Everything You Need to Know about How to Refinance a Credila Student Loan in the U.S.

Student loans have been helping many students for years to fulfill their dreams of attaining a higher education. No doubt, it’s a boon for those who can’t afford the high-fee structure in some of the world’s premium universities. The equation is simple — you utilize the loan to cover the cost of your education and repay the funds once you start earning a living.

Having said that, not every situation unfolds the way you expected it to. There is no guarantee you will be able to get a high-paying job right after completing your studies. It may become difficult to adhere to the repayment schedule if you get stuck in a low-paying job, or worse if you can’t find immediate employment. Failure to repay the student loan on time can not only affect your credit score but also push you into a debt trap which can be difficult to overcome.

So what’s the way out if you are unable to honor your loan repayment commitment? One effective way to relieve the burden is to go for student loan refinancing. Go through this article to find out what refinancing is and how it can help you handle your finances better.

What is Student Loan Refinancing?

Student loan refinancing is the process of clearing an existing student loan by taking a new loan with a better rate of interest and more convenient terms. You can pay off your existing loan account in one go and continue with the new loan. Since refinancing allows you to secure a lower interest rate – which, in turn, reduces your monthly payments. You can also negotiate your other loan terms to better suit your situation.

Student Loan Refinancing Eligibility

To obtain student loan refinancing, you must fulfill certain eligibility criteria. It’s important for the lender to verify your current financial status before approving your loan request.

As you might already have figured out, a good credit score is a prerequisite for the approval of your loan application. In addition, you must show a steady stream of income that shows you can afford the monthly installments. Thirdly, your visa status can play a role in the decision to approve or deny your request for refinancing. Banks usually prefer H1-B visa holders, but there are a handful of lenders that extend refinancing to students who are on an F1 or OTP student visa.

4 Reasons to Refinance Your Credila Bank Student Loans

Credila is an initiative by HDFC Bank that caters to students in need of a loan. With a 100% financing option, pre-visa approval, extended tenure support, and a flexible interest rate, Credila Bank has emerged a trusted establishment when it comes to competitive student loan offers in India.

However, a comparative analysis with the U.S.-based lenders reveals a different picture. There are several areas where U.S. banks offer greater convenience and value. Let’s find out the top four reasons that make refinancing your Credila Bank student loan a sensible choice.

Your Interest Rates Are Too High

While most of the U.S. lenders offer personal loans with 7% – 9% interest rates, Credila typically offers 14% or higher. That means if you decide to refinance your student loan with a U.S.-based bank, you are making a net gain of 5% – 7% on the rate of interest. Quite obviously, that can make a significant difference to the actual monthly installment you are supposed to pay.

Only Variable Interest Rates Offered

All Credila bank student loans offer only variable interest rates. In other words, you can’t be sure what the applicable interest rate will be when you are ready for repayment. While there is a chance the rate may take a downward turn, the opposite can never be ruled out.

On the other hand, opting for a fixed rate loan gives you a clear picture from the very beginning. You are aware of the actual value of the monthly payment and the loan duration — which can help with your budget and other financial planning.

You’re Losing Money on the Exchange Rate Every Month

When you make payments to an Indian bank from abroad, your transactions have additional currency exchange charges. The charges incurred in the dollar to rupee conversion can cumulatively become a significant amount. By refinancing your student loan with a U.S. lender, you can completely avoid this additional expenditure.

The Customer Service is Terrible

Credila doesn’t have a great reputation when it comes to customer service. You can find lots of complaints on online forums about what customers have to face while dealing with Credila customer support. U.S. banks, on the other hand, score much better in this aspect. Responsive and helpful customer support can make for a much more satisfying user experience.

Can You Refinance Credila Bank Student Loans in the U.S.?

All major lenders in the USA offer loan refinancing to cover a wide variety of loan types. If you are looking to refinance your Credila loan, you will have lots of options to choose from. However, this can pose a challenge to non-U.S. citizens as quite a lot of U.S. banks simply refuse to deal with immigrants.

Why it’s Hard for Non-Citizens to Refinance Loans in the U.S.?

There are a few possible roadblocks you need to overcome to make yourself eligible for student loan refinancing in the U.S.

One potential hold up is that international students typically have a limited credit history and income. These are important factors that lenders use to judge an application for refinancing, leaving non-citizens at a disadvantage. Another possible issue might be that international students and visa holders are considered high-risk by American banks because of their temporary status. Student loans can be a substantial amount of money and normally take many years to repay, meanwhile, borrowers on visas may have to leave the country at any time.

How Can Stilt Help?

Stilt makes it a point to act as an equal-opportunity lender without any bias towards the applicant’s origin or nationality. The organization is known to offer loans to immigrants and non-U.S. citizens. Even if you don’t have a credit history, you can still obtain student loan refinancing from Stilt. In fact, Stilt is the only lender in the United States that offers refinancing to students on E1 and OPT visa — even before they could secure an H1-B visa.

How to Refinance Credila Bank Student Loans with Stilt?

The application procedure is quite easy. You need to fill out an online application and submit any relevant documents. Stilt validates the information, cross-checks your credit score and source of income, and comes to a decision either to approve or deny your loan request.

If approved, you will be promptly notified. The disbursal of funds may take another couple of days. All in all, the loan amount gets credited to your bank account within 3-5 days of submitting the initial application.

3 Tips for Refinancing Your Credila Student Loans

Look for a Lower Interest Rate

For best results, consult with as many lenders as possible. Then compare all the offers and go with the one offering you the lowest interest rate.

Get a Fixed Interest Rate

A fixed interest rate is always preferable over flexible terms. Variable rates may work in case of short-term loans, but when a longer time frame is involved, it is always a safer bet to opt for a fixed interest rate.

Look at the Reviews of the Customer Service

When it comes to the service industry, the quality of customer support matters a lot. So make sure to do your research before making a choice. A quick sneak-peak on online financial forums can give you a fair idea about what to expect from a lending organization.

Conclusion

You may not get favorable terms when you apply for a student loan in your native country. But with the security of a U.S. job, you will have far more bargaining power to demand a better deal. That’s why it makes sense to refinance your student loans in the U.S. There are quite a few tangible benefits of refinancing which include a better interest rate, lower monthly payments, and more convenient loan terms.

To sum things up, if you are finding it difficult to afford your student loan payments, then refinancing can be a smart option to secure both your immediate and distant financial future.

Edmunod Daco

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