Texas residents considering refinancing federal student loans may find that Brazos Higher Education, a non-profit lending company, offers rates below market average rates. The company also offers flexible repayment terms ranging from 5 to 20 years. If you have high interest loans, refinancing to one of Brazos’s term loan options could save you a ton of cash in the long run.
Should you refinance your student loans with Brazos Higher Education? This review will help you understand if you qualify and the rates you can expect.
Who Qualifies to Refinance with Brazos?
Brazos is a student loan refinancing company that specializes in refinancing loans for “established” residents of Texas. To qualify you need a good credit score (at least 720) and an income of at least $60,000.
If you don’t have the necessary credit score or income, you’ll need a cosigner, plus a FICO credit score of at least 690 and an income of $30,000.
On top of that, you can only refinance your loans with Brazos if you have a Bachelor’s degree (or higher) from an accredited university, and you must be a resident of Texas.
Brazos allows qualifying individuals to refinance loans of $10,000 to $150,000 for undergraduate loans and up to $250,000 for medical, graduate, or professional school loans.
In addition to offering student loan refinancing, Brazos offers parents a private loan option that serves as an alternative to parent PLUS loans. The loans Brazos offers aren’t as generous in terms of repayment options, but they carry low interest rates, so could be worth considering if you’re a parent of a student in Texas.
Rates and Terms
Although many people won’t qualify for Brazos loans, those that do will find great interest rates and a variety of terms. Brazos does not charge origination fees, and they don’t charge prepayment fees. It’s also great to see term options up to 20 years. This long repayment schedule could lower your monthly payment (while still holding onto a decent interest rate) so you can pursue other financial priorities while repaying your debts.
All the interest rates in the chart below assume that you’ll take advantage of the 0.25% auto-payment discount offered by Brazos.
Term | Fixed Interest Rate Student Loans (Refinance) | Variable Rate Student Loans (Refinance) | Fixed Interest Parent Loans | Variable Interest Parent Loans |
|---|---|---|---|---|
5-Year | 3.15% to 5.1% | 2.83% to 5.13% | 4.15% to 6.64% | 4.23% to 6.89% |
7-Year | 3.82% to 5.3% | 3.63% to 5.33% | 4.70% to 6.7% | 4.63% to 6.93% |
10-Year | 4.00% to 5.3% | 4.13% to 5.43% | 5.27% to 6.7% | 5.03% to 6.99% |
15-Year | 4.70% to 5.9% | 4.53% to 5.83% | 6.39% to 6.74% | 5.28% to 6.99% |
20-Year | 5.25% to 6.35% | 4.78% to 6.28% | 6.50% to 6.74% | 6.13% to 6.99% |
Any Concerning Fine Print?
Brazos student loans offer great rates and charges no origination fees, but the company isn’t perfect. Here are a few features that may mean you should look elsewhere to refinance.
The most concerning feature is a lack of cosigner release programs. Cosigners agree to take on payments when you can’t handle them. A lot of times, student borrowers need cosigners to qualify for private loans. However, after you establish your income and credit score, and have a history of timely payments, many lenders allow you to release your cosigner. This frees the cosigner from any future obligations. If you need a cosigner to qualify for a student loan refinance, you should probably look to lenders outside of Brazos.
Another possibly concerning feature (one shared by most private lenders) is the limited options for forbearance. Brazos offers up to 12 months of forbearance for economic hardship, but does not offer income-driven repayment plans. Brazos also offers limited forbearance if you’ve suffered from a natural disaster or you’re on active duty military service. To be completely honest, Brazos has relatively generous policies for forbearance compared to other private lenders, but the policy is far less generous than the policies in place for Federal borrowers. Borrowers who have income risk, or may need income-driven repayment plans in the future, should probably keep their Federal loans rather than refinancing.
The last feature that may be concerning is that Brazos doesn’t offer any grace periods. If you’re still in school, you’ll be expected to make full payments on the loans starting approximately 45 days after the loans are disbursed. This is true of the parent loans that Brazos offers too. If you’re not quite ready to start making payments, then don’t refinance with Brazos yet.
Bottom Line
Brazos Higher Education offers excellent rates and terms on student loan refinancing. If you’re a Texas resident that qualifies, you probably won’t be able to beat the rate. To be sure, consider comparing options at Credible, a student loan comparison site.
Still, private refinancing isn’t for everyone. Before you apply, be sure you’re confident in your repayment ability. You don’t want to land on hard financial times and be without the option of an income-driven repayment plan.
Leave a Reply