Let’s start by saying that there is no single medical school loan refinance company that’s best for everyone. Refinance companies vary in terms of eligibility requirements, interest rates, and other terms and conditions. When refinancing medical student loans, it’s important to look for a lender who is offering you the best deal for your circumstances.

What is medical school loan refinancing?

It takes several years of study before you can qualify to practice medicine. And medical school can be expensive. By the time you’ve completed medical school, you’ll likely have accumulated several loans every year. These could add up to a few thousand dollars in federal and private student loans.

Managing so many different loans can be challenging. Many medical students choose to refinance their loans so they are easier to manage. Refinancing medical school loans involves exchanging your current loans for brand-new loans. The new loan will have a new interest rate and new terms and conditions.

There are several reasons why you may choose this option.

1. You’ll only have one loan to manage instead of several. That means keeping track of only one repayment amount and one deadline every month. This reduces the risk of missing any payment deadlines.
2. You may be paying a higher interest rate on some loans. If you qualify for a lower rate when you refinance, you could save a few thousand dollars over the loan term.
3. Refinancing your loans is the only way to increase or reduce your monthly payments, depending on your financial circumstances.
4. It’s free to refinance so you can do this multiple times to get progressively lower rates or change your loan terms if you need to.

Of course, there are a few downsides to refinancing student loans. It helps to understand the pros and cons before proceeding with this option.

Pros and Cons of Refinancing Medical School Loans

Pros:

• The potential to get lower interest rates when market rates are low, saving tens of thousands of dollars over the loan term
• The potential to get lower interest rates with a strong credit score,
• Single loan repayment makes it easier to manage
• The ability to increase monthly repayments, which reduces the loan term and saves thousands in accrued interest
• The ability to lower the monthly repayments if necessary, reducing the risk of default and consequent credit score damage
• Better chances of getting special deals from lenders
• The potential to pay off student loans faster

Cons:

• No grace period for repaying loans
• Lose eligibility for Public Student Loan Forgiveness programs
• Payments are not tied to income as in IDR programs
• Lose eligibility for Income-Dependent Repayment forgiveness
• Shorter forbearance period
• Interest rates are tied to credit scores
• You may not qualify for refinancing

When refinancing medical school loans makes sense & when it doesn’t

From the pros and cons, it’s plain to see that refinancing medical school loans may not be the right option for you.

Refinancing is a good idea if the new interest rates are lower than your current interest rates. For example, if you have high-interest private student loans, refinancing at a lower rate could save you a lot. Borrowers generally qualify for lower rates if their credit score is high or when market interest rates are down.

Refinancing also helps if you want to combine multiple loans into one loan, which simplifies monthly payments. It also lowers the likelihood of missing payment deadlines.

Regardless of other factors, you should not consider refinancing if you are pursuing federal loan forgiveness. This is because you can only refinance medical student loans with private lenders. When you refinance federal student loans, they become private loans and lose all benefits and protections associated with the original loan. That means you will no longer be eligible to apply for student loan forgiveness.

It also best not to refinance if you’re planning on working fewer hours or part time for personal reasons. Or if your household debt-to-income ratio is higher than 1.0 – 1.5 and you don’t expect it to get lower within five years. For example, this may be if you earn $1000,000 but your debt is more than $150,000.

Best Medical School Loan Refinance Companies

If you’ve decided that refinancing is the right option for you, these are the top eight medical school loan refinance companies that we recommend:

1. Laurel Road
2. SoFi
3. Earnest
4. Nelnet Bank
5. College Ave
6. Splash Financial
7. Navi Refi
8. All of these companies are highly reputable and offer some of the best rates when refinancing medical student loans.

How to refinance medical school loans

Once you’ve decided to ahead with refinancing medical school loans, the first step is to find the best lender for you.

Step 1: Start with the list above or do a general online search for ‘medical school loan refinance companies’.

Step 2 – Check each lender’s eligibility criteria. Every lender will have their own minimum credit score requirement. Shortlist those lenders whose requirements you meet.

Step 3 – Check the interest rates for each lender on your shortlist.  You want to identify lenders offering the lowest rates and also low or zero fees.

Step 4 – Request quotes from the companies that you’ve shortlisted as good matches for you. These initial applications will trigger only a soft credit check, which won’t hurt your credit. DO NOT submit an application at this stage. Only request a quote. Submitting an application will trigger a hard credit check, which will shave a few points off your credit score. Multiple applications will pull your score down by several points.

Step 5– Choose your preferred lender, select the monthly repayments and terms of your new loan, and proceed with your loan application.

RaptorFi makes it easy for you to get personalized student loan refinance rates by answering a few questions. And it’s free too!