How to Refinance Medical Student Loans in Residency

By Mentor Staff | Edited By Mentor Staff

Updated On January 12, 2022

Editorial Note: This content is based solely on the author's opinions and is not provided, approved, endorsed or reviewed by any financial institution or partner.

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Student loan refinancing during medical residency or dental residency is an important decision that should be made carefully. With medical resident student loan refinancing, you can save thousands or tens of thousands on dollars on your medical student loans. You can refinance federal student loans, private student loans or both. When you refinance student loans during residency and fellowship, a private lender will give you a new student loan that will be used to consolidate and pay off your old student loans. Student loan refinancing helps you get a lower interest rate, lower monthly payment or both. The goal of student loan refinance during your medical residency or dental residency is to pay off student loans faster and get out of debt, which can be especially helpful when you have a large student loan balance from medical school or dental school.

Here is a step-by-step guide how to refinance student loans in residency:

Top Picks For Medical Resident Refinancing

December 2022

Variable APR ?APR, or Annual Percentage Rate, is the price you pay to borrow money. Variable APR means that your interest rate can fluctuate over time, which can increase or decrease your monthly student loan payment. Typically, a variable-rate loan has a lower introductory rate than a fixed-loan rate loan. Variable APR includes a 0.25% discount when you enroll in autopay.
Fixed APR ?APR, or Annual Percentage Rate, is the price you pay to borrow money. Fixed APR means that your interest rate will always stay the same. Even if interest rates change, your interest rate or monthly payment will not. Fixed APR includes a 0.25% discount when you enroll in autopay.
APR
4.49% - 8.24%
4.49% - 8.24%
4.49% - 8.24%

View Details

on SoFi's website

Overview

Variable APR:
4.49% - 8.24%
Fixed APR:
4.49% - 8.24%
Minimum Credit Score:
650
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$10,001

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states, except MS and MT
Hardship Deferment:
Yes
Co-signer Option:
Yes
-
4.10% - 8.21%
4.10% - 8.21%

View Details

on ISL's website

Overview

Variable APR:
-
Fixed APR:
4.10% - 8.21%
Minimum Credit Score:
670
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000 ($10,000 in CA)

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states, except OR and ME
Hardship Deferment:
Yes
Co-signer Option:
Yes
5.09% - 10.48%
5.39% - 10.68%
5.09% - 10.68%

View Details

on Citizens' website

Overview

Variable APR:
5.09% - 10.48%
Fixed APR:
5.39% - 10.68%
Minimum Credit Score:
Not disclosed
Minimum Income:
$24,000
Fees:
No prepayment or origination fees
Minimum Loan Amount:
$10,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states
Hardship Deferment:
Yes
Co-signer Option:
Yes
5.81% - 6.91%
5.90% - 7.00%
5.81% - 7.00%

View Details

on Splash's website

Overview

Variable APR:
5.81% - 6.91%
Fixed APR:
5.90% - 7.00%
Minimum Credit Score:
640
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5 – 25 years
Borrower Residency:
All states
Hardship Deferment:
Varies
Co-signer Option:
No
5.81% - 6.91%
5.90% - 7.90%
5.81% - 7.90%

View Details

on Laurel Road's website

Overview

Variable APR:
5.81% - 6.91%
Fixed APR:
5.90% - 7.90%
Minimum Credit Score:
660
Minimum Income:
None
Fees:
None
Minimum Loan Amount:
$5,000

Details

Eligible Loans:
Private & Federal
Eligible Degrees:
Undergraduate & Graduate
Loan Terms:
5, 7, 10, 15, 20 years
Borrower Residency:
All states
Hardship Deferment:
Yes
Co-signer Option:
Yes
  1. Decide student loan refinancing is right for you
  2. Compare lenders
  3. Compare interest rates
  4. Select student loan terms
  5. Apply
  6. Sign documents
  7. Student loan gets disbursed

Decide student loan refinancing is right for you

Determine what your financial goals are when you refinance student loans during residency. Do you want a lower interest rate? Do you want a lower monthly student loan payment? Do you want to save money? Do you want to pay off your student loans faster? Most residents who refinance student loans have at least some, if not all, of these goals. Refinancing private student loans is an obvious choice because you can pay as low as $75 or $100 per month during residency. If you plan to enter public service or plan to use an income-driven repayment plan such as IBR, PAYE, REPAYE or ICR, then you may want to not refinance federal student loans. However, if you don’t plan on seeking public service loan forgiveness or your future income or spouse’s income won’t give you the financial benefit of an income-driven plan, then you may want to refinance federal student loans now to get the maximum financing savings. Like private student loans, you can pay as low as $75 or $100 on your federal student loans too during residency when you refinance.

