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Can I Refinance My Student Loans If I Didn't Finish College?

04/28/2015 01:06 pm ET | Updated Jun 28, 2015

Financing one’s higher education is a struggle for many as the average student debt for the graduating class of 2014 exceeded $30,000. Even if you didn’t finish college though, you’re not necessarily stuck with your potentially high interest student loans.

If you would like to lower your interest rates or change your repayment terms, refinancing may be a great option for you. As long as you can prove to a lender that you are a low risk candidate of defaulting on your loans, you will likely receive a refinancing offer.

Here are some key factors making this possible:

  1. Debt to income: This is usually assessed as a ratio of your monthly debt to your monthly income, to help prove to a lender that you have the capital available to repay your loan each month. Minimizing this ratio will help you receive a better offer from a lender.
  2. Credit profile: Your credit profile is very important to lenders. This provides a context for lenders to understand whether or not you will have good payment history over the life of your loan. Credit scores above 640 have the best chance to receive competitive offers from refinancing lenders. The better your credit score, the likely better the interest rate. However, adding a cosigner is a great way to add credibility to your profile in order to receive the best offer possible.
  3. Work History: Lenders will often review your work history to assess your risk as a borrower. For graduates without degrees, lenders may require a more substantial work history to receive a refinancing offer. Employment for at least one to two years post exiting from your degree program will make you an ideal candidate.

Is refinancing worth your time?

It can be! The refinancing market has opened up with a variety of lenders on the market willing refinance your loans. Interest rates are also at market lows with rates starting below 2% APR, so savings can be significant. As competition in the market increases, lending institutions are pressured to find new ways to attract customers, and one way is by streamlining and making the process as simple as possible.

Is there a disadvantage to not having a degree?

Some lenders do require a college degree or a degree from a qualifying institution to be eligible for refinancing. Therefore, if you contact one refinancing lender you may not be eligible and end your search prematurely.

Visit Credible to compare multiple lenders side by side and see what refinancing offers may be extended to you.