Should You Refinance Your Student Loans in 2017?

The answer to this question is different for everyone. If you recently refinanced your loans, chances are you won’t gain much benefit from another refi. Or you may have such great terms in place already that a refi doesn’t make sense.

However, the vast majority of students should at least look into the prospect of refinancing student loans to lock in lower interest rates and gain other benefits. It’s important to shop around, run the numbers, and make sure you’re getting the better end of the deal, but here are several reasons you may want to refinance in 2017.

Interest Rates are Still Low

The economy is rapidly recovering from the Great Recession, and even though the prime has remained relatively low, it is slated to increase in 2017. This is especially true if improving trends in the stock market linked to the new White House administration continue once Donald Trump takes office in January. In short, now is the time to refinance, before the prime starts to climb and interest rates for loans follow suit.

Consolidate Payments

If you’re like most students, you’ll take out several loans during the time you’re in college. Once you graduate, you could find yourself paying a slew of bills each month.

The inconvenience can be somewhat mitigated by setting up automatic payments through your bank, but then you have to make sure there are adequate funds in your account at the time payments are taken each month, and missing a payment can incur penalties that increase your costs. In addition, you may be contending with several different interest rates.

Refinancing allows you to roll all of your loans into a single loan and lock in a low interest rate. This can decrease costs, both monthly and over time, as well as make paying a lot more convenient.

Shorten Your Term

When you’re in college and you have no idea what kind of job you’ll have after graduation, certain loan terms that offer low payments may seem like a good idea. Unfortunately, these loans often include extended payment times that end up racking up interest charges.


A refi company like Ameritech can help you to lower interest rates and shorten your term for repayment, saving you a ton in interest over time. Once you have a good-paying job, this may be preferable to prior loan terms.

Become Independent

Most college students don’t have any credit, which means their parents (or other loved ones) end up cosigning on loans. When you’ve found gainful employment, it’s time to release cosigners and gain your financial independence. Refinancing can help you to do this.

Increase Flexibility

Refinancing your student loans to lock in a single, low interest rate can reduce your monthly payments and free up some cash without increasing your overall expense. This, in turn, can give you more flexibility where spending is concerned.

You could, for example, pay down the principle on your student loan debt more quickly. Alternately, you might sock away extra cash to save for a down payment on a house or funnel it into your retirement accounts where it will start earning compound interest. A refi now could not only save you money, but contribute to earnings over time.