Earnest Student Loan Refinancing Review

Loans, Student Loans
Earnest Giving Student Loan Borrowers Refinancing Flexibility

With its broad qualification criteria and customizable repayment options, Earnest’s student loan refinancing is particularly appealing for people with short credit histories and entry-level incomes.

Like many student loan refinance lenders, Earnest offers student loan refinancing for borrowers with loans from undergraduate or graduate degrees, and for parents who took out federal PLUS loans to pay for their child’s education.


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AT A GLANCE

  • Fixed rates: 3.20% to 6.39% APR. Variable rates: 2.65% to 6.19% APR.
  • Available loan terms: Personalized terms between 5 and 20 years (180 options total)
  • Eligible loan balances: $5,000 to $500,000

Note: Once you refinance a federal student loan, you lose access to federal loan perks including income-driven repayment and loan forgiveness programs. Weigh this trade-off carefully.

Do you qualify?

 Minimum qualifications
The typical borrower
Credit scoreNo requirement700+
IncomeNo requirementCan comfortably afford expenses, saves money regularly, and has a retirement savings account.
EducationDegree from a Title IV accredited school or plans to graduate this semester.Degree from a Title IV accredited school or plans to graduate this semester.

In addition to the qualifications above, borrowers must be employed, have a written offer for a job that starts within six months or have another source of income to comfortably afford the loan payments.

Most Earnest clients have a history of making on-time payments, don’t regularly incur late, overdraft or insufficient funds fees, and don’t have recent bankruptcies or accounts in collections.

» COMPARE: Student loan refinancing options

Where Earnest shines

Borrowers can customize their interest rate and loan term: Earnest’s unique Precision Pricing model gives borrowers more flexibility than is available with other lenders. Borrowers can select the exact amount they want to pay each month and Earnest adjusts their loan term and interest rate accordingly.

Various flexible repayment options: Earnest gives borrowers the option to:

  • Make biweekly payments to lower the total interest paid over time
  • Extend a payment due date up to seven days
  • Skip a payment once every 12 months after they’ve made consecutive on-time payments for six months
  • Switch between fixed and variable interest rates once every six months after making at least six months of consecutive on-time payments

Services loans in-house: Earnest is one of the only lenders that collects and manages payments itself; most other lenders hire third-party servicers to do this work. So, if you have any questions about your loan, you can contact the company directly via phone, email, text or an online chat feature, instead of tracking down an outside loan servicing company.

Where Earnest falls short

Borrowers can’t apply with a co-signer: Earnest is one of the only lenders that doesn’t allow borrowers to apply with a co-signer. Most other student loan refinance lenders encourage borrowers to apply with co-signers to potentially qualify for a lower rate.

Only available in 44 states and Washington, D.C.: Earnest isn’t available to borrowers in six states: Alabama, Delaware, Kentucky, Mississippi, Nevada and Rhode Island. Residents should consider one of the many other student loan refinancing lenders that serve borrowers in those states.

Loan details

Fees: No origination or prepayment fees.

Loan servicing: Earnest

Deferment and forbearance: Borrowers may be able to defer payments while pursuing a graduate degree, or serving in the military or Peace Corps. Forbearance is available to borrowers who involuntarily lose their job or have an increase in nondiscretionary spending, such as medical costs or child care.

Next steps

It’s smart to compare several refinance lenders before choosing one. If you’re sold on Earnest, you can apply directly on the lender’s site. The lender will do a soft credit pull, which won’t hurt your credit score, to give you a rate estimate. Then, like all lenders, Earnest will do a hard credit pull when you submit your full application.

You’ll need to do the following when you apply:

  • Connect at least one checking account to Earnest’s platform to confirm your income. It’s optional to connect other financial accounts, including those for investments and credit cards.
  • Upload a copy of your government-issued photo ID, such as a driver’s license, passport or U.S. green card
  • Upload other documents that Earnest requests, such as a job offer letter or income verification

Teddy Nykiel is a staff writer at NerdWallet, a personal finance website. Email: teddy@nerdwallet.com. Twitter: @teddynykiel.

Updated July 6, 2017.