Law Students

Student Loan Refinancing May Be Tempting but Also Risky
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Summary: One law school graduate explains how his decision to refinance his student loans for lower interest rates with SoFi was the worst decision he has ever made.

UPenn Law School graduate Josh Garber was looking for options when his student loans were becoming a burden. He had over $250,000 in debt and knew he needed a way out. Garber started looking around and found a better interest rate with online personal finance startup SoFi so he decided to refinance $80,000 of his loans. Garber has a warning for anyone else considering making the same decision he did.


He decided to take advantage of the better interest rate and other features of the program that mirrored federal loan programs such as allowing him to defer payments if they reached a percentage of his income.

Garber claims that SoFi has gotten rid of the loan program he was a part of so every few months he has debt collectors hunting him down to collect repayments he can’t afford. He works as a freelancer on the legal marketplace “UpCounsel” and was part of a panel for “gig economy.”

Garber explained his situation at the Self-Employed Entrepreneurs conference hosted in San Francisco by the California Association for Micro Enterprise Opportunity. He said, “One of my worst regrets is refinancing with a company like SoFi because the federal government has a thing such as income-based repayment.” The interest rate for the federal loan was higher than the rate SoFi offered but he would have been able to set an amount based on his income to make the payments doable.

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SoFi claims they never offered a program like the one Garber thought he was signing up for. They stated. “Student loan refinancing through SoFi puts money back in people’s pockets. On average, our members save $22,359 by refinancing their student loans with us over the life of their loan. If a member loses their job, we temporarily pause loan payments up to 12 months, and also provide help in a hob search.” They went on to explain, “We’ve never offered an income-based repayment plan, but we can offer members forbearance for up to 12 months if they can show us economic hardship. So incorrect to say we took away a program.”

When SoFi’s debt collectors become too fierce, he pushes back, reminding them that he is a lawyer. Garber said, “I’m an attorney, I know to complain. I think if I wasn’t I would just be toast at this point.” Garber strongly urges anyone considering refinancing their loans to stay away from lenders outside of the federal program. The interest rate may be better but in the end you could be hurt more.

Do you think student loans are worth it? Tell us in the comments below.

To learn more about student loans, read these articles:




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