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MEFA Review: Student Loan Refinancing and Private Student Loans

MEFA offers student loan refinancing to borrowers whether they completed their degree or not and private student loans with fixed rates.

Matt Carter Matt Carter Updated December 18, 2019

Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, whom we will always identify, all opinions are our own. Credible Operations, Inc. NMLS # 1681276, is referred to here as "Credible."

Best if:

  • You attended a public or nonprofit university
  • Your credit is good
  • You didn’t complete your degree

The Massachusetts Educational Financing Authority (MEFA) is a not-for-profit lender that provides student loans and student loan refinancing to borrowers nationwide. MEFA is known for offering competitive rates to qualified borrowers and for refinancing both private and federal student loans.

In this post:

  • MEFA student loan refinancing
  • MEFA private student loans

MEFA refinancing interest rates and loan details

If you’re interested in student loan refinancing, MEFA offers a choice of a fixed- or variable-rate loan, with repayment terms ranging from seven to 15 years. There are no autopay or other interest rate discounts, but MEFA’s rates can still be competitive. MEFA says its customers reduce their interest rate by an average of 24% when they refinance student loans.

Rates from (APR)Fixed: 3.05%+
Variable: 3.05%+
Loan amounts$10,000 up to the total amount of qualified education debt
Loan terms7, 10, 15 years
Loan typesAny private or federal student loans taken out to attend a nonprofit college or university
Min. credit score670
Min. income$24,000
ResidencyU.S. citizen or permanent resident
Transfer parent loan to child?No
Cosigner releaseNot offered
Death discharge availableYes, cosigner not obligated if borrower dies
Fees
  • No application, origination, or disbursement fees

  • No prepayment penalty
Key benefitsCompetitive rates
EducationDegree not required
Loan servicerAmerican Education Services (AES)
Best if
  • You attended a public or nonprofit university

  • You have good credit

  • You didn't earn a degree

All APRs reflect autopay and loyalty discounts where available

MEFA student loan refinancing review

MEFA will refinance private and federal student loans that you took out in your own name, even if you didn’t earn your degree. But MEFA won’t refinance loans that were taken out to attend a for-profit school, and you can’t refinance PLUS loans that your parents took out on your behalf.

Also, if you do need a cosigner, keep in mind that there’s no option to have them released from their obligation before you’re done paying off your loan.

MEFA is known for offering low rates to borrowers with good credit — seven out of 10 refinancing customers have a credit score of 740 or better. An analysis of a pool of 2,700 recent loans totalling $168 million reveals the characteristics of MEFA’s typical student loan refinancing customer:

  • Average FICO score: 763
  • Average income: $104,128
  • Average amount refinanced: $62,243
  • Average interest rate (fixed-rate loans): 5.70%
  • Percentage who refinanced with a cosigner: 24.1%

How to qualify

To qualify for student loan refinancing with MEFA, you or your cosigner will need:

  • A credit score of at least 670
  • Income of at least $24,000

In addition, you must be:

  • A U.S. citizen or permanent resident
  • The borrower on all loans being refinanced (you cannot refinance a PLUS loan taken out by your parents, for example)
  • Refinancing debt taken on to attend a public or nonprofit school — debt taken on to attend a for-profit school is not eligible
  • Free of any history of default on an education loan, with no delinquencies on education debt in the past 12 months
  • Free of bankruptcy or foreclosure in the past five years

Repayment

MEFA offers three repayment terms — 7, 10, or 15 years — which helps you select a loan that best matches your monthly budget.

MEFA’s loan servicer is American Education Services (AES). You can make payments to AES online, by phone, or mail. You can also set up automatic direct debit payments from a bank account. Unlike some other lenders, you won’t get an interest rate discount for authorizing automatic payments — but you don’t have to pay extra if you want to mail a check.

If you run into unexpected financial difficulties, you can apply for a modified payment plan that allows you to make interest-only or reduced monthly payments for up to 48 months. MEFA says it may grant forbearance if you’re called up on active duty military service or during bankruptcy.

How MEFA compares to other lenders

 mefa student loan refinancing reviewcollege ave student loan refinancing reviewcitizens bank student loan refinancing review
Rates from (APR)Fixed:
3.05%+

Variable:
3.05%+
Fixed:
3.34%+2

Variable:
3.24%+2
Fixed:
2.97%+¹

Variable:
1.99%+¹
Loan repayment terms (Years)7, 10, 1516 options from 5 to 20 years5, 7, 10, 15, 20
Loan amount$10,000 to amount of qualified education debt$5,000 to $300,000$10,000 to $500,000
(depending on level of education)
Cosigner release?Not offered for refinancingNot offered for refinancingYes, applications accepted after 36 months of consecutive payments
Transfer parent loan to child?NoNoNo
Loan servicerAmerican Education Services (AES)University Account Service (UAS)Firstmark Services
Best forRefinancing debt taken on to attend a public or nonprofit college or universityGraduates seeking flexible loan termsRefinancing large loan balances

All APRs reflect autopay and loyalty discounts where available | 1Citizens Bank Disclosures | 2College Ave Disclosures | 3 ELFI Disclosures | 4INvestEd Disclosures | 5SoFi Disclosures

How to refinance student loans with MEFA

MEFA can be a great match if you’ve got good credit and are looking to refinance private or federal student loans taken out to attend a public or non-profit university. But keep in mind that many lenders offer student loan refinancing, and checking rates with multiple lenders helps you find the best deal.

