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Are you one of the nearly 45 million borrowers carrying student loan debt? According to a recent Forbes article, U.S. borrowers owe nearly $1.6 trillion in student loan debt, the second largest consumer debt behind mortgage debt. Student loan debt even surpasses the amount owed for credit card and auto loans in the U.S. 

Although it may feel like an insurmountable task, there is hope for paying off student debt. To provide financial solutions for student loan borrowers, we spoke with Mike Kuhl, Marketing Manager at Nelnet Bank. Nelnet, with over 40 years of experience, is one of the nation’s largest student loan servicers and has recently launched Nelnet Bank to provide new options for students looking to repay their debt.  

According to Kuhl, a great option for borrowers is refinancing their student loans. An ideal candidate for their student loan refinancing service is someone who’s graduated, is gainfully employed, has established credit, and wants to either accelerate paying off their loan, or extend the term to lower their payment. 

“We see a lot of interest from people with all degree types. We’ve seen refinances for as little as $5,000 to $500,000 from someone graduating from med school.” Kuhl said. “We can typically offer a better interest rate and adjust the term of the loan to fit the needs of each borrower.”

Helping students save

Nelnet Bank’s student loan refinancing service provides students with an improved loan solution by offering them a better rate and different term options. Students can choose from a variety of available terms ranging from 5 to 25 years, with no prepayment penalty for paying the loan off early. 

“One of the questions we often get is when is the right time to refinance?” Kuhl said. “We encourage borrowers to look at any time — there is no cost to the borrower to see what rate they qualify for, and it doesn’t cost them anything to finalize the loan.”

“We often hear stories from borrowers on how easy it was to refinance their loans, and how grateful they are for the savings,” Kuhl said. “They didn’t realize refinancing could save them that much or be done that quickly.”

How much money on average do borrowers save by refinancing? It depends on how much student loan debt you are refinancing and the loan terms you choose. To help borrowers estimate their savings, Nelnet Bank has created a Loan Payment Calculator that shows a range of monthly payments based on your student loan balance. 

Managing debt in difficult times

The Coronavirus Aid, Relief, and Economic Security (CARES) Act, established in March 2020, provides temporary relief to borrowers with qualifying federal student loans through December 31, 2020. If you haven’t been receiving this benefit and believe you’re entitled to it, please check directly with your loan servicer.

Those in the military can apply for military service deferment which allows the postponement of student loan payments while serving on qualifying active duty.

Reaching your financial goals

Kuhl suggests reviewing your financial goals and identifying where you want to be in five to 10 years. “Finance is personal and everyone has different goals. Some are saving up to buy a new car, or a house, or start a new family, and there’s a lot more flexibility with refinancing” Kuhl said. “Look at your options and see what steps you need to take to get there. We can help you accelerate the process of paying things faster.” 

Kuhl said he’s seen a recent shift in students enrolling in college over the past five years. Where many students previously didn’t hesitate to incur debt to go to college, he’s now noticing generations where parents are discussing the challenges of paying off their student loans with their college-bound children. 

“Students are more educated about the cost required to get their degree, and they’re thinking about things more holistically,” Kuhl said. “Borrowers are more informed today, and are taking a more diversified approach to college by starting college with more credits, using community college credits, and then transferring to college to help chip away at the total cost earlier.” 

How can aspiring college students plan ahead to limit the amount of money they will need to borrow to attend college?

“The biggest thing for students today is to have a clear path of what you want to accomplish,” Kuhl said. “Set a budget and only take out the loans you need to in order to reach your goals. There is great information available for families and students to make sound choices of where to go to school, what field of study to move forward with, and the income potential after completing your degree. Evaluate your options and select the choice that makes the most sense to you and your family.”

RELATED: Student Loans: How to Manage Student Debt

Want to learn more about the cost of college? Check out our college search tool which provides helpful information, including the cost of tuition before and after financial aid is applied.