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PenFed Powered by Purefy Student Loan Refinancing Review

April 13, 2018
Loans, Student Loans
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Purefy has been in the student loan refinancing business since 2014, helping borrowers get lower rates on existing federal or private student loans, including parent PLUS loans.

Purefy-issued loans are funded by multiple lenders. This review focuses on Purefy’s partnership with Pentagon Federal Credit Union, known as PenFed.

You don’t need to be an especially high earner to qualify as long as you’re employed, have good credit and have a manageable amount of debt relative to your income. PenFed refinances student loan debt for professionals of all kinds, whether you’re a police officer, a teacher, a doctor or a lawyer.

PenFed also stands out because it’s one of the only lenders that allows married couples to refinance student loans together. But unlike most refinance lenders, it doesn’t offer a structured deferment or forbearance program, which would let borrowers pause payments if money got tight.

Student loan refinancing means replacing one or more student loans with a single lower-rate loan. It may be right for you if you:

  • Have private student loans, or have federal student loans and don’t plan to use federal benefits such as income-driven repayment and loan forgiveness — you’ll lose access to those programs if you refinance.
  • Have good credit, a stable income and a history of paying your debt on time.
  • Want to transfer PLUS loans from a parent to child.
  • Want to consolidate your student loans with your spouse’s — PenFed is one of the few lenders that allows this.

You’ll save the most money by choosing the shortest repayment term you can manage. Refinancing isn’t for you if you have poor credit or an uncertain job situation, or if you have federal loans and want to pursue an income-driven repayment plan or loan forgiveness program.

» MORE: Compare student loan refinance lenders

Type of loanStudent loan refinancing
NerdWallet rating4.5 stars out of 5
4.5 out of 5.0 stars
Interest rates (APR)Fixed: 3.25% - 7.03%
Variable: 2.70% - 7.44%
Loan terms5, 8, 12 or 15 years
Loan amounts$7,500 to $300,000
Sign-up bonusEarn a $200 sign-up bonus when you apply using the NerdWallet button below
Rates updated August 1, 2018.
Check Rates At PenFed

Can you qualify?

Generally, you’ll have a good shot of qualifying if you have good credit and enough income to afford your debts — or a co-signer who does. PenFed’s specific income and credit score requirements for student loan refinancing vary depending on the amount of debt you’re refinancing, and whether you’re applying solo, with a spouse or with a non-spouse co-signer. You’re eligible if you:

  • Are a U.S. citizen.
  • Graduated from an approved school. You need a bachelor’s degree or higher from a Title IV-accredited school.
  • Have good credit. You’ll need at least a 670 credit score, and a higher score if you’re applying without a co-signer or refinancing more than $150,000.
  • Have enough income to afford loan payments. You’ll generally need an income of at least $25,000 if you’re applying with a co-signer, and $42,000 if you’re applying without one. If you’re refinancing more than $150,000, the minimum income is $50,000 or $100,000, depending on how much other debt you have.

PenFed credit score requirements for loans of $7,500 to $150,000
Applicant typeMin. borrower credit score
Min. co-signer credit score
No co-signer700
Spouse as a co-signerOne spouse must have a 700 or higher, and the other needs a 670 or higher.
Non-spouse co-signer670720

PenFed credit score requirements for loans of $150,000+

Applicant typeMin. borrower credit score
Min. co-signer credit score
No co-signer725
Spouse as a co-signerOne spouse must have a 725 or higher, and the other needs a 670 or higher.
Non-spouse co-signer670725

PenFed income requirements for loans of $7,500 to $150,000
Applicant typeMin. borrower income
Min. co-signer income
No co-signer$42,000
Spouse as a co-signer$42,000 combined$42,000 combined
Non-spouse co-signer$25,000

PenFed income requirements for loans of $150,000+

Applicant typeMinimum income
No co-signer or non-spouse co-signer$50,000 if DTI* is 40% or less;
$100,000 if DTI is 40% to 45%
Spouse as a co-signer$50,000 combined
*Calculate your DTI, or debt-to-income ratio. Applicants with undergraduate degrees need a DTI that’s 35% or lower to qualify with PenFed. Applicants with graduate degrees need a DTI that’s 40% or lower.

How to refinance with PenFed through Purefy

Before you decide on a student loan refinance lender, compare multiple options to make sure you’re getting the best rate you qualify for. In addition to interest rates, compare lenders’ repayment options and the flexibility they offer to borrowers who are struggling to make payments.

If you’re ready to refinance with PenFed, you can apply on Purefy’s website. Purefy will assign a dedicated loan advisor to answer questions you have throughout the process. Here’s how to apply:

1. Estimate your rate. Provide your education details, estimated credit score and loan information to get an estimate of the new interest rate and potential savings you could qualify for.

