We believe everyone should be able to make financial decisions with confidence. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. " There are two types of student loan consolidation: federal and private.
We’re on your side, even if it means we don’t make a cent.
The application process for student loan consolidation will depend on what type of loans need to consolidate.
Consolidation programs can make all the difference to a graduate struggling to repay their student loans.
As these loans are underwritten by private lenders they will have higher interest rates and stricter time limits than Federal loans.
Having said that, they are still a good way to reduce your monthly obligations to one manageable payments.
You’re generally eligible once you graduate, leave school or drop below half-time enrollment.
The government offers plans that cut payments to 10% or 15% of “discretionary” income and offer forgiveness on the remaining balance after 20 or 25 years. If you have a large loan balance and a low income, income-driven repayment is probably your best option for the lowest monthly bill.
But it’s only for federal loans, and it won’t cut your interest rate.
Consider federal consolidation if you: When you consolidate federal loans, the government pays them off and replaces them with a direct consolidation loan.
Benefits of federal loan consolidation include: Students who have private lender loans can also take advantage of loan consolidation programs.
Many private lenders offer attractive loan packages to make it easier for students to pay off their loans and avoid default.