Student loan payments: get advice and actual numbers here

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CknNgtz
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Re: Student loan payments: get advice and actual numbers here

Postby CknNgtz » Wed Sep 20, 2017 12:52 pm

SmokeytheBear wrote:
CknNgtz wrote:Another FR refinancing question for a new biglaw associate - is the 2 years work experience a hard requirement? It seems FR allows a little flexibility with the liquidity requirement and I was wondering if they'd be similarly flexible with the 2 years WE.

Alternatively, I've seen people say that externships, clinics, summer associateships, etc. can count towards the 2 years in the industry. Is this true?


Not hard. A guy in my group refied with them at the end of his stub year.


Might be a long shot but do you know if he was K-JD? Thanks for the reply

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Danger Zone
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Re: Student loan payments: get advice and actual numbers here

Postby Danger Zone » Wed Sep 20, 2017 12:55 pm

Considering all of this is just a proxy for the central question of whether you can repay the loan, having parents that can lend you five figures on a moments notice seems like it should count in your favor.

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bk1
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Re: Student loan payments: get advice and actual numbers here

Postby bk1 » Wed Sep 20, 2017 1:00 pm

Danger Zone wrote:Considering all of this is just a proxy for the central question of whether you can repay the loan, having parents that can lend you five figures on a moments notice seems like it should count in your favor.

Arguably, yes, but that is also true for a host of other things that banks routinely do not factor in.

Plus there is an easy way to get your parents as a factor into your application: have them cosign.

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SmokeytheBear
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Re: Student loan payments: get advice and actual numbers here

Postby SmokeytheBear » Wed Sep 20, 2017 1:10 pm

CknNgtz wrote:
SmokeytheBear wrote:
CknNgtz wrote:Another FR refinancing question for a new biglaw associate - is the 2 years work experience a hard requirement? It seems FR allows a little flexibility with the liquidity requirement and I was wondering if they'd be similarly flexible with the 2 years WE.

Alternatively, I've seen people say that externships, clinics, summer associateships, etc. can count towards the 2 years in the industry. Is this true?


Not hard. A guy in my group refied with them at the end of his stub year.


Might be a long shot but do you know if he was K-JD? Thanks for the reply


Nah he had two years between.

anon3030
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Re: Student loan payments: get advice and actual numbers here

Postby anon3030 » Wed Sep 20, 2017 1:24 pm

I appreciate all the discussion on refinancing; it is very helpful. I am considering refinancing in early 2018 as I can use the interest payment tax deduction for 2017 (stub year = less than $80k), and I want to make sure I feel comfortable with my job before giving up my student loan protection.

On a slightly different note, I am considering making a student loan payment early, before payments become required this December. I have the option to apply the payment as a refund of loan principal or as a payment against interest. What do people think is better? No matter what, I I will try to pay at least $2,500 in interest in 2017 to take advantage of the tax deduction.

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Danger Zone
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Re: Student loan payments: get advice and actual numbers here

Postby Danger Zone » Wed Sep 20, 2017 1:34 pm

anon3030 wrote:I appreciate all the discussion on refinancing; it is very helpful. I am considering refinancing in early 2018 as I can use the interest payment tax deduction for 2017 (stub year = less than $80k), and I want to make sure I feel comfortable with my job before giving up my student loan protection.

On a slightly different note, I am considering making a student loan payment early, before payments become required this December. I have the option to apply the payment as a refund of loan principal or as a payment against interest. What do people think is better? No matter what, I I will try to pay at least $2,500 in interest in 2017 to take advantage of the tax deduction.

Principal is the obvious answer here since student loans bear simple (not compounding) interest

Necho2
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Re: Student loan payments: get advice and actual numbers here

Postby Necho2 » Wed Sep 20, 2017 2:02 pm

Hold on so while we're talking about interest, my plan with the Stafford ones I have at about ~5.7% across 2 years (30k), is to let the interest accumulate until next fall, then use some SA money to pay it off, take the deduction while I'm in the 25% bracket (which I'm almost positive I will be in), and then do the same the year after when I start working full-time but am under the income cap for interest deduction.

