[Editor's Note: This is a guest post written by my business manager. We have a serious financial relationship and immense financial conflicts of interest as you might expect. In fact, this is probably the first “paid post” we've had on this site, since I'm sure she billed me for the time she spent writing this. At any rate, Cindy has been working here at The White Coat Investor for nearly a year now. She is a stay-at-home mother of four, so having the opportunity to work on her own time from home has been great for their family. They have a pretty significant student loan burden. A few years ago I introduced her to Dave Ramsey, and they've had some gazelle intensity paying off those student loans ever since. In fact, that student loan burden is one of the main reasons she decided to take on some extra work.
When it came time for them to refinance their loans, I told her to keep detailed track of the time she spent doing so, the hassles she ran into, and the rates she was offered. This post details her adventures in refinancing. I hope you find it useful. I have always wanted to write a post about my own experience refinancing my loans. But since I never had any, and even if I had they would have been paid off long before I could have refinanced them, so this is the next best thing. Be aware that Cindy and I also have a financial relationship with every company mentioned on this page. If you refinance through links on this page, not only do you get an awesome rate, and probably some cash back, but we get paid too. I always ask people to be extra kind in the comments section on guest posts, but if you leave a mean comment on this one, your IP address will be permanently banned, especially if she sees it before I do.]
I am not a doctor, nor married to a doctor, but my spouse does have a large student loan debt, which was at a ridiculously high rate. When the companies refinancing student loans
finally decided to take a chance on non–white-coat wearing individuals with good credit I was thrilled beyond words. It is pretty depressing to add up all the interest you paid on student loans for the year and find out that you can only deduct a small portion of it on your taxes (I know, I know, many of you can’t deduct it at all but that doesn’t make it any less depressing for me).
My experience refinancing my husband’s loans may appear a bit different than most of the readers' experiences due to three factors.
1. He is a self-employed cinematographer. If you thought your refinancing took reams of paperwork – I killed entire forests of trees trying to show proof of that income.
2. I did all the legwork of refinancing the loans, which are all in his name, while he was traveling around the world filming. Maybe not the best timing. It seemed he needed to tell companies multiple times that it was okay to talk to me about his loans, which was time consuming to the process.
3. WCI sent an email to his contacts at Sofi and DRB letting them know that his business manager put in an application to refinance her husband’s student loans. Letting them know that he anticipated me writing a post about the experience and that he appreciated anything they could do to expedite the process, get us approved and/or help us get a great rate.
You might think it's funny to steal WCI's phone and take silly pictures of yourself, but I'd recommend against it. Those sorts of things have a funny way of showing up on the internet.
With those disclaimers here is my experience:
They do not refinance student loans from Chapman University, where my husband attended graduate school nor refinance loans for a Master of Fine Arts degree. We were denied in the very beginning before wasting more than a few minutes of my time or killing any trees. [To be fair, I didn't let CommonBond know Cindy was applying before she was already rejected. I have no idea if they would have made an exception for her, or even if that played into the interest rates she was offered from DRB or SoFi who were aware of her connection to me.-ed]
CU Student Loans (now known as Lend Key)
Based on initial questions, without uploading any documents, we were conditionally pre-approved for a 5.17% within 24 hours. When I asked if uploading documents could improve our interest rate I was informed that interest rates are based solely on credit scores so no documentation would change that. They told me the credit score they pulled for my husband was 797. My conditionally pre-approved rate for Sofi was better than 5.17% so we canceled our application with Lend Key.
Gold Level Scholarship Sponsor
The Sofi website was the best to use of the four. It is extremely user friendly and loads very fast. When uploading documents you can see the list of documents that have successfully uploaded immediately and can delete documents as needed. Sofi allows screen shots as approved documents, which makes the process of uploading all your documentation much quicker. They also give you a conditionally pre-approved rate immediately. We chose a 5 year variable interest rate and were given the conditionally pre-approved rate of 3.055% with autopay. Within 24 hours I received an email from two different people at Sofi congratulating me on the pre-approval and giving me the next step. Then I received the same email again 2 days later. Very thorough in their congratulations.
But after that, the process got much more lengthy than with DRB. They required a phone call from my husband who was filming in Europe to verify that I could work on his loan application. Once permission was received they got serious about collecting documents. I gave them pay off documents for all 5 loans, proof of address, social security card, birth certificate, drivers license, verification of graduation, tax returns for the past 3 years, plus all of the W2s for 2013 and 2014 (11 total), and the most recent pay stub from the company he did the most work for in 2014.
I uploaded all the necessary paperwork, waited 4 days, then finally emailed asking about our application status. I received an offer that day for a 5 year variable interest loan at 3.43%. At this point it had been 12 days since my initial application.
We told Sofi that DRB had given us a lower rate and asked them to beat it. They came back with an offer of 2.68% the next business day.
Darien Rowayton Bank (DRB)
The DRB website loads incredibly slow. You upload documents but cannot see a list of what you have already uploaded. You cannot delete a document from your application either, which becomes a pain when you accidentally upload the wrong document. No initial rate is given.
