Your student loans might be costing you thousands more in interest than necessary. While millions of borrowers continue to pay their student loans at original rates, refinancing could significantly enhance your financial outlook.  
Student loan refinancing isn’t merely a financial transaction; it’s a strategic move and a deliberate choice to take control of your debt instead of letting it control you.  
Let’s explore five compelling reasons why refinancing your student loans through Admire could be the smartest financial decision you make in 2025.

1. Get A Significantly Lower Interest Rate

The math is simple but powerful. Federal undergraduate student loan interest rates are currently set at 6.39%. Meanwhile, qualified borrowers can access student refinance loan rates as low as 3.5% to 4% for fixed-rate loans. Keep in mind that these ultra-low rates typically coincide with shorter terms (5 years), and the borrower must have an excellent credit score. While this difference might seem small on paper, the impact is quite different. Consider this quick example: refinancing $100,000 of federal debt from a 6% rate to a 5% rate could save you nearly $1,000 in the first year alone. Over a 10-year repayment term, those savings can translate to almost $20,000 in total savings. That’s not pocket change. It’s money that could fund retirement accounts, serve as the down payment on a home, or accelerate other financial goals. 

2. Customize Your Repayment Timeline

Your financial situation today likely looks different than when you first borrowed for school.

Refinancing allows you to choose a repayment term that aligns with your current goals. Want to eliminate debt faster? Select a shorter term with higher monthly payments, but less total interest.  Admire has partnered with lenders that allow you to customize the repayment term down to the number of months (e.g., set your loan term to 75 months, instead of a standard 5-year or 10-year term).

Alternatively, extending your term can lower your monthly payment amount, creating breathing room in your budget. This flexibility puts you in control of your debt payoff strategy rather than accepting the standard terms you were initially given.

3. Simplify Your Financial Life

Managing multiple loan servicers, payment dates, and interest rates creates unnecessary complexity in your financial life. Student loan refinancing consolidates your existing student loans into one simple monthly payment with one due date and one servicer. 

This simplification eliminates the mental overhead of tracking various loans and reduces the risk of missed payments that could damage your credit score. Most lenders also offer autopay options, further streamlining the process (and offering you a rate discount in the process – a double win for you!).

4. Improve Your Debt-to-Income Ratio

Your debt-to-income (DTI) ratio significantly impacts your ability to qualify for mortgages and other loans.  With a high DTI (typically 45% and above), some lenders may not qualify you for a mortgage.  

By lowering your monthly student loan payment through student loan refinancing, you can improve this critical financial metric. For young professionals, especially, this benefit extends far beyond the student loans themselves, potentially saving tens of thousands on mortgage interest over time by qualifying for better rates.

5. Remove Your Loan Cosigner

Many students required a parent or relative to cosign their original loans. This arrangement creates a financial entanglement that affects both parties’ credit profiles and borrowing capacity.

Student loan refinancing provides an opportunity to remove cosigners entirely if you now qualify independently. This step frees your cosigner from responsibility while giving you full ownership of your financial future.

For parents with Parent PLUS loans, refinancing can transfer that debt to the student who benefited from the education, assuming they’re willing and able to take it on.

Key Items to Consider Before Refinancing

While the benefits are substantial, refinancing federal student loans means forfeiting certain protections. Income-driven repayment plans, potential loan forgiveness programs, and federal deferment options disappear when you refinance with a private lender.

The decision requires weighing immediate savings against these potential long-term benefits. For borrowers with stable income and good credit scores (typically 700+ FICO scores), the financial advantages often outweigh the loss of federal protections.

Your unique financial situation should guide this decision. Calculate potential savings using refinance calculators, compare offers from multiple lenders, and consider how the decision fits into your broader financial strategy.

Taking the Next Step

Student loan refinancing represents a powerful financial lever that remains underutilized. The potential savings extend far beyond the loans themselves, potentially reshaping your entire financial future.

The best refinancing candidates have stable income, good credit scores, and a clear understanding of what they’re giving up by leaving federal loan programs.

If you meet these criteria, exploring refinancing options through Admire could be the most valuable financial move you make this year. The thousands saved won’t just impact your balance sheet today. They’ll compound throughout your financial life, creating opportunities that extend far beyond the loans themselves.  Get started today with Admire’s Find My Rate tool!