Citizens Bank Refinance Education Loans

[Anonymous]

Well based on my income when it was like 75k with govt loans they wanted payments like 800 - 900 from me a month then it just kept goin up - im payin 1300 now with citizens but just got done with year one repayment and principal reduced 6k in last 12 mos ... doesn't sound like much but this is the first time balance went down since i graduated in 2012 ... i have 9 yrs left with citizens and done .. not 20 like the forgiveness plan ... my credit was shaky like 690ish when I did citizens loan, i will refinance again with them this year since im now around 720ish scores and get my rate/payment reduced. ...

[Anonymous]

That sounds like you were on a graduated repayment plan - not the old IBR, or the new PAYE/REPAYE. My gross income is over $65k/yr and my monthly payment is $27/mo under PAYE. If you've already refinanced them though, then it doesn't really matter anymore

Citizen's is a good company - I just refinanced my 2nd private student loan with them, because I could finally get an interest rate lower than the rate on that loan. I found too when I talked to them they use the same credit report for 90 days and since my existing loan with them is at a 1.2% higher rate than what they're giving me now, I can also refinance that loan to the new rate with no additional credit hit - and lower that payment by $55/mo. They just saved me $75/mo in payments, so I'm happy with them  

They're also a little more lenient with their lending - my federal loans on IBR keep me from qualifying with SoFi and DRB which do give better rates than Citizens. SoFi and DRB fully amortize loans on IBR to determine what the full payment would be for calculating DTI - Citizens Bank uses your current and actual Fed Loan payment when calculating DTI. They also counted my rental income on my duplex the same way a bank would for a mortgage, where SoFi and DRB wouldn't consider it. 

[Anonymous]

@Newbie01 ^^^ thx for sharing all the good information - funny my situation was almost like yours ... I also couldn't qualify with Sofi or DRB ... thought my credit wasn't high enough but if they fully amortized my over $110k in student loan debt is likely that was my issue as well - Dti .... Also as far as my govt loans I actually was on the IBR plan ... it was kike 450-500 after me appealing at fighting them and still was not lowering my balance it was increasing and it drove me nuts!!! Now I cant lie if I only had to pay 27 or $50 heck less than a $100, i would have glady paid that for my 20 years then let them forgive my balance

[Anonymous]

I've already decided when my IBR payment goes over $250 I will start looking for refinance privately - but for now, keeping my AGI low on my taxes, to keep that payment low is good incentive to contribute more to my retirement funds - that is the only reason I'm able to get my AGI low enough to get that low of a payment at my income. But I figure if I'm going to pay out the money either way - student loans or my retirement, might as well plan for retirement. At the end of the 20 years I will have paid in interest 3x more than what I actually borrowed, plus they'll collect taxes on the forgiven amount, so they're still going to make a butt load of money off me. 

[Anonymous]

@newbie01 your smart ... with that 401k thing ... i know other people who contribute half of their income to retirement to avoid other stuff as well ... smart but it depends on stability as well ... one would assume like the others I know that you have your home and cars and kids are set ... because I want a bigger home in the next 5yrs or so ... have a kid in 8th grade and one 19 ... i still have to finance stuff ... thats when the contributions to 401 become an issue ... I contribute 10 percent now and thinking of increasing that to 15 percent ...anything above that and I wouldn't be able to qualify for large purchases due to the dti or that all so important cash flow ... and yes that student loan payment with citizens is my largest bill ... thats crazy huh ... they preach n teach everyone go to school but Its a catch 22 to the education game .... its like a scheme to me ... dont get me wrong wouldn't trade my degrees for anything and no one can take them from me but dam .. im at the same job for 17yrs went from secretary to vp and six figures without them even knowing I have any degrees ... its who u know .. we all know that .. now that were adults

[Anonymous]

Contributions to your 401k or any retirement account, don't lower your income for DTI calculations - DTI is figured based on your gross income. 

I have a 12 yr old daughter, so I get it - like I said the money I put in retirement accounts would be gone one way or another - if not to retirement then to SL payments. I'm just choosing to pay one and not the other. Plus, if there is a major emergency I can withdrawal the money in my HSA (for a penalty) and take out a 401k loan, so it also gives added security that way. If it was going to student loans, it would just be gone. This way I still have access to most of it needed. 

I agree with it being like a scheme too - higher education changed when the government made it so anyone could get a student loan. That's when all the for-profit schools started popping up. I did my undergrad right - 1st 2 years worth of classes at community college for cheap, and last 2 years worth at university. Since the state I was in capped out full time tuition and it didn't matter how many classes you took, I took as many as I could, and finished early, and finished cheap. I did graduate school wrong though - that where I screwed myself and racked up the debt.