Is A Student Loan Consolidation Or Federal Student Loan Consolidation Right For You?
Today’s career minded students can get help with the burden of having several student loans. One can focus on their chosen career, instead of losing sleep over paying several monthly student loan payments. Student loan consolidation and federal student loan consolidation can be the solution with several benefits.
How Does Student Loan Consolidation Work?Here is typically how a student consolidation loan works. When a student first applied for several loans from several different agencies and student loan providers, they each gave a different interest rate and term for paying back the loans.
The idea of student loan consolidation, is to take all the different student loans and put them into one easy convenient loan. You then only have to make one monthly loan payment every month, instead of several loan payments every month over time.
This saves the student both time and money. Having a lower interest rate and less checks to write every month are a couple of the many bebefits of doing a student loan consolidation or federal student loan consolidation.
What About Federal Student Loan Consolidation?There are several advantages when you get a federal student loan consolidation. You can take advantage of fixed interest rates, lower monthly payments, one payment each month, get payment incentives and new or renewed deferments.
There is usually not a minimum loan balance required with this type of loan program. Also, you have the option of which loans you may want to include and money saving payment incentive plans with some federal student loan consolidation programs.
Another benefit is that you can consolidate your undergraduate loans if you are still in graduate school. You can decide on what loans you want to consolidate from the loans that qualify.
However, federal student consolidation loans can’t include loans you may have received from banks, credit unions, personal loans, consumer debt loans or any other type of financial service loans you may have applied for in the past. They have to be federal student loans to qualify.
8 Helpful Benefits From Student Loan Consolidation1. Lower Monthly Payments. Depending on your student loan situation and the type of lender you choose, you may be able to lower your monthly payments by up to 50%2. Having Simple Loan Payments. By consolidating your student loans, you only have one loan payment per month and one check to write. This is very beneficial if you are writing several checks every month to multiple lenders.