What Credit Score Do You Need To Refinance Student Loans?

Refinancing your student loans can save you money on interest and lower your monthly payment. But not everyone can qualify. Most student loan refinance lenders require a credit score of at least 650, though borrowers with scores of 720 or higher generally have the best chance of qualifying for a lender’s lowest rates.

If your credit isn’t where you’d like it to be, you still have options. Some lenders consider other factors besides your credit score, and applying with a cosigner could improve your chances of approval.

Here’s what credit score you need to refinance, and some strategies to consider if you don’t have good credit.

Current student loan refinance rates

What credit score do you need to refinance student loans?

Borrowers with excellent credit scores are likely to qualify for a lender’s lowest refinancing rates. Meanwhile, borrowers with credit scores below the mid-600s may struggle to qualify and will likely get stuck with a higher rate.

This table breaks down general refinance eligibility and the likely interest rate tier for different credit scores:

“Every lender sets their own criteria for credit scores required to refinance student loans,” says Robert Farrington, student loan expert and the founder of The College Investor. “Many lenders have minimum scores in the 650 to 680 range, but that may vary.”

Of course, your credit score isn’t the only factor lenders take into account. Someone with a credit score in the 700s may be declined for a refinance loan if they have inconsistent income or a high debt-to-income ratio (DTI). At the same time, a borrower with a score on the low end of the criteria may be approved if the rest of their personal finances are in great shape.

Additionally, while you can usually qualify for a refinance loan with a score in the mid-600s, the best interest rates are often only available to borrowers with scores of at least 720.

What do lenders consider besides your credit score?

While your credit score is an important factor in determining your eligibility for refinancing, lenders also look at other aspects of your financial profile, including:

• Income: A stable income can demonstrate your ability to repay the loan.
• Debt-to-income ratio (DTI): Lenders generally prefer borrowers with a lower DTI, which indicates they can comfortably manage their debt payments.
• Employment history: Consistent employment may signal financial stability and reduce the lender's risk.
• Payment history: A record of making on-time payments can strengthen your application.

How does your credit score affect your refinance rate?

Your credit score determines whether you’ll qualify for a student loan refinance, as well as the rate you’re eligible for. As a general rule, the higher your credit score, the lower the interest rate you’ll qualify for, and vice versa.

Can you refinance student loans with bad credit?

Most lenders require credit scores of 650 or higher to refinance. So, where does that leave you if you have bad credit? 

First, you may still qualify to refinance even if your credit isn’t exactly ideal, though you likely won’t be offered the best rate.

“It’s important to realize that you can refinance your student loan multiple times,” says Farrington. “So, if you can better your rate today, do that. Then continue to improve your credit, and then check your rates again to see if you can get even lower.”

If you can’t qualify with your current credit score, you still have options, including improving your credit before you apply or applying with a cosigner who has strong credit and a steady income. Additionally, if you don’t qualify with most traditional lenders, you may consider working with a lender that specializes in non-prime borrowers (but be prepared to pay a higher interest rate).

How to improve your credit score before refinancing

To improve your chances of being approved for a refinance loan and qualifying for the best rate, work on improving your credit before applying. Here are some strategies that can help:

Make payments on time

Your payment history is the most important piece of your credit score calculation. A single missed payment can cause a drop in your score, while a history of on-time payments will increase your score over time.

Pay down credit card balances

Paying off credit card debt will lower your total debt burden and decrease your credit utilization. An ideal credit utilization rate is below 30%.

Increase your credit limits

While asking for more credit may seem counterintuitive, increasing your existing credit limits can improve your score. By freeing up more credit without increasing your debt balance, you reduce your total credit utilization.

Avoid applying for new credit

Don’t apply for any new loans or credit cards while you’re working on increasing your score. Both a hard inquiry (or credit check) and a new credit account can ding your credit score.

Consider a secured credit card

A credit card is often a valuable tool in improving your credit. If you don’t already have a card or can’t qualify for one, consider a secured card instead, which requires a refundable security deposit that serves as both collateral and your credit limit. These cards are designed to help build your credit.

Become an authorized user

By becoming an authorized user on someone else’s credit card, you can get credit for their positive payment history and low credit utilization. If you become an authorized user, it should be someone whom you trust (and who can trust you) to use the line of credit responsibly. 

What are your options if you can’t refinance right now?

When you’re considering refinancing your student loans but your credit score is too low, you still have some options to make your payments more manageable and save money on interest, either in the short term or the long term. 

“If your credit score isn’t quite where it needs to be to refinance today, don’t get discouraged,” says Bethany Hubert, a financial aid specialist and manager of high school partnerships at the scholarship and financial aid platform Going Merry by Earnest.

“There are steps you can take to strengthen your financial profile,” she adds. “See this time as an opportunity to focus on two key areas: leveraging federal benefits and actively building [your] credit.”

Federal repayment options

Hubert recommends making sure you’re taking advantage of the repayment programs currently at your disposal.

“Income-driven repayment (IDR) plans, for instance, can lower your monthly payment based on your income, making it more manageable,” explains Hubert. “Options like deferment or forbearance can offer short-term relief if you're experiencing financial hardship.”

Once you have your payments under control, you can turn your attention to improving your credit through the strategies outlined above.

Apply with a cosigner

Depending on your situation, you may also be able to refinance with a cosigner, as long as they have good credit.

“Adding someone with a strong financial profile to your application can significantly increase your chances of approval and help you secure a lower interest rate,” says Hubert.

Some lenders offer a cosigner release that lets you remove the cosigner from your loan after a certain number of payments if your credit score has improved. And if you can’t remove your cosigner with a release, consider refinancing again down the road once you qualify on your own.