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Private student loan refinance during fellowship?

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  • Private student loan refinance during fellowship?

    I am a couple months away from finishing residency. Starting in August I'll be doing a 1-year sub-specialty fellowship. I currently have about $280k student loan debt in the 6.8-7.9% range from medical school (that includes principle and unpaid interest). I am interested in refinancing to try and get a lower rate since even a modest decrease will put a dent in the interest I accrue, but during fellowship I won't be making a lot of money relatively speaking. Other than student loans I only have a small amount left to pay on a car loan, my credit score is 800+, and I utilize only 0-5% of my credit card limits.

    What are the chances of even getting approved for a refinance with any of these private loan companies if I don't have a contract for a "real job" yet?

    Assuming I can get approved from one of them, if I apply with my 1-year fellowship contract saying I'll be making about $55,000 for a single year vs applying a year later when I have a contract in hand for a job making substantially more money, will that have a significant impact on the rates I get quoted from one of these lenders?

    Keep in mind that holding off for a year in hopes of an even lower rate would make me accrue about $15k more interest on my federal student loans, but without knowing what rate I'll potentially get yet and having not pinned down a repayment term strategy yet I'm not even sure if waiting a year would be beneficial in the long run. Any thoughts?

  • #2
    If you consolidate with DRB, you can pay as little as $100 month throughout your training.

    However, if you live in one of the cities that qualify, you should also check into First Republic Bank as the interest ratesĀ are super low (look for a recent WCI post about this new option).

    Hope this helps.
    Lawrence B. Keller, CFP, CLU, ChFC, RHU, LUTCF