The most frustrating part of refinancing with DRB was dealing with two companies. CampusDoor is the company that manages DRB’s online portal, collecting all the documents. Once you are approved and your loans have been refinanced, then you typically deal with DRB. But when our applications came across the desk of a senior underwriter and she saw that it was for a self-employed individual she got involved earlier than normal to ensure that they got exactly what they needed to get us approved.
That would have been great except that my husband gave DRB permission to speak to me about the refinancing process but not to CampusDoor. CampusDoor required that he call or log into his account to give approval (instead of via email like DRB) but there was no place that we could see online to give approval and calling while filming long hours in Europe was a pain. It was really frustrating to have several people working on our application that did not appear to communicate with each other nor were willing to talk to me.
Even more frustrating, it takes CampusDoor 24 hours to image the documents you have uploaded to the system. Meanwhile they'll continue to call you asking for those documents that they already have, but don't seem to know they have.
5 days after my initial application was submitted we received an offer for refinancing at 2.48%. We chose to refinance with DRB simply because they offered us the lowest interest rate.
DRB requires that you have a bank account with them. You don’t have to keep a balance in that account. They deduct money from your account a few days before your loan is due and put that money in your DRB account then deduct it from your DRB account to pay your loan payment. In order to make additional payments you have to transfer money to your DRB account and then wait for it to be available to then pay it towards your loan. Kind of a hassle. I had to go back and forth between CampusDoor and DRB to get all my questions answered depending on whether it was about the loan application or about the loan funding and payments. It would have been great to have just one point of contact for this process.
After the Approval
We signed our loan documents 15 days after our initial application. Our loans were paid off 15 days later. During this month we continued to make loan payments. Sofi told me that once we finalize the application, they would request updated payoffs from us that would reflect those recent payments so our approval decision would reflect the most accurate amounts. I assumed that would be true for DRB but I was incorrect.
At DRB they pay off your loans based on the initial pay off amounts, then any over payments are returned to them and it is deducted from your principle. In theory. I received several emails from DRB stating that they were lowering our principle amount borrowed as our previou
s lenders returned the over payments. But after a lengthy and frustrating phone call, forwarding of these emails stating lower original principle, and a promise to look into it and call me back, the money was repaid on my loan 3 months later.
In short, refinancing is a time consuming, frustrating, and totally worthwhile experience. With DRB it took 5 days to receive an offer, 30 days to pay off the loan, and 60 more days to have the extra money returned to my account. But who cares? We just went from loans at 8.25% to 2.48%. And if WCI keeps doing as well as he has been with this business [Most of Cindy's pay is based on ad revenue for this site-ed,] I’ll have them paid off within the year. Anyone want to buy an ad?
What do you think? Who did you refinance your loans with? What was the process like? Was it more or less frustrating than Cindy's experience? Comment below!
Thanks for the story, Cindy. I did a refi through SoFi and was pretty happy with the process. I am an ER resident and had to use my wife’s income (attending family physician) to refi my private loans (still deciding on PSLF, so I held off on the other loans). At any rate, I ended up doing the fixed rate. Despite my wife having a six figure income, I got a lot of kickback from DRB. This was about a year ago so maybe it has changed, but they definitely did not make the process easy. That said, it wasn’t particularly easy with SoFi either. I did however, appreciate the communication and customer service with SoFi and I felt their website made communication and uploading of documents extremely streamlined. In the end, like your story, the refi saved me 5+ percent on interest. WCI… Can I name drop and see if they will give me a lower rate??? JK. Again thanks for the story and the great advice.
First off, congratulations Cindy! I really admire the tenacity you employed. Well done!
I attempted a refinance with SoFi at the beginning of the year after reading a WCI article on the low interest rates available. My existing interest rate was 4.56%.
My experience was similar in that they couldn’t contact me often enough in the first days after my application (often multiple people in the same day, calling with the same script / request). Then once I had provided the additional documentation and was waiting on a better offer / final approval… Days go by with nothing, then someone will mistakenly call to read me the “congratulations” script without bothering to notice I’m waiting on them.
In the end, they refused to use any amount of at risk / performance based income in their rate equations (about half of 2014s income therefore ignored) and only used base salary.
The rate they offered was about 1% lower than what we currently had, which (based on my repayment plan for the loan) would have saved me about $800 by the time it was closed.
I did not have your tenacity and was more than a little irritated by the process thus far and requested my application be closed.
I received a call back later in the day to offer me a slightly lower rate (based on your experience, sounds like it is pretty standard for SoFi to NOT offer the best rates they can!). I not-so-politely repeated that I’d like the application to be closed and to not be contacted again.
Loan is now repaid through putting every spare penny toward it until it was dead.
Again, well done in not letting the time, hassle and red tape keep you from your goal!
Congratulations on paying off your loans. As you know, throwing money at them is more important in the end than refinancing them. Best to do both most of the time though.
DRB is definitely frustrating to deal with, but they do offer the lowest rates and the best payment terms. We currently refinanced private med school loans with them and are now refinancing private undergrad loans with a cosigner through them.
In my opinion, there is only one game in town for ALL medical residents/fellows and that’s DRB. The $100 payments during residency allows you to pick a smaller term than you normally would be comfortable with by providing a form of “insurance”.
