“You can refinance student loans to a lower interest rate, and that loan will still be limited to qualified education expenses,” says Phil De Gisi, CMO of lender Common Bond, which offers student loan refinancing.
Because the new loan is still a student loan, the borrower can’t use it to pay off debts besides existing college debts.
This could help you pay off debts faster, or lower your monthly payment.
“When refinancing student loans, you can choose which loans to refinance,” De Gisi explains.
This would allow you to replace your existing debts with a single, new loan.
Usually, however, this won’t be a cost-efficient way to manage debts.
Some private lenders can refinance student loans to lower than their current rates, but this is usually because the new loan is still classified as a student loan.Whatever your debt management goals, look at how different refinancing options can help you achieve them.