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Could student loan refinancing save you money?

Can I Consolidate Student Loans With Bad Credit? It Depends.

Elaine Rubin
Current student loan refinance rates as low as 1.99% to 8.99%. Click here to find a preferred lender.

Can I Consolidate Student Loans With Bad Credit?

When researching your options of either federal consolidation or private student loan refinance, you need to know that these are two different programs. They both combine your loans into one loan, however, they have different credit considerations.

If you’re here because you want to consolidate your federal loans (no private student loans allowed) into a federal Direct Consolidation Loan then your answer is simple, most likely yes.

Student loan refinance is a great option if you are looking to potentially lower your monthly payment, annual percentage rate, or remove a cosigner (like your parent) from an existing loan. However, if you truly have bad credit and want to refinance your private and/or federal student loans, you have an obstacle to overcome. Private student loan refinance lenders will require you to meet certain credit criteria. General requirements, which vary by lender, are typically at least two-years of employment history, and a credit score of at least 680 (or the ability to obtain a cosigner).

What do you do if you want to refinance and do not meet the minimum requirements? You need to take steps to fix your credit.

  1. Review Your Credit Report

    Check your free annual credit report to determine what negative credit items could be affecting your overall score. In order to repair your credit, you’ll have to face the issues head-on. The first step is identifying and understanding the negative items on your credit report.

    If you find anything in your report which is inaccurate, don’t let it go! Credit bureaus have existing processes in place to allow consumers to dispute information on their credit report. Make sure you file a dispute requesting the removal of incorrect information.

  2. Catch Up on Missed Payments

    Do you sometimes forget to pay your bills, or do you frequently pay your bills late? Missed or late payments can have an impact on your credit report. If you are just forgetting to pay certain bills, many services and creditors will let you set up automatic payments, or you can contact your bank and enroll in bill pay.

    Find a way to catch-up, or call your creditor to set up a payment plan if it is too much for you to pay at once. You can also contact a credit counseling agency to help you negotiate debts and payments on your behalf with creditors.

  3. Find Ways to Increase Your Income

    If you’ve been struggling to stretch your paycheck to cover your bills and other living expenses, you may want to consider increasing your income. There are a few different approaches you can take.

    If you are already employed full-time, you may want to check in with your employer to see if there are any opportunities for a raise, overtime, etc. If that is not an option, you can look for part-time job opportunities, including less traditional options like rideshare, and food/package delivery which may offer more flexibility with your existing schedule.

    If you are unemployed or underemployed, start the job search. Look for opportunities which help increase your income to cover your bills. Build up your LinkedIn profile, go to professional meetups and network to help find that next great opportunity to establish or increase your income.

  4. Seek Credit Repair Help

    It can be difficult to come up with a credit repair strategy on your own, but there are credit repair companies that can help you through the process. They offer customized services, and will generally charge a fee, but it may be worth it to help get you back on track.

  5. Stick to Your Plan and Remain Patient

    When it comes to fixing bad credit, it takes time. Just be patient and know that each positive step you take will help you achieve your credit goal. Many banks offer monthly credit monitoring as a benefit or for a nominal fee. Make sure to take advantage of these programs for monthly monitoring to stay motivated and keep track of your progress. Know that it may take three to six months for you to start seeing improvements.

It may take some time for you to fix your bad credit, but the work shouldn’t stop just when your credit is fixed. Keep up the habits you formed while repairing your credit, like automatic payments and monitoring your credit report, to keep your credit healthy.

Once you think you meet the minimum requirements to refinance your loan, you can start applying!

What to do next?

