Fixed-rate student loan refinancing rates hit record low
Written by
Writer
Ashley Harrison has over six years of experience as an authority on personal finance. Her work has been featured by USA TODAY Blueprint, Forbes Advisor, Fox Business, and Yahoo Money.
Updated October 16, 2024, 2:41 AM EDT
- Rates on 10-year fixed-rate loans averaged 3.72%, down from 3.78% the week before and 4.76% a year ago. The previous record low for 10-year fixed rate loans was 3.78%, last seen during the week of Feb. 8, 2021.
- Rates on 5-year variable-rate loans averaged 3.23%, down from 3.24% the week before and 3.73% a year ago. Variable-rate loans recorded a record low of 2.63% during the week of June 29, 2020.
Student loan refinancing weekly rate trends
Current student loan refinancing rates by FICO score
To provide relief from the economic impacts of the COVID-19 pandemic, interest and payments on federal student loans have been suspended through at least Sept. 30, 2021. As long as that relief is in place, there’s little incentive to refinance federal student loans. But many borrowers with private student loans are taking advantage of the low interest rate environment to refinance their education debt at lower rates.
If you qualify to refinance your student loans, the interest rate you may be offered can depend on factors like your FICO score, the type of loan you’re seeking (fixed or variable rate), and the loan repayment term.
The chart above shows that good credit can help you get a lower rate, and that rates tend to be higher on loans with fixed interest rates and longer repayment terms. Because each lender has its own method of evaluating borrowers, it’s a good idea to request rates from multiple lenders so you can compare your options. A student loan refinancing calculator can help you estimate how much you might save.
If you want to refinance with bad credit, you may need to apply with a cosigner. Or, you can work on improving your credit before applying. Many lenders will allow children to refinance parent PLUS loans in their own name after graduation.
How rates for student loan refinancing are determined
The rates private lenders charge to refinance student loans depend in part on the economy and interest rate environment, but also the loan term, the type of loan (fixed- or variable-rate), the borrower's credit worthiness, and the lender's operating costs and profit margin.
About Credible