Our example in rounded numbers:
DRB 5 Year Variable – 3% – Actual Length 9.5+ Years (5 Year+ 4 Year Residency + .5 Year grace + ??Fellowship)
DRB 10 Year Variable – 3.5% – Actual Length 14.5+ Years (10 Year+ 4 Year Residency + .5 Year grace + ??Fellowship)
SoFi 5 Year Variable – 3% – Actual Length 5 Years
SoFi 10 Year Variable – 3.5% – Actual Length 10 Years
We chose the DRB 5 Year variable with a 9.5 Year repayment period.
Rates are even, but we get an additional 33%-50% length in term for just being a medical resident. Even if SoFi’s rates were lower, they would have to be .5% lower for us to consider them. It’s even worse for SoFi because the first 4.5 years when money is tight, we only have to commit to $100 a month.
SoFi won’t be able to compete for Medical Residents/Fellows until they can offer a similar product.
What do you mean by $100 payment? You only have to pay $100 monthly towards your loan or you have to pay $100 as an “Insurance” like a mortgage insurance?
I am referring to this article:
https://www.whitecoatinvestor.com/drb-starts-refinancing-student-loans-for-residents/
Essentially, our minimum payment is $100 a month for the next 4.5+ years (4 Yr Residency + .5 Yr grace + ??Fellowship). After this, we will start making payments at the 5 year rate.
We can currently afford payments at the 5 year rate, but if I were to lose my job, we’d have to live off my resident wife’s income which would not be able to afford it. I call that “insurance” because it provides a cushion in case something happens to me or my job up until my wife makes attending money.
I would still recommend you to make more than the $100 payment, but it is nice knowing that is there in case something happens. We expect to pay off our private medical school debt in about 6 months which is way over that $100 minimum.
ooooh, That’s sweet! I didn’t know that.
Thanks for the information!!!!
So, your 5 years doesn’t start counting until you are an attending?
Once you graduated residency/fellowship, you have 6 months before your first payment on your selected loan jumps from the $100 to your actual rate. If your payments are below the minimum interest accrued, that gets added on to your loans 6 months after residency. There is quite a bit of fine print, but it’s straightforward.
Documents you will need:
2 pay stubs if W2
2 Years tax return if 1099
2 forms of ID w/ address (I used DL, Passport, and Insurance card)
30 day payoff for each loan
Med school graduation verification
Most recent loan statement
Email them your residency/fellowship specialty
Cosigners Need:
Income and IDs from above
I wouldn’t trust what they say to upload, because their system is slow and it takes them forever to tell you what you actually need. You will also get emails asking for stuff even though it has been turned in. I wish someone had told me this when I was applying.
Word of caution, think very very hard if you are going to refinance public loans. IBR/PAYE would probably be a good way to go if you plan on staying in a nonprofit/government job. WCI has great articles on that stuff which doesn’t need to be recapped here.
Thank you so much for your response! I am happy to have these options now for physicians and people who are willing to answer my questions. The fine print is confusing sometimes! Thanks again!
Can you expalin the repayment period more? I am a little confused so can you lockin a 5 year rate but not begin paying until after residency?
Thanks!
You are going to need to read WCI’s article on the program because there are a lot of details. I will paraphrase it below, but I am not really doing it justice.
https://www.whitecoatinvestor.com/drb-starts-refinancing-student-loans-for-residents/
You refinance with DRB and they use your average potential income in your chosen specialty to determine whether you qualify. You pick whatever term you would like and that they offer you based on credit worthiness.
During residency, fellowship, and 6 months after either program, you will pay $100 a month. I assume the $100 a month payment is there so you don’t forget about it and some kind of actuarial trick to get past some kind of internal/external banking regulation.
To calculate your real loan length take the amount of time left in residency, add in potential fellowship time, and add 6 months of grace period. For us, it is 4 years + ?? fellowship + .5 years added to the standard 5 year rate for a total of 9.5+ years.
I have only used DRB and federal loan companies (Sallie Mae, US Dept Ed, MOHELA) etc. We started with Sallie Mae (a big mistake). When the ED loans kept getting sold and transferred (no choice of ours) we had the same experience of taking 30/60 days to have the money paid off and then getting the reimbursements. DRB was slightly faster than the US Govt, so that wasn’t an issue for us. I thought this was par for the course. If SoFi and others go quicker, that’s great! I wasn’t used to it so I don’t care about the time lag as much.
Campus Door and DRB are frustrating because it is 2 companies, but when speaking with reps, they are helpful. We actually found Campus Door to be much faster than DRB in terms of response time… at least via email. Also, you can actually sign an authorized user on campus door. We didn’t try it with DRB, we just talked on the phone. There is an authorization tab, but the Campus Door website is a little confusing. The author is correct about the upload delays which is frustrating and the fact you cannot see what you uploaded. But you can electronically add a user.
We also chose DRB because of the great rates. Their customer service is friendly and helpful, but can be slow. They have updated their website but it still lags compared to other online banks and you can’t really set up online transfers easily. I have my bank set to transfer money in for paying extra payments.