So for the first 3 years of loan existence, I'll effectively have had a 4.2% rate of interest, and be able to stick my head up as a real 1st year associate w/ 30k in loans and figure out whether I want to immediately refi or keep the 5.7% interest rate and fed protections. Anything wrongheaded about that? I have pretty substantial investments, and could probably liquidate them to avoid having to take out this year's loans and next, or alternatively I could also take out another 15k in 2018-2019, but I think the rate is projected to hit 6.7% or something and that just seems a bit high...

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beepboopbeep
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Re: Student loan payments: get advice and actual numbers here

Postby beepboopbeep » Thu Sep 21, 2017 3:52 am

If you only have 30k and are starting biglaw there are basically no bad options, loanwise. Maybe you'll save like $2k on interest payments doing things one way or another.

That said, something that surprised me after the summer of bar study was how not-far the firm advance went (especially after ~35-40% gets eaten by taxes) especially if moving across the country or otherwise moving into a new place. So if your investment savings is mostly not very liquid, and it sounds like it's not, I'd probably recommend saving your SA money for the summer of bar study if the alternative is going to be credit cards. Interest on 30k is not going to be substantial anyway.

I'd definitely refi anyway, take the lowest term/rate you can find, and pound it out. You can probably do it in a year depending on your other expenses and how much you want to allocate to savings vs loan payoff.

Necho2
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Re: Student loan payments: get advice and actual numbers here

Postby Necho2 » Thu Sep 21, 2017 12:29 pm

beepboopbeep wrote:If you only have 30k and are starting biglaw there are basically no bad options, loanwise. Maybe you'll save like $2k on interest payments doing things one way or another.

That said, something that surprised me after the summer of bar study was how not-far the firm advance went (especially after ~35-40% gets eaten by taxes) especially if moving across the country or otherwise moving into a new place. So if your investment savings is mostly not very liquid, and it sounds like it's not, I'd probably recommend saving your SA money for the summer of bar study if the alternative is going to be credit cards. Interest on 30k is not going to be substantial anyway.

I'd definitely refi anyway, take the lowest term/rate you can find, and pound it out. You can probably do it in a year depending on your other expenses and how much you want to allocate to savings vs loan payoff.


Eh it's perfectly liquid (or as liquid as a brokerage account can be), but my hunch with an effective interest rate of 4.2% has been to leave it in the market and gamble on greater returns. Plan for SA money was going to be to eliminate need to take any loans 3L, and I suppose there'll be a hunk left over that could probably also supplement the summer advance. Sounds like at 30k a refi once I can get a sufficiently low number (is 30k not enough for FRB to be interested?) makes sense given the debt burden is so low overall, and I think I'd prefer to save at the same time if I can get a private loan at that same 4% interest or so.

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boredtodeath
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Re: Student loan payments: get advice and actual numbers here

Postby boredtodeath » Thu Sep 21, 2017 12:46 pm

So I refi'd with FR back in March on the 4.1% 15 yr loan and I noticed that they have basically cut their interest rates in half. Would they refi their own loan down to the new interest rate for me (I don't see why they would)? Or would I have to get another refi offer with another bank in order to get them to do it?

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Mr. Peanutbutter
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Re: Student loan payments: get advice and actual numbers here

Postby Mr. Peanutbutter » Thu Sep 21, 2017 1:00 pm

boredtodeath wrote:So I refi'd with FR back in March on the 4.1% 15 yr loan and I noticed that they have basically cut their interest rates in half. Would they refi their own loan down to the new interest rate for me (I don't see why they would)? Or would I have to get another refi offer with another bank in order to get them to do it?

They would, especially if you’re creditworthy enough to refi elsewhere.

kykiske
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Re: Student loan payments: get advice and actual numbers here

Postby kykiske » Fri Sep 22, 2017 9:01 am

Does anyone have any good tips on how to "penny-pinch"? I'm hoping to increase the amount of money I put towards loans per month. I'm currently paying $1,500/month, and if I continue at this pace, I will pay off all my loans in 7 years. That's not too terrible, as I will only be in my mid 30s at that point.

