Consolidation simply combines multiple student loans into one. That means one monthly payment instead of having to juggle many different ones, sometimes with multiple loan companies. When you consolidate, your interest rate will be a weighted average of the interest rates on the loans you combine. You won’t save money on interest rates — but it can make life easier by reducing the amount of time you spend managing different payments.
Refinancing can be done with one loan or several and involves getting a new loan with a different (usually lower) rate than before, due to changes in your financial situation. When you refinance, you typically work with a company to pay off the original loan(s) and get a new unified loan at a lower rate.
At Earnest, many of our clients refinance multiple loans within one application, essentially creating a consolidation and refinancing at the same time. During our loan acceptance process, we'll ask you the lender(s) we'll be paying and how much money to send their way. The end result being one Earnest loan with one monthly payment.