MEFA Student Loan Refinancing Review: Best For Good-Credit Borrowers With Job Security

What you need to know:

• MEFA offers competitive refinancing rates to borrowers across the nation.
• Its refinancing loan is best for borrowers who have job stability and don’t foresee needing deferment or forbearance options in the future.
• You might need a cosigner if you don’t meet MEFA’s strict refinancing qualifications. However, it doesn’t offer a cosigner release option.
• MEFA doesn’t require a degree to qualify for refinancing, but you must’ve made at least one year of payments.

The Massachusetts Educational Financing Authority (MEFA) is a state-based, nonprofit loan organization. It was originally created by the state legislature in 1982 to help Massachusetts students and families access higher education opportunities. But MEFA now offers private student loans, refinancing loans and an array of resources and services to borrowers located anywhere in the U.S.

MEFA boasts that its refinancing customers have “on average reduced their interest rate by 28%”. But it also lacks some common refinancing protections found with other private lenders, like a formal program to temporarily pause payments during financial hardship.

Read on for our MEFA student loan refinance review, including available rates, terms and eligibility requirements.

MEFA student loan refinance review

Private, federal, undergraduate and graduate loans can be rolled into one easy-to-manage refinance loan with MEFA.

Here’s a breakdown of what to expect with MEFA’s refinancing loan.

Fixed APR	4.50 – 7.20%
Variable APR	4.50 – 7.20%
Terms	7, 10 and 15 years
Loan amount	$10,000 minimum
Cosigner release	No
Minimum credit score	670
Minimum gross annual income	$24,000

Pros and cons of refinancing with MEFA

Interest rates and terms should remain at the top of your refinancing decision-making list. But MEFA also offers the following refinancing benefits:

• Check your preliminary rate without impacting your credit score.
• No degree required to qualify. However, you must have made at least 12 consecutive, on-time payments.
• No loan fees. This includes no application, origination, late charge or returned check fees.

Unfortunately, MEFA doesn’t offer some of the most common perks and protections found with other refinancing lenders. Some of these include:

• No grace period. Payments (principal and interest) begin one month after loan disbursement.
• No option for deferment or forbearance. There isn’t a formal program, but you might be able to make payment arrangements on a case-by-case basis with its loan servicer, American Education Services.
• No option for cosigner release. Borrowers can apply to refinance without a cosigner in the future.
• No autopay discount available.

Eligibility requirements

Federal and private student loans currently in repayment are eligible for refinancing with MEFA. This specifically excludes loans that are still in a grace period, deferment or forbearance.

MEFA also requires that your loans must have been used at an eligible, not-for-profit, degree-granting college or university.

To be eligible for a MEFA refinance loan, you must:

• Be a U.S. citizen or permanent resident
• Be an existing borrower on all loans being refinanced
• Have an Experian credit score of 670+ or have a cosigner that meets this requirement
• Have a gross monthly income of $2,000 per month or $24,000 annually
• Apply to refinance at least $10,000

Additionally, you can’t have a history of default or delinquencies on education loans in the past 12 months. You also can’t have a history of bankruptcy or foreclosure in the past 60 months.

Application process

You can check your rate for a MEFA refinance loan online within minutes without affecting your credit. Keep in mind this is a preliminary rate, and it might change once you submit your refinancing application.

To complete MEFA’s full refinance application, you’ll need to provide the following documents and information:

• Proof of identity and Social Security number
• Current address, phone number and email address
• Financial information including monthly income, housing costs and employment information
• Two of your most recent pay stubs or other proof of income
• Current billing statements for all loans included in your refinance application

MEFA will run a hard credit pull to determine if you’re conditionally approved. You or your cosigner might then be asked to provide additional documentation before final approval.

Once approved, you’ll select a fixed or variable interest rate and e-sign your loan documents.

Should you refinance with MEFA?

Although MEFA offers competitive interest rates and a fast, easy online application, it also lacks many of the perks and protections that other refinancing lenders typically offer.

Because of the limited benefits, MEFA refinancing loans are best for borrowers who are confident in their job security and don’t foresee potential financial challenges in the future. It’s also a viable refinancing option for borrowers who didn’t finish a degree.

Otherwise, you might be able to find a student loan refinance lender that has more to offer in terms of interest rate reduction incentives and flexible repayment options.

Keep in mind that anytime you refinance your federal student loans, you’ll lose all federal benefits and protections. It’s important you weigh the pros and cons of refinancing before moving forward with MEFA or any other private lender.

We recommend shopping around with at least three refinancing lenders to get the best rate and terms. MEFA happens to partner with Credible, a refinancing comparison platform, which helps you quickly compare rates with competitors.

You can also check out our top refinancing lenders to see what makes each lender unique, including current refinancing cash-back bonus offers.

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