and, if applicable, the cosigner, (2) the repayment option and loan term selected, (3) the loan type selected, and (4) the highest level of education attained. If approved, applicants will be notified of the rate qualified for within the stated range.

2Cosigner Release. A request for the cosigner to be released can be made by either the borrower or cosigner when each of the following conditions has been met:

  • The account must have been in full principal and interest repayment for at least 24 months.
  • Twenty-four consecutive, on-time principal and interest payments, or lump sum equivalent, must have been made. NOTE: A lump sum payment does not replace the requirement to have been in full principal and interest repayment for at least 24 months. Interest-only or fixed-pay payments while enrolled in school do not qualify towards the 24 consecutive on-time payments.
  • The loan must be current at the time of request.
  • The loan must not have been in deferment, hardship forbearance, or other alternative payment assistance plan within the past 24 months.
  • The loan must not have been permanently modified from its original terms in the credit agreement.
  • The primary borrower must be a U.S. citizen or have permanent residency in the United States.
  • The primary borrower must meet the age of majority requirement in their permanent state of residency.

Requirements are subject to change. If all of these conditions have been met, then an application for cosigner release may be submitted. The primary borrower is required to demonstrate they have the ability to assume sole responsibility for the loan(s) by providing proof of income, meeting debt-to-income requirements, and having a satisfactory credit history. (A credit report will be obtained during the review process).

3Refinance Loan Eligibility: You must be a U.S. citizen or permanent resident alien with a valid U.S. Social Security number, and be the legal age to enter into binding contracts in your state/territory of residency, or be at least 17 years of age and apply with a cosigner who is at least the age of majority in their state/territory. Non-residents can apply with an eligible cosigner who is a U.S. citizen or permanent resident alien with a valid U.S. Social Security number. The student loans you refinance must be in their grace or repayment period, and you can no longer be enrolled in school on a half-time or more basis. You must have at least $5,000 in student loans to refinance. You, or your eligible cosigner, must have an annual income of at least $36,000. Approval subject to credit review. Other credit criteria may apply.

Refinance Loan Limits:

Minimum loan amount: $5,000

Maximum student loan limits:

$125,000 for borrowers with an undergraduate degree.

$175,000 for borrowers with a graduate, MBA, or law degree.

$500,000 for borrowers with a graduate health professional degree.

Nelnet Bank, and any associated logos or design marks, are trademarks or service marks of Nelnet, Inc. All loan programs and terms are subject to change or may be discontinued at any time without notice. Certain restrictions and limitations may apply.

Lender

ELFI Student Loan Refinance

Recommendation
Best for Student Loan Refinancing
Repayment Terms

5 - 20 years2

Interest Rates

Variable as low as: 5.03% APR1

Fixed as low as: 5.08% APR1

Apply Now More Info
ELFI Student Loan Refinance

ELFI Student Loan Refinance

  • Customers are saving an average of $309 every month and an average of $20,936 in total savings after refinancing their student loans with Education Loan Finance1
  • Variable and fixed rates starting from 5.03% APR and 5.08% APR2
  • Prequalify in as little as two minutes
  • Award winning customer service from your dedicated Student Loan Advisor who is matched to you from the moment you sign up
ELFI Student Loan Refinance

1Average savings calculations are based on information provided by SouthEast Bank/ Education Loan Finance customers who refinanced their student loans between 8/16/2016 and 10/25/2018. While these amounts represent reported average amounts saved, actual amounts saved will vary depending upon a number of factors.

2Rates accurate as of 06/01/23. The interest rate and monthly payment for variable rate loans may increase after closing. Your actual interest rate may be different from the rates shown above and will be based on the term of your loan, your financial history, and other factors, including your cosigner’s (if any) financial history. For example, a 10 year loan with a fixed rate of 6% would have 120 payments of $11.00 per $1,000 borrowed. To qualify for refinancing or student loan consolidation through Education Loan Finance, you must have at least $10,000 in qualified student loan debt and must have earned a bachelor’s degree or higher from an approved post-secondary Education Loan Finance institution. Education Loan Finance Parent Loans are limited to a maximum of the 10-year term.

Lender

SoFi Student Loan Refinance

Recommendation
Best for Student Loan Refinancing
Repayment Terms

5, 7, 10, 15, 20 years

Interest Rates

Variable as low as: 5.09% APR1

Fixed as low as: 4.49% APR1

Apply Now More Info
SoFi Student Loan Refinance

SoFi Student Loans

  • Rates as low as 5.09% variable and 4.49% fixed1
  • No fees or prepayment penalties
  • Unemployment protection

Private student loans lenders: SoFi Student Loan Refinancing

1Fixed rates range from 4.49% APR to 8.99% APR with a 0.25% autopay discount. Variable rates from 5.09% APR to 8.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.

Lender

Splash Financial Logo

Recommendation
Best for Student Loan Refinancing
Repayment Terms

5, 10, or 15, 20 years

Interest Rates

Variable as low as: 4.74% APR1

Fixed as low as: 4.96% APR1

Apply Now More Info
Splash Financial Logo

Splash Financial Refinance Loan

  • Rates as low as 4.74%1 Variable APR and 4.96%1 Fixed APR
  • No pre-payment penalties, origination, or application fees
  • See rates in 3 minutes without affecting your credit score2

1The rates displayed may include a 0.25% autopay discount.