Learn more about student loan repayment options

Tips for handling (and avoiding) student loan default

Lending Partners

This table shows current rates and disclaimers for Discover
Interest Rates Loan Min/Max Repayment Terms  
Discover Student Loans
Fixed as low as: 3.99% 1 Minimum: $5,000  10-20 years Apply Now More Details
Variable as low as: 2.37% 1 Maximum: $150K
Repayment Terms: 5, 10, or 15, 20 years
Degree Requirements: Students with loans from eligible schools may apply.
Apply Now More Details
This table shows current rates and disclaimers for PenFed
Interest Rates Loan Min/Max Repayment Terms  
PenFed Purefy Student Loans
Fixed as low as: 3.25% Minimum: $7,500 5, 8, 12, or 15 years Apply Now More Details
Variable as low as: 2.72% Maximum: $300K
Repayment Terms:  5, 8, 12, or 15 years
Degree Requirements: Must hold at least a bachelor's degree
Apply Now More Details
This table shows current rates and disclaimers for Credible
Interest Rates Loan Min/Max Repayment Terms  
Iowa Student Loan
Fixed as low as: 3.25% 1 Minimum: $5,000 3 5-20 years Apply Now More Details
Variable as low as: 7.25% 1 Maximum: $300K
Repayment Terms: 5-20 years
Degree Requirements: No degree required to refinance
Apply Now More Details
This table shows current rates and disclaimers for CommonBond
Interest Rates Loan Min/Max Repayment Terms  
Commonbond Student Loans
Fixed as low as: 3.20% Minimum: $10,000  5-20 years Apply Now More Details
Variable as low as: 2.14% Maximum: $500K
Hybrid as low as: 3.79%
Repayment Terms: 5, 10, or 15, 20 years
Degree Requirements: Required completion of one of the following degrees at a qualified school: MBA, JD, MD, Engineering
Apply Now More Details
This table shows current rates and disclaimers for LendKey
Interest Rates Loan Min/Max Repayment Terms  
Lendkey Student Loans
Fixed as low as: 3.39% Minimum: $5,000 5, 7, 10, 15, and 20 years Apply Now More Details
Variable as low as: 2.70% Maximum: $300K
Repayment Terms: 5, 7, 10, 15, 20  years
Degree Requirements: Graduated from a LendKey eligible school
Apply Now More Details
This table shows current rates and disclaimers for Sofi
Interest Rates Loan Min/Max Repayment Terms  
SoFi Student Loan Refinance
Fixed as low as: 3.20% Minimum: $10,000 5, 7, 10, 15, 20 years Apply Now More Details
Variable as low as: 2.99% Maximum: No Maximum
Repayment Terms: 5, 7, 10, 15, 20  years
Degree Requirements: Required completion of degree
Apply Now More Details
This table shows current rates and disclaimers for Thrivent
Interest Rates Loan Min/Max Repayment Terms  
thrivent-student-loan-resources-logo
Fixed as low as: 3.74% Minimum: $10,000 5, 10, 15 years Apply Now More Details
Variable as low as: 4.00% Maximum: $120K
Repayment Terms: 5, 10, 15 years
Degree Requirements: Must have graduated from an eligible school.
Apply Now More Details
This table shows current rates and disclaimers for CollegeAve Student Loans
Interest Rates Loan Min/Max Repayment Terms  
College Ave Student Loans
Fixed as low as: 4.64% 1 Minimum: $5,000 3 5 - 15 years 2 Apply Now More Details
Variable as low as: 3.64% 1 Maximum: $300K 3
Repayment Terms: 5, 10, or 15 years 2
Degree Requirements: Must have graduated from a public or private, not-for-profit, degree granting institution.
Apply Now More Details
This table shows current rates and disclaimers for INvested
Interest Rates Loan Min/Max Repayment Terms  
refinance student loans with invested
Fixed as low as: 3.44% 1 Minimum: $5,000 5, 10, 15 & 20 years 2 Apply Now More Details
Variable as low as: 2.48% 1,2 Maximum: 250K
Repayment Terms: 5, 10, 15 & 20 years 2
Eligibility Requirements: Must be a U.S. citizen or eligible non-citizen. Must not have defaulted on any private or government student loan.
Apply Now More Details
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