What Is Consolidation
What is Consolidation?
Consolidation allows you to simplify the repayment process by combining several types of federal education loans into one loan, so you make just one payment a month. Also, that monthly payment might be lower than what youre currently paying.
You can get a Direct Consolidation Loan, available from ED, or a Federal (FFEL) Consolidation Loan, available from participating FFEL lenders. Under either program, the loan holder pays off the existing loans and makes one Consolidation Loan to replace them. If you have subsidized and unsubsidized loans, theyll be grouped accordingly when you consolidate so you wont lose your interest subsidy on the
subsidized loans.
There are three categories of Direct Consolidation Loans: Direct Subsidized Consolidation Loans, Direct Unsubsidized Consolidation Loans, and Direct PLUS Consolidation Loans. If you have loans from more than one category, you still have only one Direct Consolidation Loan and make only one monthly payment.
Under the FFEL Program, you can receive a Subsidized and/or an Unsubsidized FFEL Consolidation Loan, depending on the types of loans you're consolidating. (FFEL PLUS Consolidation Loans are included under the Unsubsidized FFEL Consolidation Loan category.)
You can also consolidate Federal Perkins Loans and other federal education loans. To get a complete list of the kinds of federal student loans that can be consolidated.
* contact the Direct Loan Origination Centers Consolidation Department if youre applying for a Direct Consolidation Loan. You can reach them by calling
1-800-557-7392. TTY users can call 1-800-557-7395.
* contact a participating FFEL lender if youre applying for a FFEL Consolidation Loan.
Under FFEL consolidation, if the same holder holds all the loans you want to consolidate, you must obtain your consolidation loan from that holder, unless you havent been able to get a loan with income-sensitive repayment terms.
To get a Direct Consolidation Loan, you must consolidate at least one Direct Loan or FFEL. If you don't have a Direct Loan, but you have a FFEL, you must first contact a FFEL lender that makes FFEL Consolidation Loans to ask about obtaining a FFEL Consolidation Loan. If you can't get such a loan, or you can't get one with income-sensitive repayment terms acceptable to you, and you're eligible for the Direct Loan Income Contingent Repayment Plan, you can apply for a Direct Consolidation Loan.
Even if you're in default, you might be eligible for a Consolidation Loan if certain conditions are met. Talk to your loan holder(s).
Private Loans - Student Financial Aid
Those who have a bad credit record will find it very difficult to get out of debt.
Bolån Till Hus i Thailand Loans & Other Subjects
Then you have the convenience of extending the period of repayment to 30 years (conditions apply) which can be a life-saver for those who scratch through with their daily living expenses.
Student Loan Debt Relief - School Loan Consolidation
By Ivar Rudi
Student Loan Debt Relief - School Loan Consolidation
In order to relieve some of the financial burden associated with furthering their educations, many students are opting to consolidate their debt at lower rates, and getting a longer period of time to repay. The following paragraphs will answer some commonly asked questions about the subject, as well describe how it can aid in debt relief.
What Is Student Loan Consolidation?
It is the act of combining your school loans into one in order to help manage your financial burden caused by college or trade school. When you consolidate you will only have one monthly payment to make, which is usually lower than your combined monthly payments of your unconsolidated loans. This is possible because when you consolidate, you are generally offered a longer time period to repay - sometimes up to 30 years. Many consider the lower payment a huge benefit, which it is, but it can also cause you to pay more interest, over a greater length of time, than you would with your combined unconsolidated student loans.
The rates are generally lower, and most often the rate will be fixed. With unconsolidated loans, most commonly the interest rates are variable, which means they can change at any time, sometimes without much warning. With a fixed rate, the monthly interest will remain the same throughout the entire duration of your consolidated loan.
What If I am Default on My Student Loan Payments?
If you are default in making your payments, you may still qualify. It is important to check with your debt holder, to ensure your defaulted loan has not been subject to wage garnishment. If your defaulted debt is subject to wage garnishment, you may not be able to consolidate.
