Most student loan borrowers understand that they can save a ton money by refinancing their student debt. And this website has detailed at length all of the benefits one can realize from refinancing their student loans. Indeed, as already explained, you can minimize the amount of interest you pay over the life of your debt and lower your monthly student loan payments after going through the student loan refinancing process.
However, many student debt borrowers still do not take the time to refinance their student loans. In order to refinance student loans, student debt borrowers need to conduct research and select the best refinancing partner. In addition, the process of refinancing student loans requires a borrower to fill out forms, submit a variety of documents, and complete other steps. Many people do not want to go through the hassle of refinancing their student loans despite the benefits that they could realize after refinancing.
However, the student debt refinancing process is extremely easy. In addition, there are certain things you can do to make the process of refinancing your student loans even more painless. As previously mentioned, I did not refinance my student loans during my student debt repayment saga. However, one of my brothers (not the one I convinced to write guest articles!) is in the process of refinancing his student loans. My brother’s experience reveals several steps one can take to make the student loan refinancing process more painless.
The first thing that you could do to prepare for the refinancing process is to fix any errors that might exist on your credit report. As articles on this website have already explained, it is possible for negative information to be listed on someone’s credit report even though they did nothing wrong. Your credit score is extremely important to the student loan refinancing process, since refinancing companies will determine which interest rate to offer you based on your current credit score.
Under federal law, you are entitled to a copy of your credit report from all of the credit bureaus once a year. In addition, most credit card companies provide you with your credit score, and some will also supply more detailed information about your credit history. In any event, be sure to review all of your credit information before refinancing, and if there is a discrepancy, definitely contest any issue. Improving your credit score by even a small amount could make a huge difference on the interest rate you are offered by refinancing companies.
Another thing that you can do to make refinancing easier is to collect all of the documents you will need to refinance your student loans before you start the refinancing process. The belief that massive amounts of documents are needed to refinance student loans is one of the reasons why numerous people do not go through with the refinancing process. Many people think that refinancing requires the same amount of documents as obtaining a mortgage, and that it will take a long time to assemble all of the materials needed to complete the refinancing process.
In reality, you only need to submit several documents to refinance your student debt. First, you will usually need to submit the last statement for all of your student loans. As previously mentioned, individuals typically have multiple student loans and a number of different student loan servicers, but it is still very easy to obtain your student loan statements. Usually, this will just require you to log into each website where you pay your student loans and download your most recent statement, a process that should take under an hour.
In addition, most refinancing companies require you to submit a pay stub or two from your employer. This makes sense, since student loan refinancing companies want to ensure that you are employed and earn the income necessary to pay off your refinanced student loans. For individuals who still work at employers who issue paper pay stubs, just be sure you don’t throw away your pay stubs for a while. For those of us who receive electronic pay stubs, all you’ll need to do is download your most recent pay stubs from your online account, and use these during the refinancing process.
It can be difficult to prove that you have income from a part-time job, especially if you are working multiple side-hustles like I did during my student debt repayment journey. However, if you have 1099s from these gigs, this should suffice if you want to show that you are earning this income. In addition, if you just started a job, and don’t yet have pay stubs, you can usually just submit your offer letter to prove your income and employment status.
The only other documents you may need to submit during the refinancing process are materials that prove your identity. However, it is simple enough to scan your driver’s license or social security card to fulfill this requirement. Unlike the mortgage process, most refinancing companies don’t care how much savings you have, so you won’t need to upload bank statements when refinancing your student debt.
Probably the best thing you can do to prepare for the student loan refinancing process is to conduct research on refinancing partners. This is perhaps the most time-consuming part of the refinancing process, so you should definitely start researching refinancing companies as soon as possible. Student Debt Diaries recommends that everyone consider Splash Financial, a top refinancing company. In addition, if you use the link above to refinance your student loans through Splash, you may receive a generous welcome incentive and Student Debt Diaries may receive a bonus as well. Of course, you should look into multiple refinancing partners, but Splash should definitely be part of your search.
In the end, the student loan refinancing process is not as difficult as you might think. And if you perform a few tasks, you will be fully prepared to complete the process of refinancing your student loans.