Splash Financial Review
Splash Financial is a relative newcomer in the student loan refinancing world. The company was launched in 2013, and its founders were motivated to develop a client-friendly solution after seeing friends and loved ones struggle to manage the burden of high student loan debt. Splash Financial achieves this through a partnership model that gives banks and financial institutions a strong incentive to offer their most competitive refinancing rates and terms through the platform.
How it works
The company offers two main programs: general student loan refinancing plans, and specialized options for students in medical school. Both programs use a similar approach built around the same core steps.
- Use the Splash Financial estimator tool to enter your loan details. The system will then generate quotes for your new interest rates and payment terms.
- Lock in the quoted rates and terms by completing and submitting a formal application.
- Finalize your refinancing plan by authorizing and signing your loan documents.
- Make your scheduled monthly payments until you are debt-free.
The key difference between the two programs is that medical school students qualify for special terms. For example, they can have their loan payments capped at just $100 per month while they are engaged in study fellowships or hospital residencies.
Student loan refinancing options
Splash Financial partners with banks and credit unions, functioning as a marketplace that links borrowers with the best rates they qualify for. Here’s a snapshot of what you can expect to find as a Splash Financial customer, as of July 2020:
- Loan types: Refinancing plans for student loans and medical fellowships and residencies
- Minimum loan amount: $5,000
- Maximum loan amount: No maximum
- Repayment periods: 5 years, 7 years, 8 years, 10 years, 12 years, 15 years, and 20 years
- Interest rate types: Variable and fixed
- Variable-rate loan rates: 1.89% to 5.99%
- Fixed-rate loan rates: 2.63% to 6.25%
One noteworthy policy is that Splash Financial imposes a cap on its variable rate loans. Variable rate loans are, by nature, unpredictable and their rates change according to prevailing economic conditions. However, Splash Financial introduces a helpful element of predictability by guaranteeing that no variable rate will ever exceed a 10% annual percentage rate (APR).
How to qualify
Splash Financial customers must meet several general qualification guidelines to be eligible for the service. These include:
- You must be a U.S. citizen or documented permanent resident with a valid visa
- You must have attended an institution that is authorized to participate in the U.S. federal government’s student financial aid program
- You must have graduated from a degree program, or be in the final stages leading up to graduation in the imminent future
- You must have earned at least a bachelor’s degree (some exceptions apply to students who earned associate degrees in healthcare-related fields)
Beyond these standards, you must also meet the following financial criteria:
- Solo borrowers must have a FICO credit score of at least 660, which represents the high end of the “fair” range
- You must have a verified income of at least $3,000 per month or $36,000 per year
- Your debt-to-income ratio must not exceed 35% to 50%, depending on your current student debt load, your income, and your future earning potential
Finally, keep the following additional factors in mind:
- If you have ever declared bankruptcy, of if your FICO credit score is below 660, you must apply with a co-signer who has a bankruptcy-free credit record
- The average FICO credit score of a Splash Financial customer is 773
- Customers with higher credit scores qualify for lower interest rates and more advantageous repayment terms
- Residents of all 50 U.S. states are welcome to apply
When you use Splash Financial to obtain a rate quote, the company performs what is known as a “soft pull” of your credit file. This means that your credit score will not be negatively impacted by your loan application, which removes a great deal of risk to potential borrowers. You have nothing to lose by applying.
Things to know before you apply
As with any other major financial decision, you should always shop around and compare the rate quote you obtained from Splash Financial against your other options. Splash Financial offers some of the most competitive rates on the market, but even so, personal finance experts universally stress the importance of doing your due diligence by considering multiple lenders.
Also, remember that your government-issued student loans will become private loans as soon as you refinance them through a third-party institution like Splash Financial. Federal borrowers enjoy certain advantages with regard to forbearance, payment deferrals, and loan discharges due to death or disability. These become void when you privatize your loans.
If you have any questions about Splash Financial’s forbearance, deferral, and discharge policies, get them answered before you apply. Splash Financial appears to consider such requests on a case-by-case basis.
Pros and cons of Splash Financial
Professional reviewers and real Splash Financial customers cited the following advantages of the company’s refinancing model:
- You can explore your refinancing options without committing or damaging your credit score
- The company offers some of the lowest rates and most flexible repayment terms on the market
- Borrowers do not have to pay any application fees
- Prepayment penalties do not apply, so you can pay off your loans early without incurring any extra charges
These advantages were tempered by drawbacks and downsides that include:
- You must have a credit score of at least 660 to qualify for a solo loan
- If your best offer comes from a credit union, you may need to join the union to qualify for the rate
- Loan rates and repayment terms vary among lenders, with wide variance in some situations
- Deferrals, forbearances, and loan discharges due to disability or premature death may not be available to all borrowers
On the whole, customers have very positive things to say about Splash Financial. As of July 2020, Splash Financial was accredited by the Better Business Bureau (BBB) and had an A+ rating. On Trustpilot, Splash Financial had an aggregate score of 4.4 out of 5, with 88% of reviewers giving the company a score of 4 out of 5 or better.
Splash Financial offers some of the lowest interest rates and most flexible repayment terms of any student loan refinancing marketplace. The company certainly merits close consideration if you qualify. It is especially useful for medical students, students managing high levels of debt, and borrowers who want to maximize their options by comparing quotes from multiple lenders.
Splash Financial is headquartered at:
812 Huron Road East,