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My wife is holding a 12k federal loan at 4% and a private loan 9k that is currently at 9%.
I was curious what options there are available to her to get that 9% loan refinanced to a better term.
She has told be basically our options are limited on the private loan to just personal loans which even with 800+ credit score i seem to only find loans in the same 8-9% range.
Are there other options available to either A combine these two to one loan that still under 4% or B get the higher rate one down lower?
My only thought and I dont really wanna do this is to refinance our home loan to pull out enough to pay that high interest loan off. But this seems like an expensive route to go just to pay off the one loan.
My last option and the one I am leaning towards if we cant find a way to refinance this loan to a lower rate would be to cut back on our 401k next year and use that to go really hard at the bill and pay it off by the end of the year.
On the federal side my s/o just took a look at refinancing to save a few bucks. Rate quoted on a variable rate loan from SOFI was 4.2%. Likely not taking the offer, not low enough with a variable rate.
Yes I like the last option...stop all spending and pay off the loan ASAP. Have a garage sale or use craigslist. You can drop the investing to the company match or just stop all together. IMO its better than taking out a loan. How long would it take to pay it off?
We need more information like your monthly income after taxes, other debt balances with interest rates, investment contributions, and general expenditures. However without those figures present, I would give you general advice to refinance the private loan to an outfit like SoFi and focus on paying that off first. The federal loan should be at a fixed rate and I'll bet it's at a rate close to your mortgage…both of which are tax deductible if you're under that $160K combined annual income.
Make sure there are no prepayment penalties and that any extra payment you send are to pay down the principal of the balance and not to advance the due date. This could save you a couple thousand dollars in interest payments over the term of the loan. I would not advise consolidating the two loans as keeping them separate gives you more flexibility in repayment options.
My wife is holding a 12k federal loan at 4% and a private loan 9k that is currently at 9%.
I was curious what options there are available to her to get that 9% loan refinanced to a better term.
She has told be basically our options are limited on the private loan to just personal loans which even with 800+ credit score i seem to only find loans in the same 8-9% range.
Are there other options available to either A combine these two to one loan that still under 4% or B get the higher rate one down lower?
My only thought and I dont really wanna do this is to refinance our home loan to pull out enough to pay that high interest loan off. But this seems like an expensive route to go just to pay off the one loan.
My last option and the one I am leaning towards if we cant find a way to refinance this loan to a lower rate would be to cut back on our 401k next year and use that to go really hard at the bill and pay it off by the end of the year.
Thought?
How much can you reduce the 401k contribution without losing any employer match? If not quite $9k, maybe you can make up the gap by selling old stuff and transferring to a 0% CC. Or at a higher income, just buckle down for a few frugal months and knock it out.
We need more information like your monthly income after taxes, other debt balances with interest rates, investment contributions, and general expenditures. However without those figures present, I would give you general advice to refinance the private loan to an outfit like SoFi and focus on paying that off first. The federal loan should be at a fixed rate and I'll bet it's at a rate close to your mortgage…both of which are tax deductible if you're under that $160K combined annual income.
Make sure there are no prepayment penalties and that any extra payment you send are to pay down the principal of the balance and not to advance the due date. This could save you a couple thousand dollars in interest payments over the term of the loan. I would not advise consolidating the two loans as keeping them separate gives you more flexibility in repayment options.
We were under that threshold until last year. Last year combined we were over. My income tripled last year after starting my own business and while slightly down this year we should be in that ballpark(150k-170k) We spent the last 1.5 years paying down cc and fully funding our 401k and my Simple and IRA. Now our last debt is her student loans.
I looked at the SoFi I dont think she can qualify for it. She went to Sanford Brown and I dont beleive they are a 4 year accredited school.
It cant hurt to contact them and see though.
We were under that threshold until last year. Last year combined we were over. My income tripled last year after starting my own business and while slightly down this year we should be in that ballpark(150k-170k) We spent the last 1.5 years paying down cc and fully funding our 401k and my Simple and IRA. Now our last debt is her student loans.
I looked at the SoFi I dont think she can qualify for it. She went to Sanford Brown and I dont beleive they are a 4 year accredited school.
It cant hurt to contact them and see though.
Thanks
You make 150K and you are worried about this...pay that **** off.
Yes but its not like I've been making 150k for years this is a recent bump in pay. After fully funding both our retirements last year and should this year along with paying off all debt except for house and student loans. We also worked on building up a emergency fund.
Now this is out final step which we are addressing now.
Since my business is new and very small I think I need a larger emergency fund then most. So that has been our focus.
I dont want to touch the emergency fund at all.
I have my wife contacting the Sofi today to find out if there are options available for us.
I would pay the 9K loan off in 3 months - 3K a month...stop doing all that other stuff for 3 months.
Therefore the interest doesnt really matter that much.
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