However, there is a plus in that it is VERY easy to pay principal only payments. Extra payments can be set to deduct from principal and does NOT pay off interest, which will save money on interest accrual.
We refinanced 2x with DRB. The first time we did a 15yr fix (the longest term of fix they offered). We were very happy with customer service (time delays weren’t an impact for us because we had only dealt with slower services) and were saving money. We referred them to others. During one referral we found out they added to their services: they have longer fixed year terms and their rates had decreased. I called in to see if we could refinance again with them.
We actually changed to a 10yr variable term this go round because of the money we’d save. They let us refinance and they have no fees at all which was great. The frustration was Campus Door. It took forever to process, which made little sense because we already had a loan with them. One DRB rep said she’d have them process internally, but at that point it was so far in that the internal fix ended the same time as Campus Door. However, because it was the same bank, the extra they approved the loan for was reimbursed within a week instead of the 30+ days.
The author is right on the money with time. Based on our experience, it is normal. If the other institutions are quicker, great. The upload process is annoying but you don’t have to worry about snail mail or unsecure email. Customer service is very good. Of all lenders we had, we do like DRB a lot. It is inexpensive so their website could be better, but it is a small company and does what it needs to do. We would continue to recommend them.
And they have a referral program. Me recommending like this is me doing it without compensation. If/when friends join and they mention the referral, the one referring gets money. I have yet to get any 🙁 And here I am giving free advertisement without compensation. I am curious to hear what others feel about SoFi and the others 🙂
Hi there, I just wanted to share our experience with refinancing with DRB. When I saw the WCI’s blog about DRB on April 18, I told my husband about it. This loan is amazing news for medical students, residents and fellows! Only wish it was available 6 years ago when we were faced with his being the first graduating medical school class not able to defer interest until after residency. He is finishing his last year of training and will start his career as a pediatric Orthopaedic surgeon next month, only after accruing tens of thousands of dollars of interest on his loans. Needless to say we were very excited about this opportunity because up until this point we were not able to refinance. On April 20, he started the application with DRB. We were not approved until July 1. I’m not sure the exact reason why it took so long. Some may be my husband not always being able to reply quickly because of his long hours. I know he did mention confusion with uploading loans docs and not being able to see them. At one point he talked to someone who said they were really busy because it was graduation season. Anyways it was a long, tedious and frustrating process. When we were finally approved I was so excited but then disappointed again! The rates given to us were for 10, 15 or 20 year loans (5years was not mentioned). 5.5% for the fixed and 4% for the variable at 10 years. The variable rate scares me so we want to go with a fixed rate and 5.5 or even 5.25 with the discount for having a bank account through them just seems so high compared to what everyone else is getting and what is advertised. I am glad we have completed the process but very disappointed with the outcome and frustrated that they continue to receive such great advertising and praise! Especially after the amount of time it took to get approved and the amount of time my husband spent trying to work them.
That stinks. I don’t know why it didn’t work out as well. When we first did DRB, we did the fixed because I’m scared of variable too. We had a higher rate, 5.75 for 15 years. I don’t know what went into it, but it sure beat the 8.8 percent that we had initially and even the consolidated 7.75%
Then I saw their rates had dropped and they had more offerings in terms of time to pay off the loan so I refinanced with them again. We got offered the 5.75 for 20 years and 5% for 15. I can’t remember 10. But when we looked at how much to pay each year, we went with the variable 10 yr and got 2.66. I don’t trust variable, but I know from the two anniversary bonuses and paying down, it will be much less than 10 yrs. I think the break even point for the amount we’d have to worry about was 6% (calculating into account all the payments, we are making)… So we are on the variable. You can go through the pain (and yes you have the same laborious process) of refinancing with them. before you do, you can call to see what your rates would be. I did that and found out that yes, it was worth refinancing (even if we just did the fixed again). The gentleman on the phone plugged the numbers from the data they had in their system (so things might further change). He didn’t give a hard time. Some loan comapny reps give a hard time. One review here says they liked SoFi another didn’t. I have yet to speak with someone at DRB (and all but 1 at campus door) who isn’t helpful and/or is rude.
A phone call wouldn’t hurt. And if you do refinance and don’t like it, or are missing the 5yrs (which should be an option, that puzzle me) you can call in and ask about that. You have 30 days to decide and then another week once you do. The downside is the hassle.
The best thing to do with it is have your husband give permission for you to talk o your behalf. That will speed the process greatly.
I don’t work for DRB and don’t even get their referral money 🙁 but I’ve been so happy I am going to defend them. Such a fresh air from Sallie Mae or US Dept of Loans. Great Lakes and Mohela were all right. Costep wasn’t fun either.
Another vote for DRB!
Glad to hear DRB is still the cheapest. For me the process was a lot longer.
SoFi said I was approved after having given them all my information, but then when the loan was submitted and they ran the credit report (over 800), it took weeks to process, and when I inquired as to the delay they simply denied the loan. Such a waste of time and really an insult. Everytime I called or emailed I had a different person, some of whom seemed to care but most of whom didn’t really know what was going on. When they finally denied the loan, I couldn’t get so much as an explanation or reason for denial. They still send me shit in the mail every couple of months offering to refinance our student loans.