2To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Lender

refinance student loans with earnest

Recommendation
Best for Student Loan Refinancing
Repayment Terms

5, 10, 15, or 20 years

Interest Rates

Variable as low as: 5.32% APR (with Autopay)*

Fixed as low as: 4.96% APR (with Autopay)*

Apply Now More Info
refinance student loans with earnest

Earnest Student Loan Refinancing

  • Variable rates starting at 5.32% APR (including 0.25% Auto Pay discount)*
  • Fixed rates starting at 4.96% APR (including 0.25% Auto Pay discount)*
  • Choose your own monthly payment
  • No fees of any kind and exceptional customer service for the life of your loan
  • Check your rate in under 2 minutes
refinance student loans with earnest

To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.

Actual rate and available repayment terms will vary based on your income. Fixed rates range from 5.21% APR to 9.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 5.57% APR to 9.19% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.

*Auto Pay Discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance. Not all borrowers will qualify for our lowest rates, and your rate will be based on creditworthiness at time of application.

The information provided on this page is updated as of 06/01/2023. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice.

Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 303 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, e-mail us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.

THIS IS AN ADVERTISEMENT. YOU ARE NOT REQUIRED TO MAKE ANY PAYMENT OR TAKE ANY OTHER ACTION IN RESPONSE TO THIS OFFER.

 

Call Your Private Student Loan Lender

If you are experiencing difficulty repaying your private student loans, we highly encourage you to contact your lender. Many lenders offer some type of temporary hardship relief. You may be eligible for a deferment or forbearance, for example. It’s true that the time limit is not as generous as the federal program, but a limited deferment or forbearance term may be an option. Plus, it’s always best to communicate proactively and explain your current situation to your lender(s) so they can help you find a solution, even if it’s temporary. There’s a lot at stake if you miss payments, including taking a hit to your credit score. Getting ahead of any issues you’re facing is critical to avoiding larger issues.

Private Student Loan Discharge

Now, when it comes to student loan discharge (a term used when something bad has happened), there may be some options. Private student loan lenders may offer a loan discharge (aka cancellation) in cases of the borrower’s death or disability. The best thing to do, contact the loan servicer to discuss the borrower's situation. Even if this benefit was not included in the loan’s terms and conditions, most lenders have a compassionate review process, where they review requests for financial relief on a case-by-case basis.

Can Student Loans Be Included in Bankruptcy?

Since this article attempts to debunk urban legends around private student loan forgiveness, we need to address another popular myth…bankruptcy. You may be under the impression—or heard rumors—that it is possible to discharge student loans in a bankruptcy proceeding. The reality is it’s not likely. For most bankruptcy proceedings, you typically cannot include any student loans. In fact, it’s nearly impossible.

Simply filing a Chapter 7 or Chapter 13 bankruptcy and including student loans as part of your overall indebtedness is not sufficient. Obviously, if you may be entertaining or pursuing a bankruptcy, we encourage you to consult an attorney. But note the standards imposed by the U.S. Bankruptcy Code require you to demonstrate that the repayment of a “qualified education loan” would impose an undue hardship to you and your dependents. And this would also be subject to an adversarial proceeding, which means the lender(s) may challenge it. Historically, borrowers seldom win the fight to include student loans in a bankruptcy filing. So, does this ultimately mean student loans can be included in bankruptcy? Legal counsel can answer that far better than we can.

Ask Your Family to Help

Okay, this one is a bit touchy. Asking family (or friends) to help doesn’t necessarily mean that you invite them to write a check each month. You can start with the simple things that allow you to maximize your budget while seeking their support in the process. For example, instead of doing gift exchanges during the holidays, implement alternative gifting options or expressions that don’t require spending money. Or if someone is inclined to splurge on you for your birthday, respectfully ask that they give you an option to trade the value for payment towards your loan debt instead. When loved ones understand that you’re trying to get ahead and fulfill your student loan obligations, they may be more than happy to help you out in some small way.

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Edvisors provides expert advice on planning and paying for college. On Edvisors.com easily compare student loan lenders, learn how to apply for financial aid, and discover scholarships. Learn about federal and private student loans for students and parents, how and when to apply to college, and more!

Edvisors (“Edvisors Network, Inc.”) provides independent advertising-supported platforms for consumers to search compare and apply for private student loans. Loan offers from participating lenders that appear on our websites are not affiliated with any college and/or universities, and there are no colleges and/or universities which endorse Edvisors’ products or services. Lender search results do not constitute an official college preferred lender list. Edvisors receives compensation from lenders that appear on this site. This compensation may impact the placement of where lenders appear on this site, for example, the order in which the lenders appear when included in a list. Not all lenders participate in our sites and lenders that do participate may not offer loans to every school.

Edvisors is not a lender and makes no representations or warranties about your eligibility for a particular loan or financial aid. Lenders are solely responsible for any and all credit decisions, loan approval and rates, terms and other costs of the loan offered and may vary based upon the lender you select. Please check with your school or lender directly for information related to your personal eligibility.

Edvisors has endeavored to provide accurate information. However, the results provided by lenders are for illustrative purposes only and accuracy is not guaranteed, as such, Edvisors assumes no responsibility for errors or omission in the information provided.

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