Personal loans for students, student loan refinancing

Student loan refinancing can lower your interest rate, simplify your payment and help you get out of debt faster.

PenFed student loans powered by Purefy


  • US citizen
  • 700 credit score to apply without a cosigner
  • 670 credit score, with cosigner that has a 720 credit score
  • at least one student loan
  • make at least $42,000 a year ($25,000 with a cosigner)
  • willing to become a PenFed Credit Union member

PenFed student loans powered by Purefy

If you’re one of the many Americans with an atrocious student loan debt, you’re not alone. Research shows that student loan debt is a bigger problem than most people realize. It’s the second highest debt category in the United States behind mortgage debt, and is higher than credit card and auto loan debt. In fact, the total student loan debt in the United States is an estimated $1.52 trillion as of 2018.

Falling behind on your student loan payments is easy to do. Luckily, you have options when it comes to managing your loans. The best thing to do is to start by consolidating your loans into one monthly payment, but choosing the right lender can be tricky. Penfed is a credit union that offers student loan refinancing so you can pay off your debt quicker and with less interest. Here’s how.

So, what's the catch? There is no catch.

Min Loan Amount


Max. Loan Amount




Interest Rate Type


Minimum Loan Term

5 years

Maximum Loan Term

15 years

PROS and CONS refinancing with PenFed

New and recommanded activities

Highly competitive rates

The interest rates PenFed offers are on par with what you’d get with a federal student loan

Parent loan refinancing

You can refinance federal loans into your child’s name through PenFed - something many lenders don’t offer.

No fees.

PenFed doesn’t charge any fees associated with applying, becoming a member or paying off your loan early.

High credit requirements

You need to have a credit score of 670 to even qualify for borrowing with a cosigner.

No deferment or forbearance

There aren’t any formal deferment or forbearance options you can apply for if you decide to go back to school or are struggling with your repayments.

Diploma required

You can’t refinance any debt from a degree that you never completed.

Who Is Penfed Credit Union?

Penfed is a credit union that was formed when Pentagon Federal Credit Union partnered with Purefy to offer a student loan refinancing program with low interest rates and unique terms.

Purefy is a company that was founded back in 2014 with the sole purpose of providing clear explanations and options for understanding your student loan refinancing options. They show you the exact rates for a loan before you even apply, which means that there won’t be any surprises if you decide to go with that particular loan. It also makes it easier to compare rates when you can see loan terms up front.

Pentagon Federal Credit Union is one of two partners that Purefy works with. According to Purefy, the partnership works because both companies have similar goals and views when it comes to offering transparent student loan refinancing options with no gimmicks and low interest rates.

Penfed allows you to compare reviews and terms for top student loan refinancing decisions before you commit to one. Penfed doesn’t directly service your loans, so your rates and terms will vary depending on which lender you choose. However, Penfed allows you to choose the plan you want after reviewing different lenders.

Penfed is unique because it’s one of the only credit unions to allow borrowers to add their spouse to their student loan refinance plan. On the other hand, they don’t have a structured forbearance or deferment plan, which most lenders provide for borrowers who fall behind on their payments or need to take a break for a few months. Although you’re still responsible for paying interest on paused payments, a forbearance or deferment plan allows you to miss a few payments without being penalized if money gets tight.

Penfed services borrowers that range from police officers and teachers to lawyers and doctors. It’s relatively easy to borrow from them. All you need is reasonably good credit and a low amount of debt compared to your annual income. Penfed also allows borrowers to refinance their parents PLUS loans. However, there are no opportunities to get a personalized rate estimate through a soft credit check.

Build on the principles of excellence

Penfed services borrowers that range from police officers and teachers to lawyers and doctors. It’s relatively easy to borrow from them. All you need is reasonably good credit and a low amount of debt compared to your annual income. Penfed also allows borrowers to refinance their parents PLUS loans. However, there are no opportunities to get a personalized rate estimate through a soft credit check.

Penfed by Purefy

How Does PenFed student loans work?

The Penfeld student loan refinancing program works by allowing you to take out a new loan to pay off your current student loans.

It’s a good idea to have your loans consolidated first. Then you can refinance anywhere between $7,500 amd $300,000 of your total loans. This includes both private and federal loans such as Parent PLUS loans. Your options include taking five to 15 years to pay off your loans.

