Why You Should Consider Student Debt Consolidation Loans

Why You Should Consider Student Debt Consolidation Loans

by Adam Hefner

You're living in a small apartment, driving a used car, and working harder than you ever imagined possible. Despite all of your sacrifices, you're still struggling to meet your monthly payments for all of those student loans. The solution to regaining control is student debt consolidation loans.

By taking out a new loan, with an unbelievably low interest rate, you can pay off all of your existing student loans. This leaves you with a single monthly payment that's formed to fit your budget.

If you have federal student loans, you can qualify for a federal based consolidation loan. These are supplied by the government and issued by private lenders. It's free to set up, there's no credit check, and you don't need a co-signer. A weighted average of your current rates determines the new interest rate you'll be paying. You can save up to 60% each much by doing this.

If you don't qualify for the federal consolidation loan, you can still use a private consolidation. With this option, you'll need a credit check and there will be associated fees and charges. However, you can use a co-signer if you don't qualify on your own. There's often a low fixed rate the first year, followed by a competitive variable rate. This has the potential to save you 45% in the first year.

Basic qualifications are clear-cut. Your existing student loans must not have been previously consolidated. Also, you cannot be enrolled in school more than half time. Finally, the loans must be in either grace or repayment periods.

You even have the freedom to set up your payment time frame. To avoid paying more from interest, you can pick a shorter payment plan. However, if you've been having a hard time making ends meet, and have a lot of debt, a longer plan would be best. You can extend your term up to 30 years, making monthly payments very affordable.

By consolidating your student loans, you'll have more money available. You can focus on paying off other debts you may have. You can even start saving money and investing. Once you realize how much money you were spending each month on multiple student loan payments, you'll wish you had consolidated sooner.

Regardless of your financial situation or your goals and dreams, student debt consolidation loans are a great tool. You shouldn't have to work hard and still end up worrying about making multiple payments. Do yourself a favor and consolidate your student loans.

Student Debt Consolidation Loans

Student Debt Consolidation Loans

by Jonesh Taylor

Here you will find all the information about student loans with debt consolidation. What is student loans debt consolidation here is a information for you. If you are a student and you are facing many financial problems and your study is not going well then consolidate your student loan into one. You can consolidate your federal student loans too, but make sure that you do not consolidate both your federal student loans and private student loans into a single student loan debt consolidation program. If you are planning to consolidate your student loans then you must have a minimum balance of $5000 in your account and you must either be in the six-month grace period after your studies, or are already repaying your student loan. Here you will find all the advantage as well as disadvantage of the student debt consolidation loans. The first thing is that when you are going to consolidate your student loans then make sure your student loans payments to a single lender. Your consolidated student loan has an extended repayment term from 10 to 30 years, depending on the balance of your loan amount. When negotiating with your bank or financial institutions, ensure that your phased repayment plan allows you to easily meet your monthly payments and have a good credit rating, at the same time. Once the rate is fixed you cannot take advantage if the interest rates fall in future. There are no fees charged for student loan debt consolidation. Once approved, you cannot undo your debt consolidation of your student loans as they have already repaid in full to your previous creditors, and they no longer exist. You can still obtain debt consolidation for your over due, or unfulfilled, student loans if you negotiate a satisfactory repayment plan with your bank, or debt consolidation lender. Married couples, too, can consolidate their individual student loans together. This is regardless of how much each owns before consolidation, and must now agree to pay the consolidated amount. You are eligible to go for your Student Debt Consolidation Loans of your Federal loans when you are not enrolled in school any longer; you are actively repaying your loan or are in your six-month post-graduate grace period; you have a minimum loan amount of $10,000. Student Debt Consolidation Loans makes you lose all the benefits of the Federal loans consolidation.

Do Student Debt Consolidation Loans Really Solve Debt Problems?

Do Student Debt Consolidation Loans Really Solve Debt Problems?

Student debt, if not restricted, can badly harm your credit. Your future financial life might be put into jeopardy by accumulated debt. Though it may sound an exaggeration today, you may be losing your ability to get finance in the years to come because of today financial decisions.
This is the main reason why financial transactions must be taken seriously. You can not go through life spending money you do not own without limits. Eventually the credit fountain will go dry and you will have to change your spending habits, so you might as well start today and avoid the costs.

Student Debt Consolidation Loans

Student loan consolidation might be the solution to your student debt problems. Surely you have heard about these loans that are granted in order to repay the outstanding student loans and lift the burden from your shoulders or at least reduce your monthly payments. But, does it really work? The answer to this question is far more complicated than a mere yes or no.

When Are Consolidation Loans Effective?

The value of student debt consolidation loans depends on the amount and type of student debt you hold. Since student debt consolidation loans tend to reduce student debt by lowering the interest rate charged on the principal, their functionality depends on the average interest rate you're being charged for your outstanding debt.

If you student debt consists on mainly federal student loans, you will hardly find a debt consolidation loan featuring lower interest rates. Federal student loans are provided by the US department of Education and thus are granted with no profitable terms. The interest rate charged is destined to cover administrative costs only.

Even if part of your student debt are federal student loans, you should leave them aside when consolidating, otherwise you will end up paying more interests on the principal and debt consolidation will not be worthwhile. You can try some federal programs to consolidate government loans or at least reprogram your repayment schedule to make it be gentler on your budget.

Student Debt Consolidation Loans become really effective if your student debt is mainly composed of private student loans. If you add up to this all your credit card balances, you can really get a wonderful deal by consolidating your debt. You can reduce your average interest rate by up to 5 points and you will end up saving thousands of dollars.

Summing Up

When it comes to student debt consolidation, you need to make sure you will save money by reducing the interest rate or at least, your monthly payments will be reduced by extending the repayment program of your loans with the new student consolidation loan. What you seek is to lighten the heavy burden of debt that will otherwise ruin your credit, so make sure that by the end of this financial transaction you will end up agreeing to monthly payments you can easily afford and commit to. If you make a conscious and well informed decision you will find yourself debt free in just a few years.