imalreadyamember? wrote:1) When would PAYE be better than refinancing? The interest rate will still be really high, so the loans aren't really going away. Is this only desirable if I see myself going to govt/PI sooner/longer than expected? Although I can refi again, I can't gain back the govt benefits (e.g. PSLF), and that's really the only hesitation with the decision. Maybe irrational but it's uncomfortable to wait even while making low payments (or even at a low rate honestly).
See Tiago's answer. But generally I think PAYE vs refinance is a question of priorities, realistic career assessments, and risk tolerances. Personally, I like the idea of my school debt being gone and not having to deal with it so I put a higher value on refinancing than most. There's a ton of discussion on this topic in this and other threads so I'd search for it.
imalreadyamember? wrote:3) The "healthy" credit card debt is on a card still in the 0% APR period. It has to be paid eventually, but it's not accruing interest.
imalreadyamember? wrote:4) Most important: I see what you mean about my current interest rates not mattering for the refi rate. But doesn't it matter what my income is? Aren't they going to give me a lower rate if I say "I make 190k" vs. "I make 58k"? That's the main reason I thought I would wait until I start---being able to report my income as much higher. On that note, since my salary raises automatically every year, does that make any difference to them?
Yes, the higher income matters. You were debating refinancing "when I start work" versus "waiting a few months" so in that sense your income should be the same.
The salary raises might matter if you're on the edge of being accepted (e.g., you might have to wait until you get the raise to be approved) but they won't matter if you are already accepted (i.e., they aren't going to give you a better rate by assuming you will get raises).
imalreadyamember? wrote:5) How do I know that the bank is going to approve me for a certain set of loans? I don't want to mix and match to see what gets approved if it means my credit is pulled each time. And if I understand you correctly, I wouldn't get a lower rate by leaving out Sallie Mae? That makes sense yet I always thought the opposite. I guess I'm mixing up consolidation (all loans grouped together at their average interest rate) with refi.
You can't know for sure. You can get a feeling by talking to a loan officer (for example, the loan officer I worked with essentially told me I'd have to either raise my liquidity, wait till I was a second year, or get a cosigner to be approved before I actually submitted the paperwork). It is in the bank's interest not to waste time reviewing an application they would deny so they aren't going to hide the ball. I also don't understand the "mix and match" comment. You will have to disclose all loans you have when you apply for refinancing and the amount of other loans you have (whether it is student loans you don't ask to refinance or other types of loans such as for a car/house) affect your ability to be approved.
Credit pulls have a minimal impact so I wouldn't worry about that too much. They also might treat all pulls in a short period of time (e.g., 30 days) as a single pull. I know they do that for mortgage and car loan pulls, but not sure if they do that for student loan refinancing.
Yes, leaving out Sallie Mae is unlikely to make a difference and you were mixing consolidation with refinancing. Consolidation is guaranteed I believe (you don't have to be approved). Federal loan consolidation is where your federal loans are combined into a single loan with a single payment that has the weighted average of the rates. It doesn't apply to private loans. This is different from refinancing (which is getting a whole new loan) and generally not advised (because it removes your ability to attack the highest interest rate loans first).