With Credible, it’s easy to compare rates from some of the best companies to refinance with, including MEFA. You fill out just one form to request prequalified rates, and checking rates won’t affect your credit.

Find out if refinancing is right for you

  • Compare actual rates, not ballpark estimates – Unlock rates from multiple lenders with no impact on your credit score
  • Won’t impact credit score – Checking rates on Credible takes about 2 minutes and won’t impact your credit score
  • Data privacy – We don’t sell your information, so you won’t get calls or emails from multiple lenders

See Your Refinancing Options
Credible is 100% free!

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MEFA private student loans interest rates and loan details

For students looking to close gaps in their college funding, MEFA offers private student loans with fixed rates that can be competitive with federal PLUS loans.

Undergraduates have a choice of a 10- or 15-year repayment terms. You can defer payments for up to 60 months while attending school or make interest-only or full monthly payments while you’re still enrolled.

Fixed rates3.75%+
Loan minimum
  • $2,000 for private school
  • $1,500 for public school
Loan maximumUp to certified cost of attendance
(minus other financial aid received)
Loan terms
  • 10 or 15 years (undergraduate)

  • 15 years (graduate student)
Min. credit score670
Min. income$25,750
ResidencyU.S. citizen or permanent resident
FeesNo application, origination, or disbursement fees
Prepayment penaltyNone
Key benefitsDefer payments for up to 60 months
EnrollmentMust be enrolled at least half time in degree-granting public or nonprofit college or university
Cosigner release
  • Applications accepted after 48 consecutive on-time payments

  • Only offered on 15-year loans to undergraduates who are deferring payments
Repayment plansDefer payments until 6 months after leaving school, or:
  • Make interest-only payments while still in school

  • Begin making full monthly payments immediately
Loan servicerAmerican Education Services (AES)
Best if
  • You're attending a public or nonprofit university

  • You've hit your limits on more affordable federal loans

  • You have a cosigner with good credit

Lowest APRs reflect autopay, loyalty, and interest-only repayment discounts where available

MEFA private student loans review

Although MEFA is a nonprofit, state-chartered lender based in Massachusetts, its private student loans offer competitive rates to families nationwide.

Since most students won’t have the credit and earnings history needed to qualify for a loan on their own, 98% of MEFA’s private student loans are cosigned by a parent or other “co-borrower.”

The co-borrower (or cosigner) is responsible for taking over payments if the student can’t make them. MEFA offers cosigner release after 48 consecutive on-time payments — but only on 15-year loans to undergraduates who are deferring payment while in school.

How to qualify

To qualify for a private student loan from MEFA, you or your cosigner will need:

  • A credit score of at least 670 (710 if payments are fully deferred)
  • Income equal to at least the federal poverty guideline for a family of four ($25,750 in 2019)

In addition, you must be:

  • A U.S. citizen or permanent resident
  • Enrolled at least half-time at an eligible nonprofit school (students attending for-profit schools are not eligible)

Learn More: How to Apply for a Student Loan

Repayment

Undergraduates can choose a loan with a 10- or 15-year repayment term and have a choice of three repayment plans:

  1. Defer monthly payments until 6 months after leaving school (most expensive option)
  2. Make interest-only payments while still in school (reduces total interest charges)
  3. Begin making full monthly payments immediately (cheapest option)

All loans to graduate students have 15-year repayment terms, and borrowers can either defer payments or make interest-only payments while still in school.

About half of all MEFA borrowers defer payments while still in school, while one in three choose to start making full monthly payments right away. The remaining 15% make interest-only payments while enrolled.

How MEFA compares to other lenders

mefa private student loans reviewcollege ave private student loans reviewcitizens bank private student loan review
Rates from (APR)Fixed:
3.75%+

Variable:
N/A
Fixed:
3.49%+2,3

Variable:
1.04%+2,3
Fixed:
3.99%+1

Variable:
1.22%+1
Loan repayment terms (Years)10, 15
(depending on degree type)
5, 8, 10, 15, 205, 10, 15
Loan amount$1,500 up to 100% of certified cost of attendance
($2,000 minimum for private schools)
$1,000 up to 100% of cost of attendance$1,000 minimum, up to school's cost of attendance
(aggregate limits apply)
Cosigner release?On some loans, applications accepted after 48 consecutive on-time paymentsYes, applications accepted after more than half of the scheduled repayment period has elapsed
  • Yes, applications accepted after 36 on-time payments
  • Cosigner release not available for parent student loan
Loan servicerAmerican Education Services (AES)University Account Service (UAS)University Account Service (UAS)
Best forStudents attending public or nonprofit universitiesStudents and parents seeking flexible loan termsProfessional students (law, medicine, and MBA)

Lowest APRs reflect autopay, loyalty, and interest-only repayment discounts where available | 1Citizens Bank Disclosures | 2,3College Ave Disclosures | 7EDvestinU Disclosures | 8INvestEd Disclosures | 9Sallie Mae Disclosures

How to take out student loans with MEFA

MEFA can be a reliable source of funding for students and families who have hit their limits on the most affordable federal student loans. This is because they offer rates that can be competitive with federal PLUS loans.

