Tips on Consolidating Student Loans

LoanConsolidation.Ed.Gov – Do you want to Consolidate your Student Loans? There are some choices for student to consolidate their student loans to reduce debt. The numerous types of student loans are most commonly organized into two categories, which are federal and private loans. Over $60 billion a year is disbursed through federal loans, military compensations, work-study programs, and grants. Federal loans for students issued through the U.S. Department of Education are usually simple to consolidate.

Private loans are granted through lending institutions, such as signature loans through Citibank or Sallie Mae. These are often unsecured and have higher interest rates than do federal student loans. Additionally, private loans often begin to accrue interest while students are still in school, but federal loans often do not begin to accrue interest until after graduation.

Students can use federal and private loans along with scholarships and other types of financial aid to fund higher education, but when they want to consolidate their debt, they must consolidate federal and private loads separately. Students should consolidate federal loans first and then private. Consolidating loans can lower interest rates and increase repayment terms (the amount of time required to pay it off). Student loan consolidation can also eliminate the need to make multiple payments each month on different loans. LoanConsolidation.Ed.Gov

Almost half of recent college graduates have accumulated student debt. The average amount of student debt is around $10,000. Interest rates that used to be between 6%-8% have recently fallen to between 3%-4%.

What Are Some Options for Student Loan Consolidation?LoanConsolidation.Ed.Gov

There are several options for student loan consolidation in reducing debt. Lower interest rates mean that students could  consolidate or refinance their loans at a lower cost. However, students should research and compare interest rates before deciding to consolidate their loans.

Taking out excessive amounts of student loans or defaulting on loans reflects poorly on students’ credit scores, which may latter impact students’ abilities to purchase houses, cars, etc. Taking out more than 8% of their incomes in loans can affect students’ abilities to receive loans in the future.

LoanConsolidation.Ed.Gov – If you are interested in learning on Consolidating Student Loans, you aren’t alone! Just remember, there are many ways students can reduce their debt. For example, students can check into debt forgiveness plans offered by their fields, specialties, and careers. Debt forgiveness plans often include services or continued commitments. Reducing monthly payments could also alleviate the burden of student debt by making each payment more manageable. However, students should be aware that adjusting repayment terms can impact their interest rates. Consolidating Student Loans

Learn more regarding surviving graduate school & connect with other grad students at


The Advantages of Federal Student Loan Consolidation

LoanConsolidation.Ed.Gov – D0 you need information about Federal Student Loan Consolidation? Learn and understand about the risks and Advantages before you consolidate your student loans.

If you’ve been wondering lately “What is loan consolidation?” then you are in luck, because education loans are about to get a whole lot easier to pay off.

President Obama student loan proposals are now impacting college debt consolidation and federal loan repayment for millions of college graduates.

However, while the advantages of Federal Student Loan Consolidation are plentiful, so are the pitfalls. It is important for federal student aid borrowers to understand the risks and rewards when they need to consolidate their educational loan.

Advantage #1 – You will save time and money. No fees, simple paperwork process. No refinancing decisions based on your credit rating. The new program is reportedly available only from Jan. 2012 through June 2012 will also be offering a slight deduction for selecting the automatic debit option in repaying your loan. This not only helps you make timely payments, but it also helps reduce the amount of interest you’ll be charged over the life of your federal direct loan.

Advantage #2 – You may improve your credit score by avoiding default. Consolidating education loan debt could be the ticket to staying current and not defaulting on your financial obligations. These types of loans cannot currently be discharged for dismissed (except for loan forgiveness programs); not bankruptcy, not by hope and prayer. Not by ignoring the threatening collection agent letters. These loans must be repaid! So by consolidating, getting a smaller monthly loan payment, and sticking to a repayment schedule consistently, over time you will pay off your debt. Federal student loan consolidation then gives you a path to resolving your financial problems related to college debt. LoanConsolidation.Ed.Gov

Advantage #3 – You will avoid frustration by only having one bill to pay each month. Having to keep track of 2 or 3 different bills each and every month can seem daunting; so, by consolidating into a new federal loan consolidation program, you will not only lower your monthly bills. You’ll also lower the number of checks you will have to write and mail each month!

College was worth the price of admission. Your college degree opens many new doors to career advancement now and in the future. But now, repayment of those college loans looms large. And the new federal student loan consolidation program available for only six months by the U.S. Department of Education (Jan. 2012 – June 2012), could be the winning ticket to taking advantage of direct loan consolidation. LoanConsolidation.Ed.Gov

There are also disadvantages lurking around the edges of the new federal and private student loan consolidation programs: Some consolidation programs make you ineligible to get your loans forgiven if you later enter a qualifying career. Some federal loan consolidation programs exempt certain types of loans, and loans that were taken out at an earlier time period. Oftentimes, old loans carry a lower interest rate, so consolidating those at a higher level of interest makes no sense. Remember to compare options; your student loan consolidation rates should at the very least be better than you could  get from a private federal loan consolidation program.

But the U.S. Government’s Dept. of Education website now offers a variety of loan calculators aimed at helping college graduates have access to online tools aiming to help them compare loan consolidation packages and help them determine the best way for them to pay off college expenses. LoanConsolidation.Ed.Gov

The official website is undergoing a number of updates after President Obama’s student loan forgiveness plans came to light in the media. By providing comprehensive details on various ways to finance a college education, this website will ultimately offer yet another advantage to those seeking federal student loan consolidation.

While paying off these loans may never be easy, making the sacrifice and the commitment now to honor your loan commitments will pay off in other ways: You will earn the satisfaction of having followed through with one of your major financial commitments you made early in your adult life. And, you would demonstrate to yourself & to future creditors that you are an excellent credit risk.