2. Choose a loan term and type. You’ll save the most money by choosing the shortest loan term you can manage. You can also pick either a fixed or variable interest rate — fixed rates will stay the same throughout the life of the loan and variable rates are subject to change monthly.

3. Complete an application. You’ll be redirected to PenFed for the loan application. Create a profile and enter the following information:

  • Social Security number
  • Driver’s license, passport or state ID number
  • Monthly housing payment
  • Education and employment details
  • Details about the loans you’re refinancing

If you’re not already a PenFed member, you’ll need to indicate that you’re willing to become one. The membership won’t cost you anything, and the application is integrated with your student loan refinancing application. As a PenFed member, you’ll have access to the credit union’s other financial products and get discounts on financial services from companies that PenFed partners with.

» MORE: NerdWallet’s PenFed Credit Union review

4. Add a co-signer (optional). Applying with a co-signer can help you qualify for a lower rate, and it’s necessary if you don’t meet the minimum credit and income requirements for applying without one. Enter your co-signer’s contact information; they’ll receive an application via email.

After you — and your co-signer, if you have one — submit the application, PenFed will do a hard credit check on each of you. A hard pull could affect your credit score, but it’s routine for lenders to do before approving applicants for a loan.

5. Upload the necessary documents. You’ll need:

  • A recent pay stub or tax return
  • A copy or photo of your transcript or diploma to verify your degree
  • Payoff statements from your existing lender or servicer for the loans you want to refinance

6. Wait for approval and payoff. If you’re approved, you’ll need to sign the loan document. PenFed will pay off your existing lender or servicer, which typically takes up to 14 business days. Continue making regular loan payments to your existing lender or servicer until you receive confirmation that PenFed has successfully paid the loan off. Going forward, you’ll make monthly student loan payments to PenFed.

Check Rates At PenFed

More PenFed student loan refinancing details

  • Loan servicer: Pentagon Federal Credit Union, known as PenFed
  • Application or origination fee: No
  • Prepayment penalty: No
  • Late fees: Yes; a fee equal to 20% of the interest portion of the payment applies after the payment is five days late. The minimum late fee is $5; the maximum is $25, except where prohibited by law.
  • Co-signer release option: Yes, after the primary borrower makes 12 consecutive on-time payments — this is a more generous co-signer release policy than some other student loan refinance lenders offer. (Not applicable on spouse loans).

Repayment options for struggling borrowers

PenFed doesn’t have any structured deferment or forbearance programs, unlike other lenders. If you lose your job or experience an illness or death in the family, the lender may offer temporarily payment relief on a case-by-case basis.

PenFed and Purefy extras

You can reap the following benefits by refinancing your student loans with PenFed through Purefy:

  • Couples refinancing: Spouses who both have student loans can qualify to refinance with PenFed based on their combined incomes and the higher credit score of the two. This means the spouse with the lower credit score would likely qualify for a lower interest rate than he or she would otherwise.
  • Purefy referral program: Earn $200 cash for each friend you refer who receives a loan through Purefy.

PenFed student loan refinancing FAQs

  • Can I apply with a co-signer? Yes
  • Is there a co-signer release option? Yes, after the primary borrower makes 12 consecutive on-time payments.
  • Can I qualify if I’ve filed for bankruptcy in the past? Yes, if the bankruptcy was 10 or more years ago. You can also qualify — even with a recent bankruptcy on your record — if you have a co-signer who meets all of the credit, income and debt-to-income criteria, and you have at least a 670 credit score and $25,000 annual income.
  • Can I qualify if I didn’t go to a Title IV-accredited school? No
  • Can I qualify if I didn’t graduate? No

» MORE: Read more student loan refinancing FAQs

Contact PenFed and Purefy

Contact Purefy for questions before and throughout the application.

  • Call: 202-524-1115
  • Text: 202-688-5572
  • Email:

Contact PenFed with questions about repayment.

  • Call: 800-247-5626 or 202-888-4320
  • Text: 202-780-7195
  • Email:


NerdWallet believes the best student loan is one you can repay at the lowest interest rate you can get. That’s why NerdWallet’s private student loans ratings reward lenders that offer a variety of loan terms, limit their fees and penalties, and extend borrowers multiple options to avoid default. Points are also awarded for soft credit checks, underwriting transparency and other consumer-friendly features. Use these ratings as a guide, but we encourage you to shop around for the lowest interest rate you can qualify for. NerdWallet does not receive compensation for its reviews. Read our editorial guidelines.

5 stars out of 5 — Among the very best for consumer-friendly features

4.5 stars out of 5 — Excellent; offers most consumer-friendly features

4 stars out of 5 — Very good; offers many consumer-friendly features

3.5 stars out of 5 — Good; may not offer something important to you

3 stars out of 5 — Fair; missing important consumer-friendly features

2.5 stars out of 5 — Poor; proceed with great caution