But I'd like to pay them off faster, if at all possible. I'd like to cut back on needless spending, which I am fully aware I do. Starting about 8 months ago, I stopped going out for lunch every day (cut it down to once a week, if at all). That has had a significant impact. I also stopped drinking espresso drinks everyday (again, significant impact).

My sister (financial advisor) recommended that I delete my saved payment method off Amazon, as I believe that is the main culprit of my needless spending. To be blunt, I probably drop $400/month buying dumb stuff off Amazon. Feel free to chastise me there, as I probably deserve it. As of this morning, however, I no longer have any saved payment method.

There are few things I'd still like to spend money on (dates with SO, happy hour, events with friends). I can cut back on those things, but I do not want to excise them completely.

Are there any other things I could do? Ideally, it'd be something that quickly becomes a habit, and would save me money and somehow go unnoticed that I am doing (if that makes sense). As in, I'd be penny-pinching without realizing that I'm penny-pinching.

My sister also recommended that I treat every paycheck as 20% less than it actually is. As in, I budget as if I could live off my paychecks being 20% less, which in turn, produces more money. That money then can get pumped into student loans. But, I'm not sure if this will work for me.

Any candid advice is welcomed :)

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Danger Zone
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Re: Student loan payments: get advice and actual numbers here

Postby Danger Zone » Fri Sep 22, 2017 9:38 am

kykiske wrote:Does anyone have any good tips on how to "penny-pinch"? I'm hoping to increase the amount of money I put towards loans per month. I'm currently paying $1,500/month, and if I continue at this pace, I will pay off all my loans in 7 years. That's not too terrible, as I will only be in my mid 30s at that point.

But I'd like to pay them off faster, if at all possible. I'd like to cut back on needless spending, which I am fully aware I do. Starting about 8 months ago, I stopped going out for lunch every day (cut it down to once a week, if at all). That has had a significant impact. I also stopped drinking espresso drinks everyday (again, significant impact).

My sister (financial advisor) recommended that I delete my saved payment method off Amazon, as I believe that is the main culprit of my needless spending. To be blunt, I probably drop $400/month buying dumb stuff off Amazon. Feel free to chastise me there, as I probably deserve it. As of this morning, however, I no longer have any saved payment method.

There are few things I'd still like to spend money on (dates with SO, happy hour, events with friends). I can cut back on those things, but I do not want to excise them completely.

Are there any other things I could do? Ideally, it'd be something that quickly becomes a habit, and would save me money and somehow go unnoticed that I am doing (if that makes sense). As in, I'd be penny-pinching without realizing that I'm penny-pinching.

My sister also recommended that I treat every paycheck as 20% less than it actually is. As in, I budget as if I could live off my paychecks being 20% less, which in turn, produces more money. That money then can get pumped into student loans. But, I'm not sure if this will work for me.

Any candid advice is welcomed :)

Go to a place like ally bank where you can easily open multiple bank accounts and name them for each thing you're using the dollars for. Give every dollar a purpose. For example, put 20% of your paycheck into an account as soon as you receive the paycheck and then only use that money for repaying student loans or savings.

kykiske
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Re: Student loan payments: get advice and actual numbers here

Postby kykiske » Fri Sep 22, 2017 9:47 am

Danger Zone wrote:
kykiske wrote:Does anyone have any good tips on how to "penny-pinch"? I'm hoping to increase the amount of money I put towards loans per month. I'm currently paying $1,500/month, and if I continue at this pace, I will pay off all my loans in 7 years. That's not too terrible, as I will only be in my mid 30s at that point.

But I'd like to pay them off faster, if at all possible. I'd like to cut back on needless spending, which I am fully aware I do. Starting about 8 months ago, I stopped going out for lunch every day (cut it down to once a week, if at all). That has had a significant impact. I also stopped drinking espresso drinks everyday (again, significant impact).