DRB’s process/system was initially a little more arduous, but the whole time I had a loan officer assigned to me who walked me through each step of the process. On service alone, hands down DRB was miles ahead of Sofi.
Ended up getting 3.48% variable rate for a 15 year term. Plan to pay it off hopefully in 5 or 6 years, but I’ll start making extra payments if the variable rate starts to vary a lot. 🙂 So far I’ve gotten two letters indicating the LIBOR has gone up by .02, so now we’re at 3.52%, which is still about half the 6.8% we previously paid.
I have a little more experience on the “head to head” than Cindy as I have actually refinanced two sets of loans, first set via SoFi and the second via CommonBond.
If anyone’s interested, here’s my expereince: about 1 year out of residency (and with one year salary under my belt) I refinanced my federal 6.8% loans into a 3.99 fixed 5 year term via sofi. The process was easy enough and felt very “silicon valley” as I was able to snap shot my bank statements and other seemingly important documents with my iphone and upload directly to their website. No faxing or scanning needed. The approval process took a few days and I called in several times to get more info. I wasn’t too impressed with their customer service (seemed like I had long hold times and unenthusiastic reps). But in any event the loan came through underwriting and the rate quote didn’t change. They don’t apply the 0.25% rate reduction for autopay until after you sign up through the servicer, which was some company called TruStudent. (aside: I will never understand why banks cannot just service their own damn loans!). the whole process was easy enough and I was rewarded with a free T-shirt (way too tight) and some coffee from a place in san fran that I gave away b/c I don’t have a coffee grinder. In the end the whole process was super easy.
Then I found WCI and decided to kill off my loans. So I shoveled all the money I could at them and paid off the 85,000 in about 9 months.
Then I decided to tackle the other set of federal loans, happily earning around 4.8% interest for uncle sam (they were from an earlier time when the government usurers were a bit friendlier). With more financial security now about 18 months out of residency and having just killed off a huge loan, I decided to plunge into the variable rate world. I could have gone back to sofi–after all I was perfectly happy with them–but just for the heck of it I applied via CommonBond instead. The advertised rates were identical–1.92% variable 5 year term. Fortunately, the process was super easy once again and not at all different from sofi. Just click a few things and upload some iphone shots of paystubs and the like…and boom, you’re approved for a 72,000 loan. Weirdly easy. Once again they send you to a servicer; They use some place called ECMC to service the loan. Because I clicked WCI link I received a much nicer gift: $300 real American dollars. Well, the paypal version anyhow. Much more useful than a way too tight T shirt and some coffee!
In the end, if you have good credit (mines north of 800) and can document physician level income I don’t think you’ll have a problem. If I had to choose which was better it would be common bond. The process from first click to loan disbursed was shorter than sofi and the bonus was MUCH better. But all told pretty similar.
I cant say too much about my experience with the variable rate thing other than rates will probably rise soon, and if they rise quickly I may just pay this puppy off faster than 5 yrs
We are with DRB, and initially they had a different servicer. However, they now service their own loans. They don’t have the best website, but it makes it a lot more convenient!
I am curious to what everyone’s thoughts are regarding going with variable or fixed? My concern with going with variable is that economy will tank and they will jack my rate up. I will be completing a 10 year refinance soon. Thanks.
Personally, I have always been more cautious and gone with fixed. This last refinance I bit the bullet and went with a variable, but it took a LONG time to come to that decision. I have spreadsheets and spreadsheets!
First I’d look at how long you are looking for. I actually went 10yr variable, but I plan on paying off in less than 10 so it is much less time. I looked at how much I am paying now and used that as the money I can set aside with the reduced rates. I actually pay our monthly requirement plus $400 a month extra because we had another loan end and had that much money to use, invest or pay loans. That extra $400 already helps a lot. Then I looked at the trends of LIBOR. I don’t see interest rates raising too quickly for this year, so I built in a small bump (and hope I am true)
Then I looked at the equal rate point. 4.8% fixed or 2.66 variable. Well the variable could climb to 4.8 before we pay the same. However, If I assume (x) years payoff before it even hits 4.8%, what does it really have to stay under before it becomes the same. So I made a bunch of graphs.
Then I made some tables of how much I really owe when I factor in the extra 400 in payments, because that’s a lot less that will be added to interest, so less time to pay back.
It’s all really case specific and how you read trends on the rates, and how frequently they adjust the variable rate. DRB is every 6 months, I believe based on the 3 month LIBOR.
It is a gamble, but so is any investment. My personal rule of thumb is 5 yrs or less I’d definitely consider variable. Over 10 definitely fixed. The middle ground can go either way. And you have to look at what you can afford. If you need to pay less money a month then you might need more years and thus go fixed. If you can afford to stretch yourself and can do it in less time, then variable looks the better option.
I use the same rule of thumb. I think with 2-5 years as I recommend for most docs the variable is a no-brainer.
Ok, so I have a few “dumb ?s”. For those of us who are still in residency and presently have no one to cosign for us, is it worth looking into re-financing at all? I’m a 4th yr psych resident so I plan to line up a good paying job soon but of course will not get the paystubs for my new job for 1 yr. Should I try to refinance my 400k+ loan now or wait until I work? Thanks!