How Can I Obtain More Information Regarding School Loan Consolidation?
There are many ways to obtain more information regarding this issue including:
by requesting it from the financial aid office at school
by requesting it from the holder of your original student loan
by researching the internet
Information is usually available in any financial aid office of any learning institution. If you cannot get to your financial aid office, or if your financial aid office does not have the information you need, please request the information from the holder of your original loans, or search the internet for valuable information on the subject.
Knowledge is the key in finding the best rates available. The more knowledge you have on the subject, as well as knowing your credit scores, the better your chances of getting a good interest rate when consolidating your loan.
Copyright 2006 - Ivar Rudi. Ivar suggests you find great market for less by shopping online today. For more information and resources check out: http://www.consolidate-student-loan-guide.org/
Is Student Loan Consolidation Good?
By Ron King
Consolidating your student loan(s) is one of the smartest things that you can do. You should consider a student consolidation loan if you have several federal student loans or even just one large one.
Student consolidation loans will have fixed interest rates which are similar to those of the loans that are being consolidated. The amount that you can save through consolidation can be up to 58%.
Federal Stafford loans, Federal Direct Loans, Federal Perkins Loans as well as many others can be consolidated. Most of the time, they already have low rates.
Advantages
- You will have a single loan payment which is often lower than what you currently pay.
- It is easy to set up.
- It will help lower your debt burden.
- You can secure the lowest interest rate at the time.
- It can help you qualify for new or renewed deferments.
What To Consider
When you consolidate, make sure that the interest rate that you are offered is lower than your current rate. You want to pay off your student debt easier and maybe quicker too.
While consolidation can simplify the loan repayment process and lower your monthly payment, in the long run it usually increases the total amount that you will have to pay.
Student loan consolidation provides lower monthly payments by allowing you to spread the loan over 30 years in some cases. You are paying more payments, so be sure to compare the total cost of repaying your unconsolidated loans with the cost of repaying them through the consolidation loan.
The process of consolidating is very flexible. Consolidation is available from before you graduate down through years of repayment.
First, you need to gather information about your current loan. You need to know the balances and the interest rates, the names and addresses of companies and the names and addresses of personal references. The National Student Loan Data System can help provide you with the information that you need since it holds the most complete and accurate information for federal loans.
Paying Them Back
You will have 2 options to pay these loans back.
1. Pay a standard amount each month. This will include principle and interest. This is the lowest cost of interest paid way to go.
2. Or a graduated repayment. Here you start with lower payments that are only interest, but then they will keep increasing.
Usually repayment of your consolidation loans will begin in 60 days and will take from 10 to 30 years to fully pay back.
There are some questions that you should ask the lender before going forward.
- is there a rate reduction, for example for making your payments online or on time?
- does the loan meet your specific needs?
- is that the best interest rate available?
To get a student loan consolidation, you can still be enrolled in school or graduated. Either way, you'll find many lending options that will fit your needs.
Visit Consolidate loan for more. Ron King is a researcher, writer, and web developer, visit Articles for authors. Copyright 2006 Ron King.
Other Loan Consolidation Article Snippets:
Understanding The Student Consolidation Loan Application Process
"You can avoid financial crisis if you take care that:If you follow the above guidelines you will be unlikely to really get into financial trouble."
Student Consolidation Loan Information Sources - Where To Find Them
"Most consolidation loans that you take are subject to locked interest rates but some do constantly change with the market, always search around carefully and ensure that you get any consolidation loans which have locked rates for the term."
Student Loan Repayment Plan
"It is not always as difficult as you may think, while it is true that obtaining a secured loan is normally easier, some dont have a home to secure the money against but dont despair, there are plenty of companies that can help you get that all important unsecured debt consolidation loan."
The Business Debt Consolidation Loan Is The Same As Other Consolidation Loans
"It is common for you to obtain an excellent rate on a loan which starts from about 1% and, as this will lower your monthly repayments by combining all debts, getting such a great interest rate will mean cheaper repayments for the entire term of the loan."