Although Penfed is a direct lender, they use Purefy to process your student loan application. As with other credit unions, you will want to become a member to take out a loan with them. But you don’t need to be a member up front. You can apply to become a member while you also apply for a loan. The good news is that Purefy does a lot of the work for you during the application process.

Penfeld requires you to have good credit even if you have a cosigner. You or your cosigner can complete the entire application process online. If you have all of your paperwork together beforehand, then you can complete the application process relatively quickly. But don’t expect your funds until at least 16 to 20 days after you apply, so allow yourself some time if you need funds right away.

How to join Penfed

You can apply to refinance your student loans on the Penfed website. Before you apply, make sure you meet the following criteria

How to join Penfed
  • You need a credit score of 700
  • You must make at least $42,000 per year for loans that go up to $150,000. For loans over this amount, you must make at least $50,000
  • You must be a United States citizen
  • You must be a Penfed member or apply to become one at the time of your application
  • You must have at least one student loan to pay back
  • You must have a bachelor’s degree or higher
  • You must be at least the age of majority in your state
  • You can no longer be enrolled in school

If you plan on using a co-signer, then he or she must meet some requirements

If you’re planning on using your spouse as your co-signer, then one of you must have a credit score of at least 700 while the other has a credit score of at least 670. Additionally, the two of you must have a total combined income of at least $42,000 if your loan is $150,000 or below or $50,000 if your loan amount is higher than that.

Credit score

You must have a credit score of 670 or higher

Co-signer loans

Your co-signer must make at least $42,000 per year for loans up to $150,000 or $50,000 for loans over $150,000

Co-signer score

Your co-signer must have a credit score of 720 or higher


You must make at least $25,000 per year

Of course, you must provide proof of your income when applying. Follow these three easy steps to apply for a Penfed loan:


Visit the website

Visit the website and answer five simple questions to get your rate. These questions include the following: What is your highest degree? Where did you go to school? What is your estimated credit score? What is your state of residence? What is your preferred email?


Choose your terms

You’ll be provided with several options to consider from various lenders. Narrow down the right one for you by applying filters and customizing the offers to fit your needs. Purefy shows you how much money you’ll save on each offer based on what you’re paying on your current loan to help you make a decision.



Once you find the offer you want, click on “select.” You’ll be provided with a summary of your loan terms and you can either apply or go back. Click on the “apply” button and you’ll be redirected to that particular lender’s website so you can finish the application process.

In addition to filling out an application, you’ll also need to submit the following paperwork:

  • A copy of your transcripts or diploma to show that you graduated or are no longer enrolled
  • A photo ID, such as a driver’s license or passport
  • A recent pay stub to verify your income
  • Paperwork or statements from your current student loan service provider to prove your loan terms
  • A Penfed membership application if you’re not already a member

Once you get to the application, you’ll need to provide the following information:

  • You personal information, including your name, address and phone number
  • Your social security number
  • Proof of your citizenship
  • Your state ID, passport or driver’s license
  • Proof that you’re an active Penfed member or you’ll need to fill out an application to do so
  • You housing payment status including your monthly mortgage stub
  • Information about what college you went to and what your degree is in
  • Proof regarding your employment and how much money you make per year
  • All of your co-signer’s information, including his or her credit information, yearly income, personal information and all information outlined on this year
  • Details regarding your loan terms, such as length, interest rate, and all other terms you were provided
  • References and their personal information, such as name, address, phone number and what their relationship is to you

Penfed Student Refinancing Loan Terms and Conditions

Penfed allows you to refinance both federal and private student loans.

The credit union only offers fixed interest rates, but there are no hidden fees, application fees, prepayment fees or origination fees. Plus, you can refinance up to $150,000 or higher.

If you are five days late on a payment, then you can expect to be hit with a fee that is equal to 20 percent of your interest rate. Minimum late fees are five dollars while the most expensive is $25.

Your APR will depend on how good your credit is. It can also depend on your co-signer’s credit, too. Finally, your APR will take into account which repayment term you choose.

Here is a look at some of your options:

3.5% to 4.83%

for a five year term

5.39% to 4.29%

for an eight year term

6.43% to 4.72%

for a 12 year term

7.28% to 5.19%

for a 15 year term

If both you and your spouse have student loans that need to be refinanced, then you can combine them into one loan. Applying for a couple loan allows you to combine your income and your APR will be based on whoever has a higher credit score. If all goes well with your repayment plan, then your co-signer will be released after one year.

