Student Loan Refinancing With Credible- Personal Experiences

Every sponsor on this site wants me to write an entire post about their company. Occasionally, they later regret it as I don't give them any editorial control over what I write or what you write in the comments section. Ryan Kaldani, who works in marketing at Credible, has done a lot of work to get me some information I need to do a pretty good post about his company. We'll see if he regrets it! At any rate, Credible, is a little bit unique when compared to my other sponsoring student loan refinancers, and I love what they're trying to do.

The big sell with Credible is that you get to apply to many different companies all in one fell swoop- no multiple applications. The downside is that they don't have all the companies on their list (including several of the biggest ones), so that leaves you wondering if maybe you'd get a better deal if you also applied to those. Plus, it inserts another middleman into the process, and everybody wants to get paid. The lender wants to make money, Credible wants to make money, I want to make money, and you want to make/save money. The additional step where Credible steps in means someone else along the way is making less money. No big deal if there is a value-add there, but only you, as the end-user, get to decide what adds value and what doesn't.

Today I'm going to include the personal experiences of three people who applied with Credible to have their loans refinanced and what they liked and didn't like about the process. Two were positive, while the other was very negative. Like with most things in life, the truth is probably somewhere in the middle and your experience may vary, but based on recent changes I think the problems mentioned by the first two docs have now been eliminated or minimized.

A Positive Experience

I did this one as a Q&A with Dr. Abigail Polzin, an EM resident in South Dakota.

1) How many lenders and which ones did you apply with aside from Credible? Why did you choose Credible?

I tried a few lenders (Link Capital and SoFi) that were listed on WCI but kept finding that not many of them supplied loans in South Dakota. Credible offered a single place to apply to multiple lenders. I received offers the next day from at least 3 sources for refinancing that was available to me.

2) Was it clear exactly when in the process Credible was going to do a hard pull on your credit?

No, I guess I didn't really know that.  I do have an “I love debt” Score of 817 right now, and haven't opened a new credit account in years, so I wasn't super worried about it.

3) Did you apply with more than one lender through Credible? Why or why not? Which one of those did you go with and why?

When you fill out the Credible paperwork it automatically sends your application to multiple lenders.  I think you can choose to which ones they go, but I just let them send it out to multiple ones because of the state-specific brick wall I kept hitting.  I think overall there were three or four companies that I heard back from.

I ended up going with College Avenue – one of the first lenders that got back to me.  I was offered a five year repayment at 2.75% for $187,770.  This lowered my interest from 6.8% for a savings of about $8,000 since I plan to pay this off in the next 1.5-2 years.

I'm not sure if it's typical for College Avenue Refinancing, but I got a “Head of Refinancing” actually calling me, giving me cell phone and e-mail access for questions as they arose.  (It could have been the loan amount that earned me this special service). Once I went with College Avenue it seemed like Credible was pretty out of the picture.

4) How long did the whole process take?

Start to finish it took about 1 month. One thing I did like about Credible was that you only had to make a log-in with them – they made all the other accounts up for you and really did the paperwork.  I only entered information once – not 4-5 times.

I hemmed and hawed about refinancing all together since we're on such a great path at chipping away at the loans.  But $8,000 was a lot of money for pretty little effort. I did get some mailings from other lenders, and maybe a few e-mails telling me that I had other offers, but I wasn't hounded by Credible or other lenders after picking a refinancing option. Once approved through College Avenue Refinancing the longest part was getting the payoff amounts from my individual loans.

The most challenging thing throughout the whole process was keeping track of which company I was actually working with- Credible found me the lenders, College Ave Refinancing was my lender, and the day after my loan disbursement I was contacted by Navient who will be collecting the payment.  Maybe I'm naïve about how this all works, but my head was spinning with all the names and log-ins that I had to keep track of.  Now that it's done it will be nice to make 1 payment though.  It's hard not to feel cheated and ripped off (and averse to debt) when the company you're working with keeps changing.

The biggest obstacle was working with Nelnet (these were all federal loans that I refinanced – all my other ones are paid off) – they took FOREVER for the payment to go through, and I ended up having to pay another $48.50 in interest since it took an extra business day from the 30-day payoff amount I was quoted.

5) Did you have any customer service issues with Credible? 

Nope.  Again, in the whole scheme of things, they were only the facilitator of finding me a good lender with an interest rate I liked. I think for other people who may not have as many options (again I don't know why the State specific thing was so challenging) this was a good way to see what kind of refinancing options are out there for them.

