Federal Consolidation Student Loan - 5 Tips

Being a student in a higher educational institution is a rich and rewarding experience. It is also a privileged one: only a small percentage of the world's population has the opportunity to go to college or graduate school.

With that privilege comes responsibility. Part of the responsibility that comes with higher education is that of paying for the education itself. Some lucky students enter college, study for a few years, and then graduate without ever having to pay a dime of their own money or take out a loan. However, for the majority of students, attending college requires taking out one or more student loans.

The responsibility for making student loan payments begins not long after graduation, when the grace period ends. Student loan payments can be a heavy burden, especially for recent grads who have not yet had the chance to get a high-paying job but who still must keep a roof over their heads and pay for food. It can make money very tight.

For graduates who hold multiple student loans, loan consolidation can significantly reduce the amount of their monthly payments. How does it work? It's pretty simple: by consolidating their loans, students can stretch out their payments over more years than their current loans allow.

For example, their current loans may have repayment schedules of 5 or 10 years, whereas with consolidation they can stretch out their payments over 30 years. Doing so will definitely bring down the monthly payments they have to make.

Federal Versus Private Loan Consolidation

If you are interested in consolidating your loans, you will need to first determine whether you should apply for federal or private consolidation. Put simply: if your existing student loans are federal loans, you should apply for federal consolidation. Otherwise, private consolidation is what you need to pursue.

If you are wanting a federal consolidation student loan, here are 5 tips that can help:

1. Decide Whether To Consolidate:

First, decide whether it makes sense to consolidate at all. For example, if you are more than half-way through repayment of your existing loans and are able to make monthly payments, consolidation may not make sense.

2. Take An Account Of Your Existing Loans:

If you believe consolidation is the right path for you, start by taking stock of where you are now. Write down all of your student loan balances and interest rates. This is important because the interest rate for your new federal loan will be a fixed rate and it will be calculated by taking the weighted average of the rates of your existing loans.

3. Determine Whether You Qualify For A Federal Consolidation Loan:

Check out the U.S. Department of Education website to find out which federal student loans qualify for consolidation.

4. Figure Out The Repayment Period You Want:

Since your interest rate will be determined for you based upon your existing loans, the most important strategic decision you can make in the consolidation process is that of choosing the right repayment schedule (e.g., 10 years, 20 years, etc.) for you. In general, your rule of thumb should be to choose the shortest possible repayment period while still leaving you with manageable monthly payments.

5. Fill Out An Application:

Finally, fill out the federal student consolidation loan application and start on the road to approval.

Federal consolidation student loans are a snap if you take the right steps. The end result could be a very significant reduction in your monthly loan payments.

Essential Student Loan Consolidation Rules and Regulations You Should Know About

When consolidating student loans, it's important to know what you're getting into first. As with any financial decision, you must do your homework before signing on the dotted line. Consolidating student loans is not a difficult process, but there are several rules and regulations in place that you must know before deciding to consolidate your student loans into one easy to manage loan. This is a list of some of the most important rules and regulations pertaining to student loan consolidation. Make sure you understand each of these rules before going through with the consolidation loan.

Student Loan Consolidation is Free

Obtaining a student loan consolidation loan is a free process, so never pay a fee for consolidating. If the lender is charging an upfront fee to consolidate your student loans, it's most likely a scam and you should take your business elsewhere. This scam is often referred to as an "advance fee loan scam", and it's relatively common in the student loan consolidation world.

You Cannot Consolidate While Still in School

You may consolidate your student loans only after your loans enter their grace period, which is six months after graduating or dropping out of school. You can also consolidate once repayment of the loans begin, although you should consider consolidating before that point. It may not be beneficial to everyone, but it's definitely worth taking a look at the numbers to see if it would save you money and make your loans easier to manage.

You Can Only Consolidate Student Loans in Your Name

This rule seems pretty obvious, but in some cases where the student is married or has their parents' name on any of the student loans, it may come into play. Students and parents may consolidate their student loans, but they cannot combine them into one consolidation loan - They must be separate. Same thing holds true for married students who both have student loan debt. As of 2006, married students cannot combine their student loan debt into one consolidation loan - They can, however, each have their own consolidation loan.

Student and Graduates May Consolidate With Any Lender

There are no restrictions that limit which lenders are eligible for consolidating student loans, so you may choose whatever lender you wish. This allows you to shop around for the lender with the best interest rates and incentives. Keep in mind that most lenders require you to have a minimum balance totaling $7,500 or sometimes higher.

