What is the average student loan refinance rate?

Rates range from 4.5-7% for excellent credit to 8-12% for fair credit in 2026. Variable rates start lower (4-6%) but can increase. Fixed rates are 5-8% for well-qualified borrowers.

Should I refinance my student loans?

Refinance if you have private loans or federal loans you don't want forgiveness on, and you can get a lower rate. Don't refinance federal loans if you're pursuing PSLF or need income-driven repayment—refinancing converts them to private and you lose those protections.

Does refinancing student loans hurt your credit?

Applying causes a hard inquiry (-5 to -10 points temporarily), but having a lower rate and making payments improves your score over time. Many lenders offer pre-qualification with a soft pull first.

Student Loan Refinancing: Rates, Savings, and When It Makes Sense (2026)

Refinancing replaces your current student loans with a new private loan at a (hopefully) lower rate. It can save thousands—but only if you qualify for a better rate and don’t need federal loan protections.

Current Student Loan Refinancing Rates (2026)

Credit Score	Fixed Rate	Variable Rate
780+ (Excellent)	4.9-6.2%	4.5-5.8%
720-779 (Very Good)	5.5-7.0%	5.0-6.5%
670-719 (Good)	6.5-8.5%	6.0-8.0%
580-669 (Fair)	8.5-12.0%	8.0-11.0%

Compare to current federal loan rates: 5.50% (undergraduate), 7.05% (graduate), 8.05% (PLUS).

How Much Can You Save by Refinancing?

Example: $50,000 in Loans at 7% Over 10 Years

Scenario	Rate	Monthly Payment	Total Interest	Total Paid	Savings
Current (7%, 10 years)	7.0%	$581	$19,668	$69,668	—
Refi to 5% (10 years)	5.0%	$530	$13,639	$63,639	$6,029
Refi to 5% (7 years)	5.0%	$707	$9,363	$59,363	$10,305
Refi to 4.5% (5 years)	4.5%	$931	$5,842	$55,842	$13,826

Example: $100,000 in Loans (Law/Medical School)

Scenario	Rate	Monthly Payment	Total Interest	Savings
Current (7%, 10 years)	7.0%	$1,161	$39,336	—
Refi to 5% (10 years)	5.0%	$1,061	$27,278	$12,058
Refi to 5% (7 years)	5.0%	$1,414	$18,726	$20,610

When to Refinance Student Loans

Good Candidates

Scenario	Why Refinance Makes Sense
Private loans at high rates	No federal protections to lose; lower rate saves money
Federal loans you’ll pay off in full	You won’t use IDR or PSLF; lower rate = pure savings
High income, strong credit (720+)	You qualify for the best rates
Large balance ($50K+)	Even a small rate reduction saves thousands
Multiple loans	Simplify to one payment

Bad Candidates (Don’t Refinance)

Scenario	Why Not
Pursuing PSLF	Refinancing makes federal loans private—you lose PSLF eligibility
Need income-driven repayment	Private loans have no IDR options
Might need forbearance/deferment	Federal protections are more generous
Credit score below 670	Rate offered may not be lower than current rate
Close to forgiveness	Don’t restart the clock
Unstable income	Federal protections are your safety net

What Lenders Look At

Factor	What They Want
Credit score	670+ (some require 680-700+)
Income	Stable, sufficient to cover payments
Debt-to-income ratio	Below 50% (ideally below 40%)
Employment	Employed or have a signed offer letter
Degree	Completed degree (some lenders require this)
Cosigner	Can help if you don’t qualify alone

Fixed vs. Variable Rate

Feature	Fixed Rate	Variable Rate
Rate stays the same	Yes—for entire loan term	No—changes with market
Starting rate	Higher	Lower
Best for	Long loan terms (7-20 years)	Short terms (3-5 years)
Risk	None	Rate could increase significantly
Predictability	Monthly payment never changes	Payment can increase

Rule of thumb: Choose fixed if your term is 7+ years. Consider variable only if you’ll pay off within 5 years.

The Bottom Line

Refinancing makes sense when you can get a rate at least 1% lower than your current rate and you don’t need federal loan protections like PSLF or IDR. On $50,000 in loans, a 2% rate reduction saves $6,000-$14,000 depending on the term. Always compare at least 3-5 lenders and check your prequalified rate (soft pull) before applying.