My sister (financial advisor) recommended that I delete my saved payment method off Amazon, as I believe that is the main culprit of my needless spending. To be blunt, I probably drop $400/month buying dumb stuff off Amazon. Feel free to chastise me there, as I probably deserve it. As of this morning, however, I no longer have any saved payment method.

There are few things I'd still like to spend money on (dates with SO, happy hour, events with friends). I can cut back on those things, but I do not want to excise them completely.

Are there any other things I could do? Ideally, it'd be something that quickly becomes a habit, and would save me money and somehow go unnoticed that I am doing (if that makes sense). As in, I'd be penny-pinching without realizing that I'm penny-pinching.

My sister also recommended that I treat every paycheck as 20% less than it actually is. As in, I budget as if I could live off my paychecks being 20% less, which in turn, produces more money. That money then can get pumped into student loans. But, I'm not sure if this will work for me.

Any candid advice is welcomed :)

Go to a place like ally bank where you can easily open multiple bank accounts and name them for each thing you're using the dollars for. Give every dollar a purpose. For example, put 20% of your paycheck into an account as soon as you receive the paycheck and then only use that money for repaying student loans or savings.


Two Qs. First, I bank with Wells Fargo. Can I implement this strategy with Wells Fargo? Second, does opening multiple bank accounts hurt my overall credit?

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Danger Zone
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Re: Student loan payments: get advice and actual numbers here

Postby Danger Zone » Fri Sep 22, 2017 10:31 am

I don't bank with Wells Fargo so no idea, but opening bank accounts does not affect your credit at all. The only accounts that affect your credit are things that are extending you credit, like credit cards, personal loans, car loans, mortgages, etc.

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Re: Student loan payments: get advice and actual numbers here

Postby Anonymous User » Fri Sep 22, 2017 10:37 am

kykiske wrote:Does anyone have any good tips on how to "penny-pinch"? I'm hoping to increase the amount of money I put towards loans per month. I'm currently paying $1,500/month, and if I continue at this pace, I will pay off all my loans in 7 years. That's not too terrible, as I will only be in my mid 30s at that point.

But I'd like to pay them off faster, if at all possible. I'd like to cut back on needless spending, which I am fully aware I do. Starting about 8 months ago, I stopped going out for lunch every day (cut it down to once a week, if at all). That has had a significant impact. I also stopped drinking espresso drinks everyday (again, significant impact).

My sister (financial advisor) recommended that I delete my saved payment method off Amazon, as I believe that is the main culprit of my needless spending. To be blunt, I probably drop $400/month buying dumb stuff off Amazon. Feel free to chastise me there, as I probably deserve it. As of this morning, however, I no longer have any saved payment method.

There are few things I'd still like to spend money on (dates with SO, happy hour, events with friends). I can cut back on those things, but I do not want to excise them completely.

Are there any other things I could do? Ideally, it'd be something that quickly becomes a habit, and would save me money and somehow go unnoticed that I am doing (if that makes sense). As in, I'd be penny-pinching without realizing that I'm penny-pinching.

My sister also recommended that I treat every paycheck as 20% less than it actually is. As in, I budget as if I could live off my paychecks being 20% less, which in turn, produces more money. That money then can get pumped into student loans. But, I'm not sure if this will work for me.

Any candid advice is welcomed :)


I've always found tracking my spending in a budget to be really helpful. When I create the budget, I usually work pretty hard to give myself more in many of the categories than I think I'll want (so that it doesn't feel super draconian: a budget that is impossible to stick to is a budget you'll start ignoring quickly). I've generally found that the reason why I overspend is that my spending often doesn't track my priorities. I'll buy an extra drink when out to dinner not because I really want one, but because I'm there. When you have a fixed amount of money to spend on restaurants--or on drinking--it forces you to think harder about what expenditures you want to prioritize. Sometimes, I do want a glass of wine with dinner or that extra $11 cocktail. But more times than not, when I'm actually forced to stop and think about it in the way that a budget--even a generous budget--requires you to, I realize that that's not how I want to spend my money. Every time I've tried to budget like this, I've found that I usually (a) save a ton of money, and (b) actually feel like I have more money to spend on the things that I care about.