Compare lenders

Only certain lenders will refinance student loans during residency. To maximize your chances for approval for medical residency refinancing, you should apply to all these student loan companies to find the best student loan refinancing lender and student loan refinancing rates for you. You can evaluate interest rate, student loan repayment options, state of residency requirements, minimum credit score, minimum income and any other loan terms. There are many benefits to refinance student loans during residency, including:

  • Lower interest rates
  • Lower monthly payment
  • Improved cash flow
  • Save money
  • Pay off student loans faster
  • Better customer service
  • Ability to choose a fixed interest rate
  • Ability to choose a new student loan repayment term

Compare interest rates

Most lenders will allow you to check your interest rate before applying for medical resident refinancing. This process is called a soft credit check, typically takes a few minutes, and does not impact your credit score. Make sure to compare interest rates across lenders, including both fixed and variable interest rates. Fixed interest rates will remain the same over the life of your loan, whereas variable interest rates can increase or decrease over the life of your loan. Typically, variable interest rates are lower than fixed interest rates. This student loan refinancing calculator can show you how much money you can save when you refinance student loans during residency.

Select your student loan terms

Evaluate all loan terms, including interest rates, student loan payoff period, minimum credit score and minimum income, as some examples. You should evaluate how long you want to take to pay off your student loans. You can typically choose a student loan repayment term from 5 to 20 years. A shorter student loan repayment period such as 5 years will have a relatively higher monthly payments, but you will save the most amount of interest. In contrast, a 20-year student loan repayment period will have a relatively lower monthly student loan payment, but will cost you more in total student loan interest. Most lenders require a minimum credit score of 650, but the higher your credit score, the better. Lenders also may evaluate any other debt you have such as credit card debt or a mortgage. They also may evaluate your monthly cash flow to determine whether you can pay your student loans and other living expenses. Since student loan refinancing during residency results in a $75 or $100 monthly student loan payment, many borrowers can meet this requirement. Ideally, you would choose a lender that offers the lowest interest rate and a student loan repayment term that meets your unique financial goals. A shorter repayment period such as 5 years typically has a lower interest rate than a longer repayment period such as 20 years.

Apply

The application for student loan refinancing during residency typically takes 10-15 minutes to complete with lender and can be completed online. A lender may request the following documents:

  • Proof of citizenship or residency (government ID or Social Security Number)
  • Valid ID (driver’s license or passport)
  • Proof of income (pay stubs or job offer letter)
  • Transcripts or proof of graduation
  • Student loan statements (from your current lender)

When you apply for student loan refinancing during residency, a lender will conduct a hard credit pull. If you apply to multiple lenders in a short time period, your credit report typically should only reflect one credit inquiry. Lenders may evaluate your credit score, debt-to-income and other debt obligations. You can also apply with a cosigner. A cosigner such as a parent, spouse or relative with a strong credit and income profile can help you get approved and get a lower interest rate.

Sign documents

Once you get approved and choose your lender, it’s time to sign your student loan documents and disclosures. This will include your Master Promissory Note, which governs the terms and conditions of your student loans.

If you’re not approved for student loan refinancing during residency, you can ask your lender for feedback. You may not have been approved for several reasons, including your credit score, monthly cash flow, other debt or your debt-to-income ratio. It’s also possible that you need to apply with a cosigner to help you get approved and get a lower interest rate. Earning more income, cutting expenses or paying off debt may help increase your chances for approval.

Loans get disbursed

The final step in the process of medical resident refinancing is for your student loans to get disbursed. Your new student loan lender will pay off your old student loans. You should keep making student loan payments to your old lender until your new lender instructs you to start making student loan payments to your new lender. Make sure to update your autopay at this point. Most lenders will also discount your interest rate by 0.25% when you sign up for autopay.

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