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Can I refinance student loans with bad credit?

Your options might be limited without a cosigner.


If you have bad credit, you might not be able to take advantage of all of the benefits that come with refinancing your student loans. But it’s still possible to save on interest, get out of debt faster or switch up your servicer. Especially if you apply with a cosigner or have federal loans.

4 ways to refinance student loans with bad credit

Your options for student loan refinancing are limited if you have bad credit, since most lenders require good to excellent credit. And you might have a particularly hard time refinancing with another lender if you’ve fallen behind on repayments. But there are a few ways around those high credit requirements.

1. Apply with a cosigner

The easiest way to get around high credit requirements is to apply with a cosigner. Most student loan refinancing companies accept cosigners and will consider their credit and income instead of yours when you apply.

Many also offer cosigner release, which allows you to eventually take your cosigner off your loan. You can usually apply after a few years of on-time repayments, provided you can meet the credit and income requirements on your own.

2. Consolidate your federal loans

A Direct Consolidation Loan allows you to combine all of your federal loans under one new student loan, also issued by the Department of Education (DoE).

While you won’t be able to change your interest rate, consolidating has two main benefits: You can switch your servicer and potentially access more repayment options with longer loan terms. Longer loan terms can give you more affordable repayments and therefore the financial flexibility to build your credit.

3. Find a lender with no or low credit requirements

Some student loan refinancing companies don’t rely on credit scores as much as other factors. For example, some lenders consider your level of education and employment history alongside the standard income, monthly debt obligations and credit scores that lenders typically take into account.

4. Consider a CDFI

Community development financial institutions (CDFIs) are local banks, credit unions and other nonprofit lenders that are often willing to work with bad-credit borrowers. CDFIs have a social mission that usually translates into more favorable rates and terms than you’d find with a typical lender.

The 5 best student loan refinancing offers for bad credit

Compare student loan refinancing providers

Data indicated here is updated regularly
Name Product Min. Credit Score Max. Loan Amount APR
Discover Private Consolidation Loan
Good to excellent credit
2.80% to 12.49%
Splash Financial Student Loan Refinancing
Starting at 1.89%
Save on your student loans with this market-leading newcomer.
Credible Student Loan Refinancing
Good to excellent credit
1.99% to 9.24%
Get prequalified offers from top student loan refinancing providers in one place.
Education Loan Finance Student Loan Refinancing
2.39% to 5.99%
Lower your student debt costs with manageable payments, affordable rates and flexible terms.
Earnest Student Loan Refinancing
1.99% to 5.64%
Get a tailored interest rate and repayment plan with no hidden fees.
SoFi Student Loan Refinancing Variable Rate (with Autopay)
Full balance of your qualified education loans
2.25% to 6.09%
A leader in student loan refinancing, SoFi can help you refinance your loans and pay them off sooner.
Purefy Student Loan Refinancing (Variable Rate)
2.27% to 7.49%
Refinance all types of student loans — including federal and parent PLUS loans.

Compare up to 4 providers

How to up your chances of approval without a cosigner

Refinancing with bad credit and no cosigner can make getting a competitive rate tricky. If you want to refinance for a better deal, consider taking these steps before you apply.

Improve your credit

There are several ways to improve your credit score, including:

  • Credit-builder loans. These short-term loans are meant to improve your credit score by diversifying your credit portfolio and adding on-time repayments to your credit report.
  • Secured credit cards. Credit cards backed by a security deposit are widely available to all credit types and can improve your credit the same way a credit-builder loan can, while also lowering your credit utilization ratio.

Pay off other debts

Paying off your debts lowers your credit utilization ratio, one of the most important factors in your credit score. Coming up with a systematic plan to make extra repayments on your loans or credit cards can help you improve your credit score by also building your record of on-time repayments.

Take on a side gig

Your credit score isn’t the only factor lenders consider when you refinance. They also pay close attention to your debt-to-income (DTI) ratio and your monthly income to make sure you’re able to afford repayments.

Adding another income source from a side gig can boost both, making it easier to qualify for a more favorable deal.
What’s a good DTI to qualify for student loan refinancing?

Sign up for credit counseling

When you’re really struggling with debt, scheduling an appointment with a credit counseling agency might be the best way to figure out your next steps. You can find a government-approved credit counseling agency through the Department of Justice’s website.

3 alternatives to student loan refinancing

Student loan refinancing isn’t the only way to change up your repayments or servicer. You might want to also consider these alternatives when you have bad credit.

1. Switch your repayment plan

If you have federal loans and want to reduce your monthly repayments, you might want to consider switching up your student loan repayment plan.

You might be able to stick with the same plan and lengthen the term. Or consider signing up for income-driven repayments if your loans are eligible, which are based on how much you make each month.

2. Negotiate with your servicer

Private student loan holders might have more flexibility on their repayment plans than they think. Especially if your financial situation has changed since you first took out your loans.

Some servicers might be willing to offer income-driven repayments. And others might even let you renegotiate the terms or interest rates of your loans.

3. Go into deferment or forbearance

Facing a temporary financial roadblock like losing your job or returning to school? You can likely qualify for deferment or forbearance, especially if you have federal loans.

This allows you to temporarily pause repayments without changing the terms of your loan. If you have bad credit, deferment or forbearance might be a more manageable solution than refinancing.

Bottom line

Refinancing your student loans when you have bad credit isn’t impossible. But you might have trouble qualifying for a more competitive rate or term without a cosigner. Instead, you might want to take steps to improve your credit or consider alternatives.

You can learn more about how student loan refinancing works by reading our guide.

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