It sounds like you're starting to do some of these things already. If you come up with a budget, that will give you a chance to sit down and think about how much you value eating out vs preparing your own lunch; how much you enjoy those daily espressos; whether you'd like to give yourself some amazon play money; etc. It may be that you decide you want to spend $0 in each of these categories. Or, it might be the case that you'd like to have some small weekly or bi-weekly allowances that you can dedicate to these sorts of fun discretionary expenses. (From personal experience, I think that a two-week budget hits the sweet spot of forcing you to be accountable on a daily basis while giving you some flex for expenses like groceries and dates that will vary some week-by-week.)

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JenDarby
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Re: Student loan payments: get advice and actual numbers here

Postby JenDarby » Fri Sep 22, 2017 10:48 am

Danger Zone wrote:I don't bank with Wells Fargo so no idea, but opening bank accounts does not affect your credit at all. The only accounts that affect your credit are things that are extending you credit, like credit cards, personal loans, car loans, mortgages, etc.

with the caveat that many to most banks only do soft pulls to open a savings account but there ARE banks that do a hard pull to open a savings account. to the extent you have a lot of hard pulls on your credit report it can have a smal impact on your credit score. I won't vouch to the accuracy, but here's a list of banks/CUs that do soft versus hard pulls

http://www.hustlermoneyblog.com/bank-ac ... hard-pull/

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Danger Zone
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Re: Student loan payments: get advice and actual numbers here

Postby Danger Zone » Fri Sep 22, 2017 11:53 am

Whoa, I had no idea any bank did a hard pull for a savings account. That's absurd.

cgw
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Re: Student loan payments: get advice and actual numbers here

Postby cgw » Fri Sep 22, 2017 7:16 pm

boredtodeath wrote:So I refi'd with FR back in March on the 4.1% 15 yr loan and I noticed that they have basically cut their interest rates in half. Would they refi their own loan down to the new interest rate for me (I don't see why they would)? Or would I have to get another refi offer with another bank in order to get them to do it?


FR doesn't refi again but they do let you modify. I refi'd with them in March also and I'm modifying to a 2.95% 15 yr loan. You have to apply/qualify again and there's a $250 fee. The new loan also won't restart your term, the term is less the number of payments you've made. I just sent them an email asking to modify and they sent me an app right away. No negotiation required.

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Re: Student loan payments: get advice and actual numbers here

Postby Anonymous User » Mon Sep 25, 2017 4:07 pm

cgw wrote:
boredtodeath wrote:So I refi'd with FR back in March on the 4.1% 15 yr loan and I noticed that they have basically cut their interest rates in half. Would they refi their own loan down to the new interest rate for me (I don't see why they would)? Or would I have to get another refi offer with another bank in order to get them to do it?


FR doesn't refi again but they do let you modify. I refi'd with them in March also and I'm modifying to a 2.95% 15 yr loan. You have to apply/qualify again and there's a $250 fee. The new loan also won't restart your term, the term is less the number of payments you've made. I just sent them an email asking to modify and they sent me an app right away. No negotiation required.


Yup, spoke to my banker there this morning and received the same info. They will modify to allow you to change term and/or add more loans to the refi. They will also modify just the interest rate if you refer two people who actually apply with them for a loan/bank account. Have to re-apply but assuming you qualified the first time and didn't spend all your liquid assets, can't see why you wouldn't be approved again.

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boredtodeath
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Re: Student loan payments: get advice and actual numbers here

Postby boredtodeath » Mon Sep 25, 2017 4:10 pm

Accidental anon^

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bk1
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Re: Student loan payments: get advice and actual numbers here

Postby bk1 » Mon Sep 25, 2017 5:01 pm

boredtodeath wrote:
cgw wrote:
boredtodeath wrote:So I refi'd with FR back in March on the 4.1% 15 yr loan and I noticed that they have basically cut their interest rates in half. Would they refi their own loan down to the new interest rate for me (I don't see why they would)? Or would I have to get another refi offer with another bank in order to get them to do it?


