What Student Loan Refinance Rate Will Save Me?
This calculator finds the highest refinance rate that still produces net savings on your student loan after closing costs and any term change. Enter your balance, current rate, remaining term, new term, and closing costs. The result is a threshold: any offer at or below it saves money, anything above it costs more than your current loan.
Your payment goes up by
Your payment falls by
a month — against the old figure, or a day.
Nothing changes — the two payments you entered are the same.
- Old payment
- New payment
- Monthly change
- Over a year
- Over five years
- Share of take-home, before
- Share of take-home, after
Budget the difference before the first new bill lands — a year has to come from somewhere.
Straight arithmetic on the two numbers you entered. Payments under income-driven plans are recertified every year, so treat any figure as good only until your next recertification date.
How the Threshold Rate Works
Most borrowers approach refinancing with a rate already in hand and ask whether it saves them money. This calculator inverts the question: given your balance, remaining term, and closing costs, what is the highest new rate that would still leave you better off? That threshold gives you a benchmark to evaluate any offer instantly, without running a full amortization each time.
The threshold is sensitive to two inputs. A higher balance makes even a small rate reduction worth more in absolute dollars, which pushes the threshold closer to your current rate. Higher closing costs push it lower because the savings must first recover those costs. On an illustrative $60,000 balance with $1,000 in closing costs and eight years remaining, the threshold rate may sit only half a point below your current rate. On a $120,000 balance with the same costs, it may sit within a quarter point. Enter your own numbers to see where the line falls for your specific situation.
Using the Threshold During Rate Shopping
Once you know your threshold rate, the shopping process becomes efficient. Request pre-qualification from several lenders within a concentrated window of 14 to 45 days so that FICO scoring models treat the inquiries as a single event. Compare each offer directly against your threshold: any offer below it is worth pursuing, any offer above it is not.
Keep in mind that the threshold assumes you hold the new loan to maturity. If you plan to pay off the balance early or refinance again, the effective threshold drops because you have fewer months to recover closing costs. Refinancing federal loans into a private loan also permanently removes access to income-driven repayment, PSLF, forbearance, and disability discharge, so the dollar threshold is only one dimension of the decision. For a month-by-month view of when savings cover costs, see the break-even calculator. For a broader decision framework, use the worth-it calculator.
Threshold rates are illustrative and depend on your specific balance, term, and closing costs. This tool does not constitute a loan offer.
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Related student loan calculators
- Student Loan Refinance Break Even Calculator
- Student Loan Refinance Savings Calculator
- Should I Refinance Student Loans Now or Wait?
Sources
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Sources: standard amortization math (solving for rate given target total cost); FICO inquiry deduplication (14-45 day window).
- Federal Direct Consolidation Loan interest rate — the weighted average of the loans being consolidated, rounded up to the nearest one-eighth of one percent (Federal Student Aid, studentaid.gov, Loan Consolidation).
- Amortisation, daily interest accrual and payoff arithmetic — standard loan mathematics; every figure on this page is computed from the numbers you enter.