When first-time homebuyers get ready to purchase a house in North Dakota, Realtors may start handing them information on refinancing student loans as well.
The Bank of North Dakota is partnering with realtors to get the word out about its DEAL One loan program.
Eric Hardmeyer, president of BND, said national reports have shown students graduating with an average of $27,000 to $30,000 in student loans.
“We know they’re delaying major life decisions because of student loan debt,” he said.
Hardmeyer said, in meetings between BND’s student loan and home loan staffs, the housing lenders were seeing the student loans as a barrier to housing loan approval. Those meetings led to an “aha moment.”
“There’s something we can do here,” Hardmeyer said of the conclusion.
A person with a 14 percent interest student loan can refinance it to less than 2 percent interest today with a variable interest loan.
“It’s just huge savings,” Hardmeyer said. “In some cases, it’s a life changer.”
He said, on average, people are refinancing $40,000 worth of student debt at BND. And the average interest rate on the debt was 8 to 9 percent. BND also allows them to stretch payments out from 10 years to 20 or 25 years, which lowers their monthly payment and allows them to get into a home sooner if they choose.