Accumulated student loans can leave students feeling as if they were stuck with the interest rates they have. High-interest rates, coupled with a sizeable loan balance can sometimes mean that you have to pay huge sums in interest during the term of the loan. However, there is some good news. Student loan refinancing presents a chance for lowering interest rates and making the repayments more manageable. Here refinancing means the replacement of an existing loan with another debt obligation under different terms. There are many reasons for loan refinancing, including to benefit from better interest rates. In the arrangement, the new loan pays off the previous debt with better terms or features adjusted to your finances. Details of such deals vary from one lender to the other, although the process generally follows this format:
- One has an existing loan that they wish to improve
- They find a lender offering improved terms, and apply for a new loan
- The new arrangement pays off the existing debt completely
- You then make fresh payments on the new loan
There are many companies that offer loan refinancing options, although this article focuses primarily on Laurel Road (formerly referred to as DRB or Darien Rowayton bank). We provide careful road loans refinance review, with the goal of helping you decide whether it is a rational choice.
Why Refinance with DRB Loans is the Best Solution
Darien Rowayton bank student loans are greatly popular as a way to relieve the pressure on young professionals. DRB is a financial institution that offers multiple produces, with student their student financing option, offered through their Laurel Road faction. Through this arrangement, borrowers are able to:
- Possibly secure reduced interest rates
- Decide between variable and fixed interest rates
- And choose between longer or shorter repayment plans
However, there are certain things that borrowers need to consider before going for the DRB student loans. For instance, through the refinancing process, what you are doing is applying for a private loan. In the event that you already have private loans, then this may not be a significant issue. However, if you have a federal student loan, then you forfeit your federal student protections, including:
- Income-Driven Plans
- The possibility of loan forgiveness
- Forbearance and deferment in case of a serious financial hardship
Please keep in mind that the refinancing process is non-reversible. In other words, it is impossible to go back to claim these federal benefits once forfeited. This does not mean that you should never consider refinancing.
As part of this road loans review, it helps to consider regarding some situations when refinancing is an ideal solution. Although you may forfeit some federal benefits, this refinancing option does offer some protections and perks. For instance, in the event that you encounter economic hardship, there is a possibility of extending your monthly payments for one or more 3-month durations. However, you are not allowed to extend beyond 12 months in aggregate during your loan’s term. In addition, Laurel Road also provides certain benefits in case of disability and death. For instance, in the event that the borrower becomes permanently disabled or dies, the bank forgives the total amount of the refinanced loan.
Is Opportunity Loans Legit, or Should Borrowers Be Cautious?
With the growth of student loan debts, institutions like Laurel Road, Prosper and Earnest have come up with loan refinancing programs as ways of helping borrowers save money in the long run and hasten the process of repaying loans. Road loans interest rates vary according to the study level, with in-school MBA loans attracting the highest. The rates, in general, are either lower than or equal to the rates currently available for federal student loans. Here is a summary of the rates:
Please note that it is possible to earn significant savings by paying off your loans in short durations. However, this will also mean that your payments will be much higher compared to when you pay over longer periods.
But, is road loans legit? To answer the question, yes, the refinancing option by DRB is very legitimate with demonstrable benefits. One of the main attractions of laurel loans is that borrowers get big savings through the refinancing. The institution approximates the savings at around 20,000 USD. This is because you get shorter repayment periods, cutting off your interest payments from piling up over decades. In addition, using a variable-rate refinancing option implies that your loan’s interest rates will fluctuate according to the prime rate, which reduces in good economic times and escalates during bad ones. While the variable rates implemented on DRB bank student loans often start with rates that are lower than the federal fixed-rate loans, it is highly likely that, over time, they will be higher. This makes refinancing with variable rates a gamble.
How Does One Apply for Laurel Road Student Loans?
To qualify for the roadside loans refinancing arrangement, borrowers are required to fill in an application online, providing required personal details. You will also need to indicate the amount to be refinanced and your yearly earnings. In the event that your credit is not strong, you may be required to add a cosigner. The road loans customer service is quite responsive, and you should hear back on your application within a few days.
There are some specific road loans car requirements that you need to know about. Keep in mind that DRB is a private financial institution, meaning that there are stricter eligibility requirements. In general, you should be:
- Gainfully employed
- A citizen of the United States
- Have at least a bachelor’s degree
Please note that it is not mandatory to refinance all your student loans if you do not wish to. There is an option of refinancing a private loan and leaving your federal loans and benefits intact. Most importantly, DRB has an incredible customer support service, reachable through multiple platforms, either on the website or by the telephone. Make inquiries if you have any concerns.