You should refinance now assuming you aren’t going to do IBR. DRB is the only one who will use your future potential income. Even with the future potential income, your debt burden is pretty high. They may or may not refinance you. We were able to qualify with a total outstanding loans of 355 even though we only refinanced a fraction of that the first time around. Assuming all goes well, I’d still try to refinance once you are 3 months from finishing residency and have a contract. Your rate could only go up.
Thank you so much for the expedient reply!
Glad it worked out for you! I’m still stuck on DRBs arcane paperless process. I got locked out of their email system for the loan docs and am still waiting 3 weeks later, after 2 phone calls to request snail mail copies. And no, I don’t have access to a fax machine, hello 1990’s! And no, I don’t have another email address to give you but at this rate it might be faster to make up another one… Sigh… I really want that 2.9% though
Sorry they aren’t working for you. It isn’t DRB, it is their co-company Campus Door. Both companies can use an overhaul on technology, I agree completely. But, at least with DRB, I think it is because they are small. That is also part of the long wait times. I think with DRB, we spoke with the same 4 people through both refinances, and their customer service is great. Campus Door does seem bigger. Maybe they keep costs lower because of their system?
One thing I failed to mention in my “gushing” over DRB…
They do now service their loans. But beyond that, they are a true bank that does require a checking account with them. This has perks.
1) You can use it as a new online bank account. They give you free checks. Not just the first book. You get free checks. Most banks no longer do this. We have a few online banks. CapOne360 gives 1 book then it’s $5 per book. And I can’t recall the last time a bank branch gave free checks.
2) You get Loan Savings bonuses. DRB has its own rates. They are better than some worse than others. But as a professional with what I will call the White Coat Loan, you don’t have to meet their requirements. By having the loan, you can open a high yield savings account. It is, unfortunately still 0.9% When we first had it, we were getting .8% with Discover and .75% with CapOne3650. Ally now has .99 I believe and I know Discover is .95, so the .9 isn’t as good. But if you want something consistent they seem to be holding it. And if other banks are raising rates, they may raise theirs too, I don’t know. We had been using it for extra fluid savings until Discover jumped. Now we have more in Discover again.
Just a perk and food for thought. I don’t know if the other companies offer savings rates like this.
Unless they made changes as businesses are wont to do. I hope I’m not giving old information
About 9 months ago. SoFi gave me a slightly better rate than DRB, and was much faster with an easier to use interface. Got a tshirt, wine opener, and a pie! Then used them to refi DW’s grad school loans a couple months ago. It was easy to add me as a co signer since they already had my info. Used WCI’s link and got $300 back (in addition to another shirt and bottle opener. Still waiting for the pie). I have north of 300k loans and didn’t have the guts to ride out a variable rate for 10 or so years so went with the fixed rate. SoFi is transferring their services over to Mohela, seems to be going smoothly. SoFi answers their phones on weekends too which was helpful given my work hours.
MOHELA isn’t too bad to work with. Not the best website, but neither is DRB. Things can get confusing, but good customer service. We had some US DoE loans serviced by them at one point (stupid sell-offs, transfers)
Wish you continued success 🙂
My wife is now a second year EM resident and like Cindy, I was the one who took charge of the process of getting her med school loans refinanced with DRB and have to say it wasn’t as tedious and lengthy of a process as some have reported. My wife only spoke with them once on the phone to verify some info days before they disbursed the funds to her previous lender and I did everything else for her electronically. Her new rate is 4%, almost 3% lower than before, she didn’t need a co-signer despite still being in residency, I did add my income as part of household income, I’m a RN, but that’s all the info they have about me. Thankfully we’re able to make more than minimum payments to aggressively pay all we can now and in two years when she’s an attending and that being our only debt (140k), we plan on refinancing it for the lowest possible rate and for the shortest amount of time to pay them off ASAP. Thanks WCI for the post on DRB refi for residents! Now I’m waiting for the 300.00 bonus advertised by apply through the WCI link to put towards principal, but they’ve ignored my inquiry of when to expect it :-/
Just a note to Cindy, or anyone else at DRB, you don’t have to transfer funds to their account to pay extra principle. Or, at least I haven’t. I get a paper statement every month that looks like a payment coupon even though money is deducted from an account I specified to the DRB account, which is then used to autopay the loan. I just send a check with the paper statement indicating the entire amount of the check should go towards principle. Have been paying $2-3K extra per month this way for a little while with no issues.
I had actually paid enough ahead that they re-amortized my loan with the most recent rate uptick (to 2.68% from 2.66% for 10-year variable) and my monthly payment went down. Still plan on paying ahead and having it paid off way before the 10 year point.
I refinanced last summer with SoFi. I put in applications with both DRB and SoFi, but SoFi had much better service. Not sure if they’ll still do this, but instead of uploading all my loan information, I gave the representative my (temporary) password to my myfedloan account and he entered all the loan information for me, after which I changed my password again. I was a year out of residency with a nice anesthesiology job. I was approved and the refinanced loans were paid off within a month of me starting the process. I got my $500 bonus from them (need a very special link). I did have the same problem as the author of the article where it took a while to get that overpayment credited back to my account, but I was not charged any interest for that overpayment.