But before taking out private student loans, it’s a good idea to compare rates from several lenders. Unlike federal student loans, the rates you’re offered can vary by lender.

Credible makes it easy to request personalized rates from some of the best private student loan companies, including MEFA. It takes about three minutes to submit your request, and checking rates does not affect your credit.

Compare student loan rates from top lenders

  • Multiple lenders compete to get you the best rate
  • Get actual rates, not estimated ones
  • Finance almost any degree

See Your Rates
Checking rates will not affect your credit

Trustpilot

How MEFA can improve

While MEFA has provided great rates on student loans and student loan refinancing to many borrowers over the years, it could improve by:

  • Offering cosigner release for student loan refinancing
  • Serving students who attended for-profit colleges
  • Offering a broader choice of repayment terms

Keep Reading: Best Ways to Pay for College

 
The company above is one of Credible’s approved partner lenders. Because they compete for your business through Credible, you can request rates from them by filling out a single form. Then, you can compare your available options side-by-side. Requesting rates is free, doesn’t affect your credit score, and your personal information is not shared with our partner lenders unless you see an option you like. Credible receives compensation if you close a loan with one of our partner lenders. The rates you receive and the fees you pay (if any) are not impacted by this compensation.
About the author
Matt Carter
Matt Carter

Matt Carter is a Credible expert on student loans. Analysis pieces he’s contributed to have been featured by CNBC, CNN Money, USA Today, The New York Times, The Wall Street Journal and The Washington Post.

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Discover Student Loans Disclosure

The interest rates depicted on Credible represent the APR. The fixed interest rate is set at the time of application and does not change during the life of the loan. The variable interest rate is calculated based on the 3-Month LIBOR index plus the applicable Margin percentage. The margin is based on your credit evaluation at the time of application and does not change. For variable interest rate loans, the 3-Month LIBOR is 2.375% as of July 1, 2018. Discover Student Loans will adjust the rate quarterly on each January 1, April 1, July 1 and October 1 (the “interest rate change date”), based on the 3-Month LIBOR Index, published in the Money Rates section of The Wall Street Journal 15 days prior to the interest rate change date, rounded up to the nearest one-eighth of one percent (0.125% or 0.00125). This may cause the monthly payments to increase, the number of payments to increase or both. Please visit http://www.discover.com/student-loans/interest-rates.html for more information about interest rates.

Citizens Bank Disclosures

Student Loan Rate Disclosure

Variable rate, based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of July 1, 2018, the one-month LIBOR rate is 2.10%. Variable interest rates range from 4.07%-12.04% (4.07%-11.94% APR) and will fluctuate over the term of the loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a cosigner. Fixed interest rates range from 5.25%-12.19% (5.25% – 12.09% APR) based on applicable terms, level of degree earned and presence of a cosigner. Lowest rates shown requires application with a cosigner, are for eligible applicants, require a 5-year repayment term, borrower making scheduled payments while in school and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change. Please note: Due to federal regulations, Citizens Bank is required to provide every potential borrower with disclosure information before they apply for a private student loan. The borrower will be presented with an Application Disclosure and an Approval Disclosure within the application process before they accept the terms and conditions of the loan.

Citizens Bank - Refi - Disclosures

Education Refinance Loan Rate Disclosure:

Variable rate, based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of July 1, 2018, the one-month LIBOR rate is 2.10%. Variable interest rates range from 2.75%-8.20% (2.75%-8.20% APR) and will fluctuate over the term of the borrower’s loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a cosigner. Fixed interest rates range from 3.50%-8.69% (3.50% – 8.69% APR) based on applicable terms, level of degree earned and presence of a cosigner. Lowest rates shown require application with a cosigner, are for eligible, creditworthy applicants with a graduate level degree, require a 5-year repayment term and include our Loyalty discount and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty and Automatic Payment Discount disclosures. The maximum variable rate on the Education Refinance Loan is the greater of 21.00% or Prime Rate plus 9.00%. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change. Please note: Due to federal regulations, Citizens Bank is required to provide every potential borrower with disclosure information before they apply for a private student loan. The borrower will be presented with an Application Disclosure and an Approval Disclosure within the application process before they accept the terms and conditions of their loan.