Refinancing trades federal protections for a lower rate. We show you the exact month savings overtake what you forfeit, plus year-by-year cumulative math.
Your loan situation
$120K
7.05%
What you actually pay today (Standard, IDR, or otherwise).
$1.4K
Pre-qualified rate from a private lender.
5.50%
Your break-even math
VERDICT
Calculating...
Break-Even
Month 0
When refinance savings overtake forfeited federal protections.
New monthly payment
$0
Refi monthly
Monthly savings
$0
Vs current payment
Total interest saved
$0
Over refi term
PSLF opportunity cost
$0
Forgiveness forfeited
Cumulative net benefit: Refinance vs Keep federal
Refinance cumulativeKeep federal cumulativeBreak-even
Estimates use simplified amortization and projected PSLF / IDR forgiveness. Actual outcomes depend on refinance lender terms, federal policy changes, IDR recertification, and your future income. Refinancing federal loans is irreversible. Verify everything with the lender and a qualified loan advisor. SAVE plan availability is subject to ongoing federal litigation. This tool is informational, not financial advice.
What "break-even" actually means
If you keep federal loans, you preserve PSLF eligibility (forgiveness after 10 years at a qualifying employer), IDR (income-based payments), and federal protections (deferment, forbearance, death/disability discharge). If you refinance, you lock in a lower rate and pay off faster, but lose all of those federal options forever.
Break-even is the moment cumulative refi savings exceed cumulative forfeited federal benefits. Before break-even, refinancing is the worse deal. After it, refinancing pulls ahead.
For PSLF-eligible borrowers, break-even often never occurs. The forgiveness math is too valuable. For non-PSLF borrowers with strong credit, break-even can be as fast as month 6 to 18.
How we model the trade
Refinance net = (Current monthly payment minus refi monthly payment), summed month-by-month over the term, minus 3% origination/closing cost (if applicable).
Keep federal net = expected forgiveness benefit. For PSLF-eligible: remaining balance after 10 years of payments, treated as forgiveness recovered. For non-PSLF on IDR: lower payment savings, optionally minus tax bomb at year 25.
Subtract the two paths to find the break-even point.
The three verdicts
Refinance now. Strong credit, no PSLF possibility, and refi rate is 1+ point below your federal rate. Expected break-even within 24 months.
Keep federal. PSLF-eligible or planning IDR. The forgiveness value far exceeds the rate savings. Refinancing is a one-way door away from a great deal.
Wait until PSLF certified. You think you might pursue PSLF but are not yet sure. Submit a PSLF Employment Certification Form, get a qualifying-payment count established, then re-evaluate in 12-24 months. Until then, do not refinance.
Frequently asked questions
What is the actual cost of giving up PSLF?
For a $120K balance at 7% on a $130K NP salary with 1 dependent, SAVE plan + 10 years of qualifying payments + tax-free PSLF forgiveness can be worth $80,000 to $130,000 in present-value terms. Refinancing for a 1-point rate drop saves $10,000 to $20,000. The math does not survive contact.
Should I just refinance my private loans?
Yes. Private loans have no PSLF or IDR to forfeit. Refinance them annually if rates drop. Keep federal loans separate and on the most generous federal program you qualify for.
Can I refinance back to federal later?
No. There is no path from private back to federal. Refinancing federal loans is permanent. Treat the decision accordingly.
What about variable-rate refi offers?
Skip them unless you can pay off in under 3 years. Variable rates start lower but reset. With your loan balance and time horizon, the savings from a variable rate rarely justify the rate-rise risk.