A Negative Experience

This reader didn't have nearly as good of an experience and later sent me an email from which I'll take some excerpts:

Issues With the Hard Credit Pull

Long story short, I got a hard pull via Credible which was unexpected and unwelcome. Admittedly, it's entirely possible that I'm 100% to blame, but I don't feel the threshold between soft pull and “by proceeding past this point you will generate a hard pull” was very well delineated on their website.

Lousy Offers

I wasn't impressed by any of the offers they presented to me, so I deleted my account, which of course makes it difficult to retrace my steps. However I got one email from them, transcribed here:

Thank you for completing your Credible offer request form. Here's what happens next…
1. Credible submits the information in your profile to our partner lenders
2. Select lenders may begin to contact you directly with information about your offers
3. Credible notifies you within 3 business days once all lenders have responded
4. Upload any required documents to lenders' sites for offers you wish to pursue

followed shortly thereafter by requests by 3 lenders for more information. Only one of those lenders generated a hard pull (Citizens Bank, if that matters).

So long story longer, maybe I just missed the big, obvious “hard pull button” during their application. Maybe I'm a WCI reader who's kinda pissed about them (not you) and reconsideration of their sponsorship is in order. Later, I found this link which gives ballpark estimates from all their refinance lenders. If I had seen this initially I never would have proceeded. Their rates are at best on par with some of the other well known lenders, which I won't mention so I don't show bias towards the company that I've used previously. In my humble opinion, residents have few options and on graduation there are a few more well-vetted options. Beyond that are uncharted waters which I personally wouldn't travel.

What Does Credible Say?

WCI back here. Dr. Polzin shared her review with Ryan at Credible and he sent me a bit of a response about it. I didn't send him the more negative review. He mostly just wanted to point out that the process was completely revamped and improved shortly after Dr. Polzin refinanced. For example:

• Old process: required users to submit all information, including SSN, in a long and comprehensive form.
• New process: only requires a simple, one page form that rarely requires SSN
• Old process: triggered a hard credit inquiry
• New process: triggers a soft credit inquiry which does not affect the credit score
• Old process: qualified users received offers in 24-48 hours
• New process: qualified users receive instant offers

So hopefully the new process eliminates a lot of the issues people have seen in the past. Ryan also hooked me up with another WCI reader, Dr. Angela Zhang, who refinanced with Credible more recently than the previous two, and I asked her the same questions I asked Dr. Polzin.

1) How many lenders and which ones did you apply with aside from Credible? Why did you choose Credible?

I'm currently a 3rd year Family Medicine resident without an employment contract in hand (although I had an offer letter), so I was applying as a resident, not an attending. I applied with several lenders as follows:
– Darien Rowayton Bank: Awful experience. I applied 6 months ago and STILL haven't heard back from them about my application decision. I stalled out in the “second manual review” phase of the loan application process because my loan amount was so large (~300,000). They would not let me directly talk to a loan underwriter to discuss my file or offer supportive material for my application.
– Link Capital: They stopped taking applications due to insufficient funds. I did not find this out until after starting a profile- their website did not say they weren't taking new loan applications. I called several times to see if they'd open up the process again and they kept saying “in the next few weeks” but it never happened. I really wanted to see if I could refinance through DRB or Link Capital because I didn't want to make full payments during residency, but I had to look into other options.
– Sofi: As a resident, I could not apply without a co-signer or a signed contract (offer letter didn't even work). Also my offered rate was higher than the CordiaGrad quote even with a co-signer.

I found Credible through your website “student loan refinance” page. Since I'd had such awful luck with the other lenders, I wanted to use the “Kayak” feature through Credible and use one application for multiple lenders. The website was super user-friendly and I really appreciated that they were able to pull my loan amounts and interest rates from my FedLoan website so I didn't have to enter everything in (I have something like 11 separate loans so that would've been a headache).

2) Was it clear exactly when in the process Credible was going to do a hard pull on your credit?

I thought it was clear that they would do a hard pull on my credit but this may have been the fact that I expected it after having already worked with so many other lenders.

3) Did you apply with more than one lender through Credible? Why or why not? Which one of those did you go with and why?

