Loan Consolidation allows students and parents to consolidate their loans into a single loan with more manageable payments. Sometimes the payment on the consolidated loan will be smaller.
Even if you have one loan you can still consolidate it. Loan Consolidation is helpful if you run into trouble paying off your loan or when you have too many monthly payments and you want to
reduce it all into one payment.
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Apply Now for Loan Consolidation |
With only one lender and one monthly bill, it is easier than ever for borrowers to manage their debt. Federal Student Loans
and Private Loans can be consolidated.
US Department of Education provides loan consolidation for their loans and private
lenders provider consolidation for theirs. Note, private and federal loans CAN NOT be consolidated together.
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Federal Consolidation Loans
Both Direct Loans Program and
Federal Family Education Loans (FFEL) Program offer consolidation loans.
Loans Offered By Federal Programs
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Private lenders and other none federal lenders offer loan consolidation. The idea is the same; to simplify and minimize loan payment.
To apply for federal or private loan consolidation the borrower must contact the lender and complete an application. Most lenders provide borrowers with the ability to apply
on-line or request an application over the telephone.
Both students and parents can apply with their loans. Loan Consolidation can merge Student Loans and
Parent Loans together into one loan. This could help one to eliminate debt from their
credit history and remove over leverage leaving space for other loans.
Single Payment As Oppose to Many
Single Lender As Oppose to Many
Smaller Monthly Payment
Lower Interest Rate Possible
Less Fees Due To Less Payments
Possible To Remove Debt From Your Parents And Apply It To You
Possible To Remove Debt From You And Apply It To Your Parents
Can Increase Your Credit Score
When You Or Your Parents Know There Will Be a Problem Paying Off Current Loans
When You Or Your Parents Are Going Into Default
When You Or Your Parents Are In Default Already
When You Have More Than One Payment
When Loan Interests Come Down
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Important Questions |
Q: Are your monthly payments manageable?
If you have trouble meeting your monthly payments, have exhausted your deferment and forbearance options, and/or want to avoid default, a consolidation loan may help you.
Q: Too many monthly payments driving you crazy?
If you send payments to more than one lender every month, and want the convenience of a single monthly payment, consolidation may be right for you.
Q: What are the interest rates on your loans?
If you have variable interest rates on your Federal education loans, you may want to consolidate. The interest rate for a Direct Consolidation Loan is fixed for the life of the Direct Consolidation
Loan. The rate is based on the weighted average interest rate of the loans being consolidated, rounded to the next nearest higher one-eighth of one percent and can not exceed 8.25 percent.
Q: How much are you willing to pay over the long term?
Like a home mortgage or a car loan, extending the years of repayment increases the total amount you have to repay.
Q: How many payments do you have left on your loans?
If you are close to paying off your student loans, it may not be worth the effort to consolidate or extend your payments.
Q: Are there any cons consolidating my loans?
Yes. You have to review your options very well. Consolidating can increase the overall cost of your loan. The requirements can be tough. Consolidation does not have to be the best deal under
the sun. There are other programs available to help you repay your loans or have them forgiven.
Q: Can borrowers currently enrolled in school consolidate their loans?
The Higher Education Reconciliation Act of 2005 eliminated the provision that allowed a Direct Loans Program or
Federal Family Education Loans (FFEL) Program borrower who is enrolled in school on at least a half-time
basis to request to enter repayment early on his or her Federal Student Loans if the lender approves. Repayment is now defined
as not beginning until 6 months and one day after the date the student ceases to carry at least one-half the normal full- time academic workload, as determined by the school. Therefore, a
FFEL or Direct Loan borrower who is still enrolled in school at least half-time may no longer request to enter repayment early to apply for a FFEL or Direct Consolidation Loan.
View All Questions
Consolidation loans help you manage your current Student Loans. Both Students and Parents can consolidate their payments.
Federal Student Loans and Private Student Loans
can be consolidated. Contact your lender about your loan if you need it to be consolidated.
We advise our financial aid candidates to use our tools below and see how much college is going to cost, how to plan or save for college, how to find financial aid, and calculate
loan amounts.
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Related Resources
Loan Consolidation FAQ
Loan Consolidation Glossary
Loan Consolidation Facts
Loan Consolidation News and Articles
Loan Consolidation Discussion
Loan Consolidation Questions
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