How To Refinance Student Loans With Bad Credit

Student loan refinancing replaces one or more existing student loans with a new private loan. Private lenders set their own qualifications, and your credit plays a significant role. Most require a minimum credit score in the mid-600s, but they also weigh your income, employment history, and debt-to-income ratio. 

With a FICO score below 580, applying with a cosigner may give you your best chance of qualifying for refinancing. In the last 12 months, approximately 86% of student loan refinance applications with a cosigner were approved, according to Credible marketplace data. Other options include finding a lender that looks past your score, or spending a few months rebuilding your credit before you apply.

This guide explains how to refinance student loans with bad credit and what steps you can take to improve your chances of approval.

Compare student loan refinance rates

Can you refinance student loans with bad credit?

Your credit score plays an important role in qualifying for a refinance loan, but that doesn’t mean it’s impossible to refinance if your credit isn’t perfect. A lot depends on the lender you choose.

“Different lenders will have different criteria for underwriting," explains Jack Wang, a wealth adviser specializing in college financial aid at Innovative Advisory Group. “Generally, a borrower needs a higher credit score to be approved, but some lenders will consider a lower credit score, especially if the borrower has a really good, low, debt-to-income ratio.”

What credit score do I need to refinance student loans?

You typically need good credit to qualify for student loan refinancing. A good credit score is generally considered 670 or higher on the FICO scale, though each lender sets its own standards.

“Most lenders want you to have a credit score in the mid-600s or higher,” says Domenick D'Andrea, financial adviser and founder of DanDarah Wealth Management.

You may still qualify with a lower credit score, but you likely won't receive a lower rate than you're already paying.

“It's important to remember that your new rate could be higher than the original loan rate,” warns Steve Azoury, chartered financial consultant (ChFC) and owner of Azoury Financial.

If you can't qualify for a loan with a lower interest rate than your current debt, it's typically not worth refinancing, as doing so would make your loan more expensive.

Learn More: What Credit Score Is Needed To Refinance Student Loans?

How to qualify for refinancing with bad credit

The most effective way to qualify for student loan refinancing with bad credit is to apply with a cosigner who has strong credit. A cosigner's financial history can help you meet a lender's requirements and qualify for a lower interest rate.

For borrowers with the lowest credit score, adding a cosigner can make the biggest difference. Borrowers with credit scores below 599 who used the Credible marketplace to refinance student loans had an average prequalified rate of 5.90% with a cosigner, compared to 8.74% without one. That’s a difference of almost three percentage points. As credit scores rise, the advantage is smaller.

If you don't have a cosigner, look for lenders that allow refinancing without a cosigner, even for applicants with low credit. These lenders often review your overall financial picture, not just your credit score.

“Lenders also will look at your employment history and income,” explains D'Andrea. “They will use these factors to see if they believe that you are a good credit risk. Lenders may also look at your savings accounts to see if you have an emergency fund to cover any unexpected expenses in the hope that you don't miss any payments.”

You can also work on improving your credit before applying. Pay down existing debt to lower your credit utilization ratio, make payments on time to build a positive history, ask creditors to consider removing an isolated late payment as a goodwill adjustment, and avoid opening multiple new credit accounts at once.

Lenders that may work with low-credit borrowers

When you're looking for student loans with bad credit, you may have fewer options. Prequalifying with multiple lenders can help you see where you stand. This process lets you check your eligibility and potential rates without submitting a formal loan application or affecting your credit score. 

Here are the minimum credit scores of some private lenders:

Alternatives if you're denied refinancing

If you're denied a student loan refinance, there are still other ways to help manage your debt:

• Apply for a Direct Consolidation Loan: If you have federal student loans, consolidation combines them into one federal loan without a credit check, while keeping access to federal borrower benefits. Depending on your loan balance, you could extend your repayment term and lower your monthly payments, but a longer term usually means paying more total interest. Direct Consolidation Loans taken out on or after July 1, 2026, are eligible only for RAP and the Tiered Standard plan. Consolidating can also reset progress you've already made toward forgiveness, so check where you stand before you apply.
• Switch to an income-driven repayment (IDR) plan: An IDR plan adjusts your federal student loan payments to a percentage of your income and could lead to loan forgiveness after a period of repayment, but your options depend on when you borrowed. For loans disbursed on or after July 1, 2026, RAP is the only income-driven option, while older loans can keep access to existing plans until July 1, 2028.
• Consider a home equity loan: If you own a home, you may be able to borrow against your equity to pay off student debt. Because these loans are secured by your home, they can be easier to qualify for, but they carry a risk of foreclosure if you fall behind on payments.
• Contact your lender if you're struggling to afford payments: Some lenders offer forbearance options or may be willing to work with you to find other solutions during temporary financial hardship. Keep in mind that pausing payments can make your loans more expensive over time, as interest continues to accrue.
• Work on improving your credit: If none of these options fit, you may need to work on building your credit before applying for student loan refinancing.