If you are employed with a steady income, making multiple monthly payments, don’t foresee needing federal loan benefits (such as student loan forgiveness after 10 years of public service work or income-based repayment options), and have a good credit score, refinancing may be the right fit for you. Other factors to consider are your debt-to-income ratio, whether you are up to date on your payments, and if you know a good lender.
When you refinance your student loans, you are making fewer payments, which is easier to keep track of. With less money going toward your student loans, you’ll have more cash for other expenses or for savings. And while we’re talking savings, you’ll save money in interest by paying off your loans faster, not to mention locking in a lower rate (or switching to a variable rate, if that meets your current needs). Lastly, a lower monthly payment decreases your debt-to-income ratio, which can make it easier to qualify for a mortgage and other important credit needs.