Student loan refinance calculator: How to calculate your payments

A student loan refinance calculator can help you determine how much your payments would be if you refinance your loan. Here's how to use it. (iStock)

Student loan refinancing involves paying off current school loans with a new refinance loan. If your new loan comes with more favorable terms, such as a lower interest rate or better loan repayment plan, you can save money on monthly payments and total costs (maybe even thousands of dollars) over time. You may also be able to change loan terms to access more borrower benefits. So, the question is: Should you refinance your student loan nows?

To determine that, you're going to want to use a student loan refinance calculator.

A student loan refinance calculator can help borrowers — especially those with private student loans — determine if refinancing is the right choice. It can estimate your new monthly payments and determine if you can save money.

Student loan refinance calculator

A student loan refinance calculator is a tool you can use to understand the financial impacts of refinancing. Credible's refinancing calculator allows you to input details about your current educational debt and a possible refinance loan so you can see how your situation would change if you refinance.

Just enter some simple personal information into Credible's free tools to see if a new loan term will save money.

Some details you'll need to include to use the calculator are:

  • Your loan balance amount.
  • The interest rate, monthly payment, and remaining payment time left on your current loan.
  • The interest rate, monthly payment, and repayment timeline for the refinance loan you're considering.

After inputting the info, the calculator will tell you two things:

  • Monthly savings
  • Lifetime savings

Use a savings calculator to see if your new loan would be less costly and easier for you to pay back. After all, the goal is to cut down your loan payment and loan balance over time.

If you find refinancing would save you money, then you should move forward with the process using multi-lender marketplace Credible. Credible can help you compare refinance lenders and find a lower interest rate.


Should I refinance my student loans?

Remember: If you have federal student loans, you want to carefully weigh the pros and cons of refinancing first. Here's what you need to know about refinancing federal student loans vs. private student loans.

Federal student loans

If you have federal student loans, you likely should not refinance them. Federal loans come with special benefits such as the option to change your payment plan, to qualify for Public Service Loan Forgiveness (PSLF) if you're in an eligible position, or to opt for a student loan income-driven payment plan.


Private student loans

If you have private student loans, refinancing could potentially save you thousands of dollars in interest. Interest rates are currently near record lows so many people who have outstanding school loans could lower the rate they're paying by refinancing. With a lower rate, more money goes to principal and repayment becomes cheaper and easier.

Again, make sure you use a refinance savings calculator to crunch the numbers.

If you're satisfied with the results and believe you can save money with a refinance right now, then you should get started with the application via Credible. Credible can help you check your rates and find the refinance lender for you.

Exactly how much you can save depends on the rate you qualify for, as well as the new loan term you select. If you make repayment longer, you can drop your monthly payments even more but it may reduce your interest savings over time or you may even end up paying more interest due to the longer timeline. But if you keep your loan term the same or shorten it, the savings over the life of your loan can be substantial (if you qualify for a lower interest rate).

Refinancing also gives you the option to choose a new loan servicer since you don't have to refinance with your current lender. If your existing servicer offers poor customer service; has limited options for forbearance; or otherwise isn't meeting your needs, your new refinance lender may be a better fit.


How do I get the best student loan refinancing offer?

Refinancing is the right financial move only if a student loan refinancing calculator shows that taking out a new student loan refinance loan can save money compared with your current loan.

To maximize savings, it's important you get the best student loan refinancing offer. To do that, you'll want to make sure you appear to be a well-qualified borrower to potential lenders. Lenders consider your credit score and the amount of debt you have, relative to your income, in determining what rate to offer you or whether to approve you at all.

Working on improving your credit and reducing your debt balance can help you get a better rate. You may also want to ask someone with ample income and solid credit history to cosign for you if you're concerned about qualifying for the best rates based on your own work or credit history.

It's also a good idea to shop around and get quotes from multiple student loan refinancing companies as rates and terms can vary.

Visit Credible today to find low rates and quotes from multiple refinance lenders without affecting your credit score. Once you see your loan offers, you can use Credible to see which loan offer is the best for your situation.