Any Federal Student Loan is Eligible for Consolidation

Any type of federal student loan can be consolidated, including single student loans. That being said, you can only consolidate an existing consolidation loan one time, but not in every circumstance. In order to reconsolidate a consolidation loan, you must add a previously not included student loan to the consolidation. In this case, your interest rate would be reconfigured using a formula to weigh the old interest rate with new rate brought on by the student loan being added to the mix. Please note that a student loan consolidation loan uses a weighted average of all of the included student loans to determine the overall interest rate - Reconsolidating in future will not completely reset your interest rate.

Consolidation Loans Offer Longer Repayment Terms

Federal student loans feature standard 10-year repayment plans. When consolidating student loans, you can extend these terms to 12-30 years depending upon how much is owed. As with any loan, though, it's not recommended to extend the terms of the loan, because interest charges will be greater the longer the loan exists. It's recommended to pay off the loan as soon as possible. That being said, extending the consolidation loan repayment plan can help people to better afford the lower payments brought on by a longer repayment plan.

There's No Prepayment Penalties

You may pay off your student loan consolidation at anytime without any risk of prepayment penalties. I highly recommend paying off the consolidation loan as soon as possible to avoid some of the interest charges and to relieve yourself of the financial burden as quickly as possible. Just make sure that when making additional payments each month, you inform the lender that the additional amount should go towards the principle of the loan rather than future payments.

Defaulted Student Loans - Consolidating Student Loans After Default

We err in treating a student loan as a completely different transaction.However, it is very similar to any other loan and this will help us in defaulted a student loan consolidation.

Education has become very expensive and students are opting for loans to repay their debts. However, more than 30% of all students have or are defaulting on their loans. This scenario is equivalent to a financial suicide, because once default takes place, interest runs at a very high rate and the debt assumes impossible proportions very soon.

There are many people with debt in excess of a hundred thousand dollars. There is no way they can repay the debt in time.

Consolidation may work when the amount is not very high. However, in cases where the borrower has allowed the debt to run away to a high amount, ordinary consolidation will not work. A different strategy is required.

The first thing you should do is obtain information about your credit report and your bad credit score. Only then can you proceed to repair it. There are many programs which will help patch up the mess even if you do not have any prior knowledge or experience in undertaking such transactions.

Bankruptcy? Yes or No?

A common misconception is that bankruptcy is the best solution to counter runaway student debt. Nothing could be farther from the truth. Bankruptcy is a big decision which has significant impact. Such decisions should not be taken lightly.

You should adopt a two pronged approach of bringing down your outstanding amount and also removing the late payment report from your file. Your debt can come down by as much as 40% and the reports can be removed in a span of a few days.

Easiest Option

One of the easiest option is to go in for a default student loan consolidation. However, if this is not possible, bankruptcy is not the only way out. There are other options which can be used to stop the situation from worsening. There are time tested strategies which can help you get a grip on the situation.

Irrespective of the course of action that you choose, you will have to improve your money management skills to prevent such a situation from coming up all over again.

Money management is not as bad and as tough as it is made out to be. There are specialized money management programs which will help you manage your finances in a much better manner. Never feel that the situation has gone beyond your control.

Consolidating Your Student Loans Can Really Pay Off

In this day and age, many young men and women are beginning their careers carrying a tremendous debt load. Students have been forced to obtain significant amounts of financing in the form of student loans in recent years. If you are such a person, you may be interested in finding a method through which you can bring your student loans under control. You might want to consider a debt consolidation loan to deal with your student loans and other outstanding debts. There are many benefits to be realized through a debt consolidation loan when it comes to dealing with student loans and other debts.

Through this article, you will be provided with a basic overview about the benefits of a debt consolidation loan when it comes to your student loans and other accounts. This article is designed to provide you with a starting point in your contemplation of whether a debt consolidation loan is the right course for you, whether a debt consolidation loan will solve your problems.

If you have fallen behind on your student loans, you likely are facing higher interest rates and penalties. Of course, you're not alone, many people have ended up in your position. One of the benefits associated with a debt consolidation loan is that you will be able to lower the interest rates, fees, penalties and other related costs associated with your student loans and other debts. You really can end up saving a good deal of money through a debt consolidation loan plan.

By seeking a debt consolidation loan for your student loans, you will only have to deal with one monthly payment as opposed to multiple loan payments that you historically had to manage month after month. You will no longer have the hassle of trying to deal with multiple loans, and multiple loans that are past due.

By obtaining a debt consolidation loan for your student loans and other debts you will be able to work towards restoring your credit history, increase your credit score and better your credit report. If you have delinquent student loans, this has had a negative impact on your credit history and credit score. Through getting a debt consolidation loan you will be able to bring you accounts and loans current. Your credit history and credit score will improve significantly, opening other important doors for you in the future.