I was very disappointed to see that I only was prequalified for one lender through Credible- CordiaGrad. When I asked Credible why, they said it was because the other lenders had a upper limit to how much they would lend and my loan amount was too high. I was a little skeptical about CordiaGrad because I had never heard of them before but my financial advisor did some digging and no red flags came up. I decided to go with CordiaGrad for a 5 year loan fixed, at 3.95% (after a .5% discount for direct payment from a CordiaGrad Bank of Virginia Account), paying about $6300/month (how do I manage that on a resident's salary you may ask- through help from my parents and some earlier investment accounts.)

4) How long did the whole process take?

I set up a credible account at the end of January/early Feb and my loans were disbursed at the beginning of April, so about two months . My first payment to Cordia grad is due on 4/14.

5) Did you have any customer service issues with Credible?

I didn't have any customer service issues with Credible. They were always checking in on me through email and by phone. I was a little confused at first between who I needed to communicate with about my loan application since technically everything needed to go through CordiaGrad and Credible was kind of just a “middle man”. They had decent hours, were on Pacific time, and had webchat support option which was great since you know how hard it is for us to make phone calls during business hours.

I also had great customer service from Cordiagrad/Bank of Virginia. Their hours were clearly posted and although they were on Eastern time, I had a customer service rep assigned to my file. She touched base almost every day through text and helped me get through several snags along the way very quickly and efficiently. For example, I didn't qualify on my own again due to income to debt ratio so they allowed my dad to co-sign. My dad has a bunch of real estate and various loans on those properties that made it look like even with his co-signing I didn't qualify, Cordiagrad waived that after I produced an offer letter from my future employer. Then for some reason they could not fix the correctly quoted rate on my online Cordiagrad/Campus Door account because of hardwiring in their program. However, their VP wrote me a personal letter to confirm my actual rate before I signed the promissory note. The only part that was a little annoying was that they were not very clear about how to set up the automatic payments through Bank of Virginia but they were responsive to all of my questions and I was able to figure it out relatively quickly. I guess I eventually could have refinanced my loans once I started my first attending job after residency but I didn't want to wait as my med school loans were at about 7% on average and I was accruing interest very quickly.

Overall, I'm glad I was able to refinance during residency through Cordiagrad since I had poor luck with the other lenders. I would not have known about Cordiagrad without Credible so I'll give them some “credit.”

Some More Thoughts On Credible

A few other observations I'd like to make about Credible. The bigger players in the high-income professional refinancing market, the CEOs of which I've both met personally, are DRB and SoFi and those are the companies that most of you are still refinancing through based on the numbers I see each month (although I'm seeing more and more from LendKey, CommonBond, Earnest, and most recently First Republic.) Credible doesn't have any of those lenders, which limits their utility in my view. I think it's awesome to be able to just do one application, but it doesn't do much good if the best lenders aren't on the list. Looking at the list of lenders Credible has from the link above, there are a few things that make them less than useful for a high income professional.

Low Maximum Limits

On the day I wrote this post, there were eight lenders at Credible, only one of which I have on my list of recommended options (Common Bond, which only a few of you each month refinance with for some reason I'm still trying to figure out as they've been around a long time and seemingly offer good rates and high limits.) Of those eight, six of them have total loan limitations that would apply to many docs. These range from $25K (are you kidding me?) at PAVE to $350K at CordiaGrad. The average med student loan burden is higher than the limit at four of those six.

Limited Options

Four of those eight lenders don't offer both variable and fixed rate loans. One of them only lends in Rhode Island. Two of them don't offer five year terms (my usually recommended length for high income professionals-Remember? Live like a resident for 2-5 years so you can pay off your student loans.)

Higher Rates

Not every borrower gets the lowest advertised rates, but some do, and there's no way you're going to get a rate lower than the lowest advertised rate. Only two of the companies will ever get you a fixed rate under 4%, and only four of them can get you a variable rate under 3%.

So, while it's cool that Credible now offers you eleven options with one application, those eleven options may not be the best eleven options on the market for your situation. For these reasons, I can't yet recommend that you use them exclusively as a one-stop shopping solution, but I don't see any reason not to include them in your search for the best deal. Here are the other ones to include along with a few details about any special WCI reader deals if you use these links:

 

Student Loan Refinancing Disclosures

What do you think? Have you applied with Credible? What was your experience like? Did you end up refinancing through them? Which of their lenders did they pair you up with? What did you like and dislike about the experience. Comment below!