Deciding to refinance your student loans is a big decision, and one that shouldn’t be made lightly. A lot of factors go into it, most important of which is what lender you’ll refinance with. One great option worth checking out is CommonBond student loans.
Before you start to look into their interest rates and other terms, you should first make sure that you meet their eligibility criteria.
Here’s a snapshot of the basic eligibility requirements for refinancing with CommonBond.
- You must be a US citizen or a permanent resident with the proper documentation.
- Have earned at least a bachelor’s degree.
- You must have a degree from an eligible school. CommonBond works with many colleges and universities, but not all.
- Are a resident of any state other than Nevada, Idaho, Vermont, or Mississippi. Residents of these states are not eligible.
- You must have a minimum credit score of 660 to be approved for refinancing without a cosigner.
In addition to these requirements, CommonBond will also consider your employment status, income, debt-to-income ratio, and cash flow to determine your eligibility and borrowing power. If you are approved, your earning and income details are then used to set a customized rate of interest.
You have three rate choices when refinancing through CommonBond—fixed, variable, and hybrid. While fixed and variable rates are common with other lenders, not many offer hybrid interest rates.
Hybrid rates give you the benefits of both fixed rates and variable rates. With this option, you pay a fixed rate for the first 5 years, and then switch over to a variable rate for the next 5 years. This gives you the stability of fixed rates during the first 5 years of your loan term, with the potential to save more during the next 5.
Keep in mind that with hybrid rates, you have to pay off your loan within 10 years.
Fees, Discounts, and Penalties
CommonBond does not charge borrowers any application or origination fees. This is unlike many other lenders that charge various processing fees, which increase the overall cost of your loan.
Additionally, you may qualify for a 0.25% discount on the quoted interest rates if you sign up for auto-payments.
CommonBond also allows you to pay off your debt earlier than the agreed-upon term without charging you any pre-payment penalties. Choosing to pay off your loans early can save you a lot of money in accruing interest. Many lenders will penalize you for early payments. CommonBond won’t.
However, CommonBond does impose a $10 late fee if you are more than 10 days late on your payment. So don’t be late! (Another reason to sign up for autopay.)
Loan Application Process
Refinancing student loans through CommonBond is quick and easy. The entire process is completed online. It will only take a few minutes to complete the application, and you will get estimated rates within minutes after submitting.
As part of the application, you will need to provide these details:
- Your full name
- Date of birth
- Contact details – email address, mailing address, and phone number
- Social Security number
- College name
- Date of graduation
- Type of degree
- Estimated loan balance
- Monthly income
- Housing status
After you submit this information, CommonBond will give you an estimated rate after doing a soft check on your credit. This does not impact your credit history. A hard credit check is only done when you agree to the terms.
During the finalization process, you will be asked to sign a promissory note and submit a few documents, including your income stubs and loan statements.
CommonBond offers forbearance if you are going through a financial crisis and find it difficult to make your monthly payments. Forbearance allows you to stop your payments temporarily. While your interest will continue to add up during the forbearance period, it is far better than late payments or student loan default.
Pros & Cons of Refinancing with CommonBond
- No-hidden fees worked into the loan – CommonBond doesn’t charge application or origination fees.
- Competitive refinancing rates – The refinancing rates you get through CommonBond are some of the lowest in the industry.
- You get 3 rate choices – Very few other lenders offer you the option of choosing from fixed, variable, and hybrid rates.
- Autopay discount – You may be eligible for a 0.25% reduction on the interest rate quoted if you make your monthly payments through autopay.
- Can refinance with a cosigner – If you do not meet the qualifying requirements on your own, you can refinance with a creditworthy cosigner.
- No prepayment penalty – CommonBond won’t charge you for paying off your loan early.
- Forbearance option – CommonBond allows you to postpone your payments if you are temporarily unemployed or facing some other financial hardship.
- Can refinance Parent PLUS loans – This is something very few other lenders are willing to do.
- Ineligibility for residents of some states – If you are a resident of Nevada, Idaho, Vermont, or Mississippi you are not eligible to refinance through CommonBond.
- You must have a degree – Only students who have completed their degree program can apply to CommonBond to refinance.
- Ineligibility for graduates from certain programs – To qualify for refinancing with CommonBond, you must have graduated from a school that included on their list of over 2,000 eligible schools.
Should You Refinance With CommonBond Student Loans?
If you meet their eligibility requirements, you should definitely consider refinancing with CommonBond to benefit from their rate options, attractive discounts, and borrower protections.
However, it’s still a good idea to consider all of your other options. Check out College Raptor’s review of the best student loan refinance companies—where we featured CommonBond!