When it comes to paying for your college education, it might be a wise choice to consolidate loan payments as graduation approaches. College is not a cheap process, and it is getting more expensive each year for students.
Many individuals must take out loans from national lenders and private banks in order to pay for their education. When a student finally reaches the end of his or her college career, finding a way to pay off student loan debt can be extremely difficult.
Many federal loans can be consolidated into one student loan payment. Two of the most common loans students apply for and use are Stafford loans and Perkins loans. However, if you decided to take out private loans to pay for college, then you won’t be able include them in a federal student loan consolidation program.
Private loans are not under the same federal restrictions as federal loans, and students should never include their private loans in the same federal student loan consolidation program.
Once you know if you can consolidate your student loans, you should start to shop around for lenders. Several national lenders help students consolidate loan payments, such as Next Student or Loan Approval Direct.
It is very important to compare several lenders because each one will offer different loan terms and interest rates. Because the federal government regulates the interest rates for federal loans, students are able to get a lower interest rate when choosing to consolidate student loans.
When you choose a lender and apply for their student loan consolidation program, you will end up combining all of your student loan debt into one monthly payment. By going through this process, you can lower your payments by close to 60 percent, depending on the lender.
Not only will you have one simple payment to make, but also you will only have to deal with one lender instead of several. The only downfall when you consolidate student loans is your payment plan may run longer due to the fact you combined several payments.
There is plenty to worry about as you prepare to finish your collegiate education. You need to find a job, pack up all of your belongings, and, oh yes, graduate! The last thing you need is more mental baggage, especially financial in nature.
Choosing to consolidate loan payments will make your student loan debt payments easier. You may even end up saving a good deal of money.