DRB was tough because they kept wanting more documents, which I uploaded. No one there could tell me what documents they really wanted, and the ones they sort of requested were not required ones on their website. In the end I became tired of dealing with DRB, so went with the great rate from SoFi.
I have been viciously attacking my loans and will have my loans paid off on my next paycheck. TruStudent (their servicer) has been simple to work with.
Other perks: Mint.com uploads their information easily. I didn’t have to open a checking account with them. My wife loves the t-shirt (one size didn’t fit all). I have had someone use my referral link and we both got $100 without any hassle.
It took us almost two months to get approved by DRB and SoFi. The rates came in one day apart at 4.75 and 4.74% for 5-yr fixed loans. We went with Sofi because the on-line system was easier to use and we’re in the same time zone. After aggressively paying down part of the balance, when WCI posted the article about interest rates dropping we refinanced to a 2.68% 5-yr variable. We checked with common bond and they thought our loan amount was too high to refinance, and I chatted with them about what medical student finances look like.
I definitely recommend trying to refinance for a lower rate if you are paying down the principal faster than anticipated or if the rates have dropped compared to your initial refinance. It will save us an estimated $6,000. We also got the referral bonus again when I clicked through the links here, hope that means you guys received the bonus again too!
I’m sure we did. Thank you!
Hi Pairadocs! I’m writing an article about doctors who’ve refinanced their student loans. Can I ask you a few questions? You can email me at zinakumok at gmail dot com. Thank you!
This post has good timing. After 8 weeks, DRB has just completed their 3-5 business day processing of my refinancing application. Despite my wife being a pediatric hospitalist with no student loans, and me now being a resident, they offered us their worst rates to refinance my student loans. They are actually no better than my federal rates at any term duration that makes sense.
That’s a bummer on both counts. Did you check with any other companies?
We just did DRB because we were planning to take advantage of the $100/mo during my residency. We may still take the fixed rate 5-year offer, then over pay during my residency so when the 5-year plan kicks in, it’s not really for 5 years. Do you know if these banks will refinance their own loans?
They do refinance their own loans. We just did it this year. We refinance 1 yr in, and they allowed that. Still no fee. Request, nay insist, they do an internal refinance. We still went through Campus Door and that was a pain in the neck. By the time it all went through, we had $4500 more than we needed. However, because it was internal at DRB that 4500 was reapplied within a week, instead of the 30-60days it takes to go from bank to bank, so that was good.
DRB over SoFi anytime. Sofi beat around the bush and denied without any reason for income 100, 000 and excellent credit scores above 800 for both I and my wife. Took DRB loan and paid off in two years. DRB was incredible with customer service and speedy processing. I have been telling all my coresidents about DRB.
Hi gasresident! I’m writing an article about doctors who’ve refinanced their student loans. Can I ask you a few questions? You can email me at zinakumok at gmail dot com. Thank you!
I applied to both DRB and SoFi at the same time late 2014 to compare options since my IBR was up for renewal and I would no longer qualify for PSLF. DRB’s paperwork requirements were more extensive and slightly cumbersome, but all in all it still took me less than an hour to acquire and upload all requested documents for both applications.
SoFi’s offer came earlier and they were more aggressive with post-offer incentives to encourage me to sign (offering cheesy gifts, frequent calls) even after I’d declined their offer stating a much better rate through DRB. They did not come back with a lower rate, and their offer was not much better than my rate prior to re-financing.
I went with DRB because their rate was a full 1% below SoFi’s offer. Ended up with a 10 year fixed at 4.5% with auto-pay, which was the best rate available at the time. I wish the current resident refinancing option was available while I was in residency (graduated 2014).
The having to bank through DRB to pay the loan is an unnecessary step IMHO, but customer service was good to help set up a connection to transfer additional funds to that account for early repayment. That single call was the only time I had to actually speak with someone on the phone from DRB, and that was kinda great!
So I’ve contacted DRB about the offer. They came back with a 0.25% reduction in the offer, which was nice. They also told me that the income of my spouse-co-signer does not factor into the rate determination. Only my resident’s salary is factored into the rate determination.
I would recommend checking out LinkCapital. Their rates are the best I’ve seen lately and they offer refinancing for residents with full deferment through residency. They focus specifically on refinancing an consolidating student loans for medical professionals.
Where did you hear about them? Are you associated with them?
I learned about LinkCapital at a conference and have since had a friend refinance with them. They were very pleased with the process and the rate they received.
I just refinanced with Link Capital this week. Never heard about them before, but was talkmr4ming with my advisers (Larson..thanks Dr. D for the referral :D) and their student loan guy said they were the best. Apparently, they have the better rates then the other companies and are super easy to work through.
Submitted my documents and loan information and accepted terms all within 1 week.
Fixed rates I got were 3.49 (3 years) to 5.40 (20)
Variable 2.08 (3 years) to 3.53 (20)
I have a very high credit score, so I’m guessing that helped. But $0 during residency. The whole process has been super easy.
