Earnest Student Loan Refinance – 2024 Review

Key Takeaways

• Earnest offers competitive interest rates starting at 3.95% fixed APR and 5.89% variable APR, including a 0.25% AutoPay discount for eligible borrowers.
• Customizable repayment terms allow borrowers to select plans between 5 to 20 years, tailored to individual financial goals. 
• Earnest distinguishes itself with a no-fee policy, removing charges for applications, origination, prepayments, and late fees.
• Unique features like the skip-a-payment option enable borrowers to skip one payment per year under certain conditions.

Managing student loans can be difficult, particularly when you have several to handle simultaneously. Student loan refinancing is one of the best ways to streamline your student debt, get lower interest rates, or adjust your repayment terms to something more suitable. 

Earnest, a leader in student loan refinancing, is known for its competitive rates, customizable terms, and borrower-focused features. 

Let’s take a closer look at Earnest’s student loan refinance options, eligibility criteria, benefits, and drawbacks to help you decide if it’s right for you. 

What Makes Earnest Stand Out? 

Earnest has established itself as a borrower-friendly lender in the student loan refinance landscape. It’s known for transparency, flexibility, and unique repayment features, which contribute to a seamless refinancing process. 

Competitive Interest Rates With No Hidden Fees

Earnest offers fixed interest rates starting at 3.95% APR and variable rates beginning at 5.89% APR. If you set up automatic student loan payments, you can get a 0.25% AutoPay discount.

Following the recent Fed rate cut, these competitive interest rates are even more attractive. By locking in these historically low rates, you can save thousands over the life of your loan.

Unlike many lenders, Earnest eliminates fees such as origination, application, prepayment, and late fees. 

This means all you have to focus on is paying down the principal without worrying about incurring additional charges. 

Earnest also uniquely offers a 100% rate match guarantee. This means if you can find a lower rate from a competitor, Earnest will match it, ensuring you can get the best deal possible. 

The low interest rates and lack of extra or hidden charges make Earnest one of the top student loan refinancing options in terms of affordability. 

Customizable Loan Terms 

Earnest’s refinancing program allows borrowers to tailor their loan terms. With repayment periods ranging from 5 to 20 years, borrowers have the flexibility to choose the loan term that best aligns with their financial goals. 

Earnest also offers the unique option to set the exact number of months for repayment, giving you unparalleled control over repayment plans. 

If you want to speed up loan repayment, Earnest lets you make biweekly payments, which can lower overall interest costs.

You can also schedule extra payments or make same-day payments without penalties, further emphasizing Earnest’s flexibility for student loan refinancing. 

Pros and Cons of Earnest Student Loan Refinance

Pros

• Streamlined Application Process: Earnest’s digital-first approach, user-friendly platform, and step-by-step guide make refinancing simple from pre-qualification to final approval. 
• Inclusive Eligibility Criteria: Earnest caters to both those with smaller debts and high-balance borrowers, including medical or law school graduates.
• Financial Flexibility: Earnest offers flexible features, such as skip-a-payment, repayment schedule adjustments, and biweekly payment options. 
• Transparency and Support: It provides resources to improve borrowers’ financial literacy as well as tips on budgeting and managing student loan debt. 
• Borrower-Centric Underwriting: Earnest evaluates not only your credit score but other important factors as well, such as employment history, saving habits, and financial discipline, offering a fair opportunity for those with short and long-term credit history. 
• Responsive Customer Support: The in-house customer service team is available via phone, email, and live chat. 
• Soft Eligibility Check: Earnest allows you to do a soft credit check where you can determine your eligibility without affecting your credit score. 

Cons 

• Loss of Federal Loan Protections: When you refinance federal student loans, whether with Earnest or any private lender, you lose access to federal loan benefits, such as income-driven repayment (IDR) plans, deferment, or Public Service Loan Forgiveness (PSLF). 
• Limited Availability for Some States: Earnest doesn’t provide refinancing options for students in Nevada and Kentucky, and variable-rate loans are unavailable in some states, such as Alaska, Illinois, Minnesota, New Hampshire, Ohio, Tennessee, and Texas. 
• No Option for Cosigner: Unlike many private lenders, Earnest doesn’t allow borrowers to refinance with a cosigner. This can make it difficult for applicants with limited credit history or lower credit scores to qualify for the best interest rates. 
• No Mobile App for Loan Management: While Earnest offers a user-friendly web interface, the lack of a mobile app can be inconvenient for borrowers who prefer managing their loans on the go. Many competing lenders provide mobile solutions. 
• No Loan Transfer for Parent PLUS Loans: Borrowers can’t transfer Parent PLUS loans to a student’s name through Earnest refinancing. As a parent who has a Parent Plus loan, you can refinance through Earnest, just under your name, not the student’s. 