LoanConsolidation.Ed.Gov -Therefore, the advantages of federal student loan consolidation are obviously a goal you’ll want to consider as you dig yourself out of debt.

 Steve J is a writer and publisher of, giving hundreds of free helpful articles on restoring good credit, debt reduction tips, and personal financial management. One of the most popular topics at includes free listings of student loan forgiveness programs to pay off college debts.

Consolidate Student Loans

LoanConsolidation.Ed.Gov – Are searching information on how to Consolidate Student Loans? The term consolidate student loans specifically means to use one larger loan to repay several smaller loans. This allows the student loan holder to have just one monthly payment to make. However, it is also possible to use student loan consolidation as a way of getting a lower interest rate on the loans you currently have.

What to Expect

Student loan consolidation allows you to enter into a new loan, with new terms and new interest rates. In general, the best situation is for you to have a significantly lower interest rate in the new loan than you had in the old loan. This will save you money monthly and in the long term. However, many people consolidate student loans simply to get a lower monthly payment. Most of these loans will have a longer repayment term (the number of years you need to repay the loan for) than the original loan.

Once you find a lender to consolidate student loans with, that lender will use their funds to repay each of your current lenders. The original lenders are no longer owed money by you. You now need to repay the new lender according to the new terms of the loan.

You are still obligated to repay your loan. Even if you consolidate from private lenders, you must repay these loans. Even bankruptcy will not forgive these loans. If you fail to repay this lender or the original lender, your wages could be garnished and assets seized by the courts, depending on the circumstances. consolidate student loans

Is Consolidation The Right Option For You?

If you have the ability to repay your loans as they stand, and you do not mind paying more than one lender each month, if this is the case, then consolidation may not be the right choice. It is important to keep in mind that the overall cost of consolidation can be higher in the long term than simply repaying the loan as it stands. However, if you can obtain a lower interest rate, you may save overall. LoanConsolidation.Ed.Gov

Where Do I Find A Lender?

Varieties of lenders offer student loan consolidation options. It is important to note, though, that each lender may offer a different loan for you. Some may offer lower interest while others may offer lower monthly payments. Compare the options you have to determine which the most affordable choice for your needs is.LoanConsolidation.Ed.Gov

You can use a debt calculator to help you to see the differences in loans. In addition, this is a good way to consider various term options. Some lenders may be more flexible in extending the repayment period than others are.

Before You Consolidate

LoanConsolidation.Ed.Gov – Before considering student loan consolidation, it is critical to decide if you need a lower monthly payment or if a lower interest rate is available to you. If either of these situations is true, spend some time considering several lenders and their offer. You may need to meet credit qualifications by some lenders to qualify for this process.

Jason Li

To find out more information regarding StudentLoansConsolidation, please visit Consolidate Student Loans.

All About Student Loan Consolidation

LoanConsolidation.Ed.Gov –  Consolidating student loans can reduce your monthly payments by up to 54 percent. Visit LoanConsolidation.Ed.Gov for an online calculator that will do all the calculation for you.

You might have heard a lot about student loan consolidation, but what is it really about? How can this help you ease your burden? Are there any disadvantages associated with applying for such? This article aims to shed light on these queries and help students, as well as their parents, on how to go about this whole process.

Loan consolidation means merging all your student loans into a single loan which has one repayment plan and is held by a single lender. You can have your current lender consolidate all the loans for you or have a different lender take care of this for you, depending on the terms and situation. A couple of lenders require the borrowers to have a least possible debt of $7,000 in student loans. A student that has completed their given educational program or close out education in their given program. LoanConsolidation.Ed.Gov

Another requirement for a student to participate is to have an eligible federal loan. However, it is not possible for private & federal loans to be consolidated together. A lot of limitations and standard procedures are placed upon this loan option, and these must be met for a student to make the cut. Students are advised to visit the National Student Loan Data System to look up into their credit history prior to making a decision relative to this process. LoanConsolidation.Ed.Gov

There are a lot of benefits associated with consolidating your student loans. Consolidation, for one, provides a fixed interest rate, and the borrower makes a single monthly payment to only one lender. Therefore, you will never miss out on a payment and you will only keep track of one bill. The interest rate is determined by obtaining the numerical mean of the interest rate of all the loans being consolidated and rounding up to the next one-eighth of one percent. The maximum interest rate is 8.25 percent (to take a look at your interest rate, you can visit LoanConsolidation.Ed.Gov for an online calculator that will do all the calculation for you).

How much you save by consolidating loans is subject to what interest rate you secured and in the event that you choose to extend your repayment plan. It is said that consolidating student loans can reduce your monthly payments by up to 54 percent. On the other hand, in order to reduce your payment this much is to extend the repayment plan. You actually have a minimum of 10 years to repay student loans, however you can extend your repayment plan up to 30 years depending on the tidy sum that you are consolidating. Keep in mind that if you decide to extend your repayment term, you will be repaying the loans for a longer period of time. Not to mention, an interest perk up might occur over an extended period of time. This increased interest rate could cause your overall balance to zoom its way by thousands of dollars, depending on your status. Good thing there are no prepayment penalties, so you can always choose to pay off your debts early.

LoanConsolidation.Ed.Gov – When taking care of student loans, loan consolidation or choosing a lender it’s indispensable to search high and low. You need to understand how the process works, and conceive the best decision based on the situation. If you are hesitant about a specific lender, you’re encouraged to contact the Dept of Education.

Elanora T. Kelly also writes some articles regarding debt forgiveness.