I recently re-consolidated and refinanced my student loans because of a low interest rate offered through First Republic Bank, 1.95% APR over 5 years. I did the math and created a table comparing and contrasting my loans like before consolidation, after my first consolidation with SoFi and now, after refinancing with First Republic Bank.
While not necessarily an apples to apples comparison because of the different loan amounts as well as the expected time to repay them, the general idea of consolidating and refinancing is to save money and certainly, I will say that I achieved that goal.
Just consolidating with SoFi alone saved me ~$16,000 in interest payments AND it allowed me to knock off 3 years of having to make student loan payments. But, with refinancing through First Republic Bank, I’m able to save ~$36,000 along with 5 years of having to make payments (if I’m comparing this to my original mix of federal and private loans).
If I were to compare my refinanced loans through FRB with my SoFi consolidation, I’d have saved ~$10,000 and am on track to paying off the loans 2 years earlier, which is still amazing.
One caveat to all of this, my monthly payment will be a whopping $2,118!!! It’s an exorbitant amount of money, but I have to say, over the course of 2 years, I’ve come to realize how much I hate having debt. The idea of having to juggle between different kinds of debt, whether student loans, credit card debt (which I have none), and/or mortgage, is just too much for me on a personal level. So, if I can pay off my debt in as short amount of time as possible WHILE minimizing the amount of interest I have to pay, I’m going to choose that route 9 times out of 10, even if it means I’m making $2,000 monthly payments.