FR doesn't refi again but they do let you modify. I refi'd with them in March also and I'm modifying to a 2.95% 15 yr loan. You have to apply/qualify again and there's a $250 fee. The new loan also won't restart your term, the term is less the number of payments you've made. I just sent them an email asking to modify and they sent me an app right away. No negotiation required.


Yup, spoke to my banker there this morning and received the same info. They will modify to allow you to change term and/or add more loans to the refi. They will also modify just the interest rate if you refer two people who actually apply with them for a loan/bank account. Have to re-apply but assuming you qualified the first time and didn't spend all your liquid assets, can't see why you wouldn't be approved again.

I was also told you can modify the rate if you have liquidity equal to at least 30% of the balance (which... lol for most people) if you don't get the 2 referrals.

And, to the extent you change the term, the new term dates back to your initial FR loan (so if you're 1 year into a 5 year FR loan and you switch to a 15 year loan, it will have 14 years left).

uvheylaw
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Re: Student loan payments: get advice and actual numbers here

Postby uvheylaw » Tue Sep 26, 2017 7:31 am

If you are not in First Republic's service area, does SoFi generally have the next lowest rates? All I can get are estimates without a hard credit pull obviously.

In the same vein, can someone PM me a sofi referal link?

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JenDarby
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Re: Student loan payments: get advice and actual numbers here

Postby JenDarby » Tue Sep 26, 2017 8:52 am

uvheylaw wrote:If you are not in First Republic's service area, does SoFi generally have the next lowest rates? All I can get are estimates without a hard credit pull obviously.

In the same vein, can someone PM me a sofi referal link?

When I first refinanced I found that commonbond had the best rates for me outside of FRB. Earnest also has excellent rates

rate shopping is generally not counted against you for credit score purposes so if you have multiple hard pulls in a short period for the same type of loan a lot of models will count them as just one.

Also most credit models only account your hard inquiries within the last 2 years, so unless you're buying a house in the next 2 years... But even if you are, I rate shopped for student loan refi, financed a car, and bought a house all in under 2 years with no negative impact to my credit score or the process.

Personally, I think the benefits of getting a great rate outweigh the short term credit hit of rate shopping, but obviously that's for you to decide. You can try one and if you're disappointed in the rate then I would recommend applying to at least a second.

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Re: Student loan payments: get advice and actual numbers here

Postby Anonymous User » Tue Sep 26, 2017 5:14 pm

bk1 wrote:
boredtodeath wrote:
cgw wrote:
boredtodeath wrote:So I refi'd with FR back in March on the 4.1% 15 yr loan and I noticed that they have basically cut their interest rates in half. Would they refi their own loan down to the new interest rate for me (I don't see why they would)? Or would I have to get another refi offer with another bank in order to get them to do it?


FR doesn't refi again but they do let you modify. I refi'd with them in March also and I'm modifying to a 2.95% 15 yr loan. You have to apply/qualify again and there's a $250 fee. The new loan also won't restart your term, the term is less the number of payments you've made. I just sent them an email asking to modify and they sent me an app right away. No negotiation required.


Yup, spoke to my banker there this morning and received the same info. They will modify to allow you to change term and/or add more loans to the refi. They will also modify just the interest rate if you refer two people who actually apply with them for a loan/bank account. Have to re-apply but assuming you qualified the first time and didn't spend all your liquid assets, can't see why you wouldn't be approved again.

I was also told you can modify the rate if you have liquidity equal to at least 30% of the balance (which... lol for most people) if you don't get the 2 referrals.

And, to the extent you change the term, the new term dates back to your initial FR loan (so if you're 1 year into a 5 year FR loan and you switch to a 15 year loan, it will have 14 years left).

Just got off the phone with my banker for a modification and there was no mention of 30% or referrals. He said it was just the same process as the initial qualification...




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