Here is a breakdown of the key terms and conditions for a Penfed student loan refinancing option:

  • Minimum loan amount of $7,500
  • Maximum loan amount of $300,000
  • APR 3.75% to 7.03%
  • Fixed interest rate
  • Minimum loan term five years
  • Maximum loan term 15 years

Interestingly, Penfed doesn’t require you to have a credit check before getting your rate. While other online lenders do at least a soft credit check on you before providing you with a quote, Penfed does not require you to enter your personal information before spitting out a quote. This is ideal because pulling your credit score often may affect your score.

Although Penfed doesn’t offer a forbearance or deferment plan, they will work with you on a case by case basis to meet your needs. This includes if you lose your job, have a death in the family, or become ill. You’ll want to discuss this with your advisor before signing any contracts.


  • No fees aside from late payment fees
  • You can use a co-signer
  • Your co-signer can be released after 12 months if you make timely payments
  • Couples applications are available
  • You are able to shop different lenders and terms without running your credit check first
  • You can see all terms and lending options ahead of time to make the best decision
  • Penfed will show you how much money you’ll save on your loans with each offer provided
  • Competitive rates compared to other lenders on the market
  • They refinance both federal and private loans
  • Offers a variety of term rates so you can pay your loans back faster or at a rate that is comfortable for you
  • All information about a loan is disclosed ahead of time
  • You can easily compare rates and use Penfed to shop around
  • You can refinance parent PLUS loans


  • No deferment or forbearance options available
  • You must make a lot of money and have a high credit score to apply
  • No rate discounts available
  • Must be a Penfed member to apply
  • You could get locked into a loan before deciding to go back to school

Should You Take Out A Penfed Loan?

Taking out a loan to repay your student loan might not be your first choice, but it’s a good way to pay off your student loans quicker so that you can stop racking up interest. You may even be able to refinance your loans for a lower interest rate so that you save money over time. It’s a good idea to consolidate your loans first if you have several of them. Check with Penfed to see if they provide that service.

You may want to hold off on taking out a loan with Penfed if you may want to go back to school. Penfed requires you to be out of school before you apply for a loan. If you get stuck in a loan and decide to go back to school, you may need out of your loan and this might not be an option.

Penfed also doesn’t offer deferment or forbearance options, so keep this in mind if you think you cannot meet your monthly requirements. You can always talk with a Penfed member to see what your options are. Their website claims that they have very good customer service and can work with you on a case by case basis.

PenFed doesn’t have any hidden fees outside of a late fee, which is a nice feature. They can also refinance both federal and private loans. Keep in mind that if you have federal loans, the Department of Education offers some benefits for these, such as student loan forgiveness and income-driven repayment plans. This might be a better option for you based on your income. Penfed requires you to have a high credit score and make a decent amount of money to become eligible for one of their loans. You might find a better option elsewhere.

Be sure to take your time when picking out your loan term. A lot of borrowers shop by interest rate but loan terms are just as important because they determine how quickly you’ll be able to pay off the loan so that you can maximize your savings in the future.


Penfed is a credit union that partnered with Purefy to offer competitive student loan refinancing rates. Using their services is easy and allows you to compare the prices and terms of various lenders and loan options. To qualify for a loan, you need to make at least $42,000 per year and have a credit score of 720. If you don’t meet these qualifications, you can opt for a co-signer. After 12 months of good payment history, your co-signer can be released.

You can also file a couple’s application with your spouse if both of you have student loans. Penfed doesn’t offer any discounts, but there aren’t any fees outside of a late fee, and they provide all of your loan term options without conducting a soft credit check as most lenders do. Keep in mind that they don’t offer forbearance or deferment plans. They also require you to be out of school before receiving your funds, so make sure you’re not planning on going back to school before applying for a loan.


CreditNervana promises to keep our information as accurate and up-to-date as possible. However, you should always consult a financial advisor for specific questions about personal or business finances and investment opportunities, especially if you are looking in your area. Working with a trained professional who is familiar with your case is a safe and guaranteed way to make the best investment decision possible. Please review our terms and conditions before making any decision based on the information we provide. Financial institutions are constantly changing. Because of this, it’s a good idea to cross check the information you read here with any company you are considering working with.


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