First Republic Bank was founded in 1985, basing its headquarters in San Francisco. Today, the bank has over 70 branch offices throughout the United States with branches in the California, New York, and Boston markets. First Republic offers private banking, wealth management services, and other business/investment services. To date, First Republic has around $90 billion in bank assets.
One of the private banking services offered by First Republic is student loan refinancing. Here’s a little more information regarding their product.
Refinancing Your Student Loan Through First Republic Bank
If you are a student loan borrower with excellent credit and high income living near a branch office, refinancing your student loan with First Republic Bank might make sense for you. First Republic has competitive interest rates, but the approval process is highly selective, hence the need for excellent credit.
In general, you’ll need to have a credit score in the upper 700s or higher in order to qualify for student loan refinancing. You’ll also need to have finished college and owe at least $40,000 in student loans. For those with a graduate or post-secondary degree, loan amounts start at $25,000. On top of this, First Republic considers borrowers who have at least two years of employment in the same industry. This is viewed as evidence of income stability.
Basic Information: Rates, Terms, Fees, & Limits
First Republic Bank student loan refinance offers low, fixed interest rates between 1.95 and 3.95 percent to borrowers who refinance (as of April 1, 2018). These are exceptionally low rates compared to other refinancing lenders and competitors.
However, there are other rates to keep in mind. For certain applicants, First Republic offers rates between 6.95 and 8.95 percent. These are offered to clients who cannot maintain automatic payments and direct deposit through a First Republic ATM Rebate Checking account. There are more details on this in the downside section.
As mentioned earlier, refinancing applicants must have at least $40,000 in student loan debt if they only have an undergraduate degree, and applicants are only able to refinance up to a maximum of $300,000.
Borrowers can choose loan terms of 5, 7, 10, or 15 years which is a fairly standard range of options.
When it comes to fees, First Republic claims that there are no origination or prepayment fees involved.
The most enticing benefit of refinancing student loans through First Republic Bank is receiving a very low interest rate. At 1.95 percent, borrowers have a chance to significantly reduce their rates. Today, federal student loan rates(often the preferred student loan option) hover around 4.45 or even 7 percent depending on the loan type.
In addition, the bank offers an attractive incentive to quickly pay off student loans. If borrowers can pay off their balance within four years of refinancing with First Republic, they are eligible to receive a rebate on the interest paid after refinancing. However, there is a limit; the benefit is capped at 2 percent of the original loan balance.
All First Republic Bank clients have access to personal bankers to help them not only with their student loan refinancing, but also with any other financial planning needs.
Finally, First Republic Bank can help families with parent student loans transfer those loans to their child as part of the refinancing process.
While there are benefits to working with First Republic Bank, there are a couple of downsides as well.
There are several barriers to entry. If you don’t have excellent credit or over $40,000 in student loan debt, then you are not eligible to refinance student loans with First Republic Bank.
Also, you must have a First Republic ATM Rebate Checking account in order to qualify for the lowest APR. Furthermore, you must link the account to your refinanced balance with automatic bill pay and direct deposit of your main source of income. If this can’t be done, then the fixed rates shoot to between 6.95 and 8.95 percent.
There are a couple of other pesky requirements regarding the bank account. The ATM Rebate Checking account requires an initial deposit of $500 to open, and there is a monthly $25 fee if the balance drops below $3,500.
While you can get a rate quote, get connected to a banker, and start filling out an application online, you’re required to meet with a banker at a branch office in order to complete the process.
Branch offices are concentrated in California, New York, and Boston markets with smaller offices in Palm Beach, Portland, and Jackson, Wyoming.
For the ideal applicant, First Republic Bank refinancing can be a great option. Some of the lowest interest rates in the market are offered, and they provide an attractive incentive to pay your student loans off in under four years.
Unfortunately, there are a few tough requirements that make this option less appealing. Aside from various barriers to entry, First Republic only offers its lowest rates to clients who have an ATM Rebate Checking account alongside other requirements.
Author: Kimberly Goodwin, PhD
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