Not sure if anyone will read this post since we’re off the main page, but hopefully you can get future residents a deal Dr. D.
Intriguing. I am with Larson and they did not mention CL. Would you mind sharing your DTI for both ends of the fixed rate offers? Do you have other household income augmenting your residency salary?
Not sure what you mean in regards for my DTI?
My resident salary is $52k with some in house moon-lighting that may get me an additional 5-10k. Other then that, no other income.
Credit Score: 800ish
Loan Burden: $55k-ish
Monthly Expenses: $1k/rent + utilities. +$500-1k spending
Ah, my loan burden is 4x that.
DTI is your monthly debt payment/monthly income. So a shorter term would have a higher monthly payment, meaning higher DTI for that rate/term compared to a longer term. DRB told me their qualifying DTI is <40% for the 5y term, so they might offer someone a 10y term, but not the 5y.
I’ve got a post coming up on them in one week. Links for the special WCI deal are in the left hand column.
It looks like their rates are comparable for DRB.
I ended up going with DRB. I did the resident deferment ($100/mo during residency) and the 5 year fixed plan, which will kick in after my radiology residency and fellowship. My interest rate is 4.5%, and once my repayment term starts in 2021, it will decrease to 4.25% using EFT. My intentions are to use our household income to pay the interest and some principle monthly during residency, so I will likely pay 40-50% of it off before my repayment starts, at which point I will probably refinance using my attending salary to get a better rate and term.
Has anyone else worked with LinkCapital? Does it seem like a legitimate lender with competitive rates? I am currently applying with DRB and Sofi. Wouldn’t mind having more options with low rates.
In the process of working with them now. They may have the best deal for residents right now. I’m working on a special deal for WCI readers through them so stay tuned.
Any update on the special deal you are working on? I’m about to start an application to refinance and wondering if I should hold out until you have your deal in place. Thanks.
It’ll be out Monday, or use the links on the left side of every page on the site.
See my post above, but they were super easy (<1 week to get approved) and apparently the "best" rates I've seen.
This may be a dumb question, but since I am considering refinancing my loans with one of these companies, I need to ask it.
How does repayment work? Hypothetically, say you have 300,000 in loans distributed between 5 loans. All are 60,000 each, but at 4%, 5%, 6%, 7%, and 8% interest, respectively. Currently, you could pay all of them as scheduled, but pay extra on the 8% until it is gone. Then, your monthly payment would decrease by the amount you would have to pay on the 8% loan because it is no longer in existence. Then, you could take your extra money and tackle the 7% loan and so on and so on.
With Sofi or DRB,etc, you get a loan at 5% for the entire 300,000. When you make extra payments, does your monthly amount due decrease? Or, does the term of the loan decrease from 10 years (are you basically just cutting down the time you have to pay the same monthly amount)?
If my assumption is correct, which way would be the faster way to pay the loans off if you pay the same each month? For example, say each scenario requires a monthly payment of 2500 each month but you pay 5000 no matter what.
Again, sorry for a seemingly dumb question. I just want to find the way to pay off my loans the fastest.
If you make extra principal payments, you get a shorter term but have the same monthly payment due.
The shortest way out of debt is to refinance into the shortest term, probably variable rate, and throw every dime you can scrape together at them. It would probably help to read Dave Ramsey’s Total Money Makeover too.
You mentioned Dave Ramsey…I’m a huge fan, read his books and listen to his podcast all the time. I’ve always wanted to call in and run my financial situation by him but apparently my boys aren’t putting out enough testosterone for me to get up the courage to tell him that I’m $320k in the hole and am choosing to do PSLF instead of attacking the debt like a gazelle. I’m curious if you’ve every discussed the PSLF option with him or what your thoughts are about balancing a large med school debt with his debt snowball plan?
Besides our house, the med school debt is the only debt we have. We want to work on our retirement/investing/college savings and all that but according to Dave’s plan, we need to knock out our debt before we start thinking in that direction…thoughts?
Funny you should ask. I have a post coming up on that subject- about how Dave is wrong about PSLF. He seems to have it confused with something else. I sent him a tweet once about tax loss harvesting-he didn’t seem to understand that it wasn’t about selling low, but never heard a response about either.
As far as what to do on your whole invest vs repay debt thing, if you’re going for PSLF don’t pay it off in advance.
Hi,
I am a medical student graduating this month and have started looking into loan refinancing. When is the optimal time to apply for loans? It seems these companies want information such as proof of graduation and income that I do not have at this time. Is it better to enter repayment with a federal plan first then look into refinancing later? For example Credible wants to know how much my monthly loan payments are currently and how many months are left on the loans before giving me rates, but as I have not entered repayment yet I do not have this information. Thoughts?
Thank you so much!!
Refinance private loans ASAP. Don’t refinance federal loans until you’re sure you’re not going for PSLF, and then only if the rate is lower than the REPAYE effective interest rate (it won’t be for most interns.)
I have my provided more info about SoFi Loan at [affiliate link removed.]
Also, sign up to receive $100 referral bonus at [affiliate link removed.]
[You seriously posted affiliate links on my site? That is a major internet faux pas. I’ve asked SoFi to re-examine their relationship with you.-ed]