Navient Loan Consolidation: Understanding Potential Charges And Fees

Navient is a student loan servicer that offers refinancing options for borrowers looking to consolidate their student loans. Consolidating loans can help simplify repayment by combining multiple loans into a single loan with a potentially lower interest rate and monthly payment. However, it is important to note that Navient does not directly consolidate federal or private student loans but services loans consolidated through other means. For federal loans, borrowers can consolidate through the Federal Direct Consolidation Loan program at StudentAid.gov, while private loans can be consolidated through refinancing with Navient's partners or other private lenders. While consolidating loans can provide benefits, it is crucial to carefully consider the potential loss of federal benefits, such as loan forgiveness programs and income-driven repayment plans. Additionally, borrowers should be cautious about accumulating new debt and be aware of potential fees associated with consolidation loans.

Navient's loan consolidation fees

Navient does not directly consolidate federal or private student loans but services loans consolidated through other means. Federal Navient loans can be consolidated through the Federal Direct Consolidation Loan program at StudentAid.gov. For private Navient loans, consolidation options include refinancing through Navient's partners (Earnest and NaviRefi) or other private lenders.

Navient's role is primarily as a loan servicer, whether you have federal or private loans. For any consolidation or refinancing, you’ll need to work with the Department of Education (for federal loans) or a private lender (for private loans).

Consolidation can simplify repayment and potentially lower monthly payments but may increase the overall interest paid over the life of the loan. Consolidating federal loans may reset progress toward loan forgiveness and cause a loss of certain borrower benefits. Navient loan consolidation combines multiple student loans into a single loan, simplifying repayment.

There are no origination fees with NaviRefi. However, some lenders, including banks, credit unions, or online lenders, charge origination fees at the outset of the loan, which can add to its cost. Additionally, certain loans may have prepayment penalties if you choose to pay off the loan early.

Federal loan consolidation

Navient does not directly consolidate federal or private student loans but services loans consolidated through other means. Federal Navient loans can be consolidated through the Federal Direct Consolidation Loan program at StudentAid.gov. Consolidating federal loans may reset progress toward loan forgiveness and cause the loss of certain borrower benefits.

For private Navient loans, consolidation options include refinancing through Navient's partners (Earnest and NaviRefi) or other private lenders. Consolidation can simplify repayment and potentially lower monthly payments but may increase the overall interest paid over the life of the loan.

If you want to consolidate your Navient student loans, you can start the process by applying through the portal provided by the Department of Education. The application usually takes less than half an hour to complete. However, the entire process can take several weeks or even months before the Department of Education finalizes everything.

It is important to note that refinancing private loans differs from federal loan consolidation. Federal loan consolidation is done through the federal government for federal student loans only. The interest rate for a Direct Consolidation Loan is equal to a weighted average of the interest rates on your federal student loans. Consolidating federal loans may cause you to lose access to benefits such as income-driven repayment plans and student loan forgiveness programs.

NaviRefi consolidation loans are private loans, so consolidating federal loans with Navient will result in the loss of federal benefits. Additionally, if you have already made qualifying payments towards PSLF, you will lose credit for them and will restart at zero eligible payments after consolidating. Therefore, it may be better to avoid federal consolidation if you have already made a significant number of eligible payments.

Private loan consolidation

• Lower interest rates: You may be able to find a new lender who offers a lower interest rate on your loan, which can save you money over time.
• Simplified repayment: Consolidating multiple private loans into one can make it easier to manage your debt and lower your monthly payments.
• Access to better terms: Refinancing can provide you with more flexible repayment terms that fit your budget.

However, there are also some potential drawbacks to consider. For example, consolidating your private loans may:

• Increase the overall interest paid: While you may secure a lower interest rate, consolidating your loans may extend the repayment period, resulting in more interest paid over the life of the loan.
• Affect your credit score: Taking out a new loan and closing old accounts can impact your credit score, so it's important to consider the potential credit implications.
• Result in fees: Some lenders may charge origination or prepayment fees, so be sure to carefully review the loan terms and associated costs.

Additionally, if you're consolidating federal and private loans together, you may lose access to federal benefits, such as student loan forgiveness programs and income-driven repayment plans. Therefore, it's crucial to carefully evaluate your options and understand the potential consequences before proceeding with private loan consolidation.

Consolidation through NaviRefi

While Navient does not directly consolidate federal or private student loans, it does offer a refinancing program called NaviRefi. NaviRefi is a private loan that allows borrowers to refinance multiple federal or private student loan payments into a single new loan. Consolidation through NaviRefi can simplify repayment and potentially lower monthly payments, but it may not be the best option for everyone.

Terms and Eligibility Criteria

NaviRefi borrowers can refinance from $5,001 to $500,000 in student loan debt, with loan terms ranging from five to 20 years. However, California borrowers have a minimum loan amount of $10,001. NaviRefi offers both fixed-interest and variable-rate loans in most states, but it is not currently available to borrowers in Nevada. To be eligible for refinancing, loans must be in repayment or within the grace period.

Application Process

Applicants can receive a rate quote from Navient in as little as three minutes. If approved, the new lender will pay off the borrower's Navient loans, and the borrower will receive a billing statement from Navient. Until then, borrowers must continue to pay their existing loans according to schedule. To make the first payment, borrowers can navigate to the NaviRefi website, log in, and register. After setting up their account, they can select "Make a Payment" to add their bank account information. It is important to note that NaviRefi does not accept credit card payments, and debit card payments can only be made by phone. Borrowers can also enroll in auto-payments at any time.

Advantages and Disadvantages

One advantage of consolidating through NaviRefi is the potential for lower interest rates and monthly payments. However, consolidating federal loans with a private lender like NaviRefi will result in the loss of federal benefits, such as income-driven repayment plans and student loan forgiveness programs. Additionally, NaviRefi uses credit-based underwriting, and Navient has been involved in several lawsuits alleging deceptive practices and misapplication of borrower payments. Therefore, borrowers should carefully consider their options and compare rates and terms from different lenders before deciding on NaviRefi.

Consolidation through refinancing

Navient does not directly consolidate federal or private student loans but services loans consolidated through other means. Federal Navient loans can be consolidated through the Federal Direct Consolidation Loan program at StudentAid.gov. For private Navient loans, consolidation options include refinancing through Navient’s partners (Earnest and NaviRefi) or other private lenders.

Navient loan consolidation combines multiple student loans into a single loan, simplifying repayment. With NaviRefi, student loan borrowers can refinance multiple private or federal student loan payments into a single new loan. There are no origination fees. However, in most states, NaviRefi is able to offer both fixed-interest rate and variable-rate loans.

When you refinance student loans, you receive a new student loan, a new student loan servicer, and new monthly payments. Most importantly, you receive a lower interest rate, which can save you money. However, if you refinance federal loans with Navient, they will no longer be eligible for a variety of federal benefits. By refinancing federal loans with Navient, you will lose access to federal income-driven repayment (IDR) plans and student loan forgiveness options.

Consolidating debt can be done with more than just a personal loan. Some other options to explore include balance transfer credit cards, home equity loans, and home equity lines of credit (HELOCs).

Frequently asked questions