Earnest Student Loans [An Honest Review]

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If you’re a student or recent grad, there’s a good chance you’ve seen ads about the company Earnest. Perhaps you’re curious as to what they can do for you, or maybe you’ve got a specific need in mind that you’d like them to help you out with, but don’t know the full details. In this post, we’re here to unlock the answers to all your questions regarding Earnest, and we hope that by the end, you’ll know whether Earnest is right for you. Let’s jump into it.

What is Earnest?

Earnest is a lending company founded by Louis Beryl and Ben Hutchinson that specializes in refinancing student loans as well as providing their own option for private student loans with some added flexibility in terms of payment schedule. In our view, the main two things that separate them from the pack are their flexibility in working with you on repayment as well as their offered interest rates.

They offer their products to college students, college graduates, and grad students, and post-grad students. Some of their specific student loan offerings target:

  • Undergrad students
  • Grad school students
  • MBA students
  • Medical school students
  • Law students
  • Students with co-signers

As you might’ve noticed, Earnest tends to select professionals and individuals with high salary potential. They also greatly value a history of on-time payments.

In addition to those things, if you’re a student with a co-signer, you’ll have a much better chance of getting approved for a private loan. Additionally, you’ll be able to get much more favorable interest rates. As for loan refinancing, they are able to refinance both the usual student loans and Parent Plus loans.

Here are the current interest rate details for Earnest:

  • Fixed APR range: 3.99 – 8.99%
  • Variable APR range: 3.24 – 7.99%
  • Available terms: 5 – 20 years

At this time, Earnest is unable to offer variable APR loans in the following states:

  • Arkansas
  • Illinois
  • Minnesota
  • New Hampshire
  • Ohio
  • Tennessee
  • Texas

Check out our review of Aidvantage student loans.

Is Earnest student loans a part of Sallie Mae?

Navient acquired Earnest for a total of $155 million in 2017. It was stated that Navient would run Earnest as a separate division and allow the original co-founders to continue leading Earnest. There was an agreement between Navient and Sallie Mae that prevented Earnest from refinancing Sallie Mae loans, thankfully the ban was lifted in 2019.

Is Earnest now the same as Earnest back then?

There’s been one really major change to Earnest, and that’s the fact that it’s been bought out by Navient Corp. While some things did change, it’s a point of contention whether it made the company worse or not. However, we’ll talk about those more in detail, including what the changes were, whether they were truly better or worse, and if they rectified any problems since the acquisition.

How does repayment work with Earnest?

With Earnest, you have the option to either make repayments while in school or once you’ve graduated. The graduation itself isn’t a necessary qualification, so if you’ve decided to drop out of school, it isn’t a problem. For those that graduate (or don’t graduate), you’ll have a grace period of 9 months before you must make the first payment. You can choose between monthly repayments or every two weeks, whichever works best for you. This, in our opinion, is part of what makes Earnest great. You can also work with them on how much you want to pay per month, and although it’ll generally affect the final interest rate you’re able to secure with them, it’s great to have the option for that trade-off.

Who qualifies to refinance with Earnest?

You must have a debt-to-income ratio of 65% or lower. On top of that, they require a credit score of at least 650. Otherwise, there are varying criteria for qualifications depending on what product you’re looking into. We highlight the main ones below:

  • You must be the primary borrower of the loan
  • The loan must pay a Title IV accredited school
  • Minimum of $1,000 loan request
  • FICO score of 650
  • No bankruptcy
  • Must have history of on-time payments
  • Must live in a U.S. state other than Nevada and Kentucky

If you want to increase you chances of getting accepted, consider applying once you’ve obtained a job and have showed stability for a while. This works for most lenders, as they like to see a stable source of income in addition to your profession’s income potential.

Can Earnest student loans be forgiven?

Unfortunately, once you decide to consolidate loans with Earnest, you won’t be able to participate in programs such as PAYE or any other federal loan forgiveness programs. This is the trade-off that you make when you work with a private company, though it isn’t always bad. Sometimes, it pays to work in the private sector and make more money versus a government job that qualifies for loan forgiveness. On top of that, with a private lender, you likely can refinance or get loans at a better rate than what federal loans can give you. Since the loans aren’t backed by the government, these institutions have more incentive to stay competitive in their rates as to attract as many customers as possible.

See how PSLF can help you forgive your loans.

Will my spouse be responsible for private student loans after death?

Generally, your spouse will not be liable for any of your student loans, both federal or private. However, always be sure to check the terms of your particular contract to verify, as it is always good practice regardless.

Can you refinance Navient student loans with Earnest?

The problem with Navient having bought out Earnest is that there are non-compete clauses that bar Earnest from helping to refinance Navient loans. If you have Navient loans, it would be prudent to look to other lenders to refinance with. You should be doing so anyways in order to secure the best interest rates possible.

What were some of the changes that Navient made to Earnest?

When Navient took over, there were a few changes to current user accounts, unfortunately. AutoPay had been interrupted for some users. However, AutoPay is still an option, and one that we recommend using since it takes 0.25% off your interest.

Furthermore, the website had been redesigned, and some would say it’s less intuitive and less straightforward. That is quite true in our opinion, as the new website isn’t as easy to navigate, but all the information is still there and it’s still relatively easy to find any information you might need.

As far as flexibility of payments, it seems they may have done away with bi-weekly payments for a bit, but have since re-introduced it, so it is still currently an option at this time.

Customer service overall is very helpful and competent, which they were before the acquisition.

Overall, despite the changes, Earnest is still the reputable company they were before, and they do things in a very professional manner.

What credit score is needed?

In order to refinance with Earnest, you’ll need to have a credit score of at least 650.

Will Earnest hurt my credit score?

Earnest allows you to do a soft check, as do many lenders, to see what kind of offer you can get. This won’t hurt your credit score. Then once you decide to go with a certain lender, they’ll have to do a hard pull which ultimately will affect your credit score. Your credit score will be lowered usually around 10 points and will last for a year. Remember though, you can do multiple hard pulls within a month time frame and it’ll all count as a single hard pull as the major bureaus know that you’re likely shopping around for the lowest rate possible.

Of note, when Earnest pays off your previous loan, you are effectively closing out an old account and replacing it with a newer account, which can lower the average age of your open accounts. This is taken into account in your overall credit profile.

How much does Earnest cost?

Earnest makes money by paying off your previous loan and providing you a new loan to pay off with a new interest rate. The interest rate is how much it costs for you to use their service.

A great feature of Earnest is that when you set up Autopay, Earnest will knock off 0.25% off your interest rate. There’s no reason not to use it.

Where is Earnest available?

Earnest is available nationwide with the exception of Nevada and Kentucky.

Earnest student loan alternatives

Here are some other competitors to Earnest you may want to check out:

  • SoFi (previously Sallie Mae)
  • Discover
  • Citizens
  • CommonBond
  • ELFI
  • Laurel Road
  • LendKey

Our recommendation when it comes to student loan refinancing

Our recommendation is that you contact as many lenders as you possibly can, including the above that we’ve mentioned, and do a soft check to see what interest rates you get offered. The best thing about many of these companies is that the application process is seamless, and you get a loan agreement ready to sign with the proposed interest rate within 10-20 minutes. Take your time and shop around. And if need be, shop around every year or so to see what better rates you can secure each time.

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