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Pay down before refinancing?

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  • Pay down before refinancing?


    My partner is an ED attending in her 2nd year out of residency. She has about $375,000 in federal student loans and we are looking to refinance in the upcoming months now that the federal interest freeze is set to expire.

    Question 1) Should we pay a chunk before refinancing? Perhaps 50k or so that we have saved during the interest freeze to potentially get a better interest rate and pay down the principle? Is this worth it or just refinance as is?

    Question 2) Now that we have explored options and decided that private refinancing is the best option, is there any point to paying a consultant for student loan advice or just use the WCI links and apply to various refinancing companies? We have applied in the past and ended up waiting since the interest freeze had been extended. Her income is all 1099 and as a new attending the loan services made the applications a bit of a pain and the interest rates were worse than expected.


  • #2
    1.) I'd probably pay down a chunk of the loans before you private refi, assuming you have an emergency fund beyond the 50k you indicated in your post. This would give you a lower required monthly payment.

    2.) If your partner is the only one in your household with student loans, I'd just private refinance. If you have loans or there is a possibility of loan forgiveness for either of you, or you need help navigating the private refinance process then it might make sense for you to meet with
    Helping student loan borrowers manage their student loans. [email protected]