Eligibility Criteria for Earnest Student Loan Refinancing

Credit Score Requirements

Earnest requires borrowers to have a minimum credit score of 665, which is slightly higher than some competitors but reflects Earnest’s focus on serving financially responsible borrowers. 

Unfortunately, the absence of a cosigner option may limit accessibility for those with limited credit history. However, borrowers with a strong credit profile can benefit from Earnest’s competitive rates. 

You can improve your credit score before applying by making on-time payments and keeping your debts and liabilities to a minimum. 

Income and Employment Verification

Borrowers are not required to meet a minimum income threshold, but they must either have consistent income or a verified job offer that starts within six months.

This requirement ensures that borrowers have the means to make on-time consecutive payments without defaulting on their loans. 

Earnest also evaluates financial behaviors like saving habits, spending patterns, and employment history. This gives a holistic overview and assessment of borrower reliability beyond just credit scores. 

Residency and Citizenship

To qualify, borrowers must be U.S. citizens or possess a 10-year non-conditional green card. However, Earnest’s refinancing services are unavailable in Kentucky and Nevada, even if you’re a citizen or green card holder. 

Educational Requirements

Borrowers must have attended an institution that is eligible to receive federal financial aid. 

While graduation is typically required, Earnest makes an exception for borrowers who are in their final semester and have a confirmed job offer or consistent income.

Loan Amounts

The minimum refinance loan amount for most states is $5,000, but for California, the minimum is $10,000, and for New Mexico, it is $10,001.

Earnest accommodates both smaller debts and high-balance borrowers, such as medical or law school graduates.

Debt-to-Income Ratio (DTI) Requirements

Earnest allows borrowers with a debt-to-income (DTI) ratio of up to 65% to apply for refinancing. This means that your monthly debt obligations, including rent or mortgage payments, car loans, and other financial liabilities, should be at most 65% of your gross monthly income.

For borrowers looking to qualify for the best interest rates, a lower DTI is recommended. To improve your DTI, consider paying off smaller debts, reducing credit card balances, or increasing your monthly income prior to applying.

Application Process for Earnest Student Loan Refinancing

Earnest simplifies the refinancing process with its digital-first approach, making it accessible and user-friendly. 

Here’s what you can expect during the application process: 

1. Pre-qualification: Earnest allows borrowers to perform a soft credit check to determine their eligibility without impacting their credit score.
2. Rate Estimation: Using Earnest’s online tools, borrowers can get a personalized rate estimate within minutes. This helps compare rates with other lenders before committing to a full application. 
3. Document Submission: After prequalifying, complete the entire application online. You’ll be required to provide documents such as:
   1. Government-issued ID
   2. Pay stubs or proof of income
   3. Tax returns (if applicable)
   4. Details of your current federal or private student loans (loan balances, lender information, and details of any personal loans.)
   5. You’ll also need to link your financial accounts to give Earnest insight into your spending, saving, and earning habits.
4. Approval Timeline: Earnest reviews your application within 2–5 business days. Once approved, it may take an additional 10–15 days for Earnest loans to be disbursed.
5. Customize Your Loan Terms: After approval, you can choose a loan term that meets your financial goals by customizing repayment terms and structuring your repayment plan. 
6. Finalize the Agreement: After selecting your loan terms, review the final agreement and consent to a hard credit inquiry, which is required to finalize the loan.
7. Loan Disbursement: Upon final approval, Earnest will pay off your existing loans directly, which is often known as loan consolidation. You’ll then begin repaying your new loan according to your customized plan.

Earnest Student Loan Refinance Alternatives 

Here are other lenders with refinancing rates and options similar to Earnest.

Who Shouldn’t Refinance Student Loans? 

Refinancing isn’t the best option for everyone. Borrowers should avoid refinancing in the following cases:

• Reliance on Federal Student Loan Protections: If you benefit from programs like IDR, PSLF, or economic hardship deferment, refinancing will eliminate these options. Refinancing private student loans, however, doesn’t come with this risk. 
• Limited Credit History or High DTI: Borrowers with a credit score below 665 or a debt-to-income ratio above 65% may not qualify for Earnest’s competitive rates.
• Unstable Financial Situation: If you lack consistent income or a financial safety net, refinancing may not be ideal, as private loans often require strict repayment schedules.

Maximize Your Savings with Student Loan Professor

Thinking about refinancing with Earnest? As a Student Loan Professor client, you can take advantage of the 0.25% AutoPay discount, helping you secure lower rates and save more over the life of your loan.. Start your Earnest refinancing journey to secure this special offer!

Brandon Barfield

Brandon Barfield is the President and Co-Founder of Student Loan Professor, and is nationally known as student loan expert for graduate health professions. Since 2011, Brandon has given hundreds of loan repayment presentations for schools, hospitals, and medical conferences across the country. With his diverse background in financial aid, financial planning and student loan advisory, Brandon has a broad understanding of the intricacies surrounding student loans, loan repayment strategies, and how they should be considered when graduates make other financial decisions.