There are a number of different lenders that can aid and assist you with a debt consolidation loan as you go about working a plan to deal with your student loans and other debts and accounts. You can obtain help from these resources both in the real world and online. You will want to shop around when it comes to selecting a debt consolidation loan lender that can aid you in dealing with your student loan and other debt issues. Because different debt consolidation loan lenders will offer different deals and interest rates, you will be best served by taking the time to find a debt consolidation loan package that will best meet your current and long term goals.

Consolidating Your Student Loan Debts Makes Sense!

So you've finally finished school and have officially entered what so many adults like to call "the real world", you may feel as though your newly earned money is going directly from your paycheck to your debt repayment plan (with nothing left for your pocket!).So you think about consolidating your loans, but is that really the best option you have? Yes it is actually! Here's why. By consolidating now it's possible to save hundreds, even thousands of dollars in interest that would have been incurred over the years. Especially right now because interest rates are at their lowest and now is a great time to take advantage of that fact. Also by consolidating your loan, you make it more convenient to pay off your debts. Most importantly, you are lowering your overall interest rates which will save you lots of money over longer periods of time. It's essential to get a fixed rate though, or eventually the interest rate could rise. Be weary of companies that try to pull you in by offering very low introductory intere st rates, these jump up in the near future leaving you stuck with a high intrest rate.

Consolidated loans means you only have one lump payment, instead of several smaller ones. Generally the monthly payment is less than all of your loans put together, which frees up a little more money for your wallet. Over time, this could save you money and allow you to have more money readily available to use for stuff like furniture or maybe stereo equipment. Or instead of spending it, having that cash to put into savings will definitely turn out good in the long run. Having one payment makes keeping track of your loan easier which could mean less late payments and a clearer view of where you are at when it comes to your debt load.

When you consolidate, you create the possibility of a lower interest rate. This is because sometimes opportunities arise in which you can defer or through forbearance have a chance to make that interest rate drop even more, thereby putting more of your monthly payment to the actual principle amount of the loan. Which for you means a faster payoff. If you can look for a consolidation that allows for no prepayment penalty, because you can pay off these loans quicker. As you earn more money a plan where you can prepay without punishment is ideal as having this option can bring you closer to being debt free even faster. Another benefit to consolidating student loans is tax breaks. There is a deduction that you can claim whether or not you itemize, this can reduce the amount of taxable income up to $2,500.

And yet another advantage that consolidating your student loan can do is raise your overall credit rating. This is because you will have reduced the amount of creditors actually on your credit report. The more creditors you have on your credit report wanting to collect from you the worse off your actual credit score will appear. One consolidated loan means only one creditor, this will immediately improve your credit rating. Then eventually when all your payments have been made your credit rating will improve further.

Now that all the benefits and advantages to consolidating your student loan debts have been layed out for you, doesn't it make sense to do it? With more free cash, easier and more convenient payments and payment schedules, an improved credit rating, tax breaks, lower interest rates, and even being out of debt sooner, consolidating is definitely worth looking into! So what are you waiting for?

Consolidating Your Student Loan And Unsecured Debt.

Loan consolidation is a simple method by which any consumer can group together all of their unsecured loans and debts in an attempt to acquire a reduced payments through lower rates of interest, longer terms and eliminated late fees. Student loan consolidation services can give an instant relief to anyone who wants to consolidate their loan amount. Today it is possible that anyone could conveniently consolidate all of their college loans and also unsecured debts. Certain consolidation loam programs would also merge all of the student loan amount and debt into one single lower monthly payment that would simply eliminate or even lower interest rates and late fee charges.

There are a number of benefits that are added to student loan consolidation program and debt relief programs. The repayment plan can be set up on the bases where one can easily afford to make the repayment. In doing so one would simply receive just one monthly statement instead of many thus assuring effective debt management and also proper handling of the account. Even if the college loans are default there are possibilities that one may qualify for the student loan consolidation programs. Eligibility for the consolidation loan program is also possible even if one is still in school. One may also benefit from consolidating a number of student loans like private, medical, direct or even federal type into a single account. One can also enroll in such programs even if there is no loan to consolidate or could even become a member of such programs to have no unsecured debts.

Consolidation services would help to save money by lowering the accumulated loan amount and debts by as much as 60 to 70 percent and the consolidation loan counselors would also educate on how to properly manage finance in order to avoid future incidences of debt from occurring. There are many such programs that are free to enroll. Such services and products offer an invaluable financial sound future. By simply enrolling in such programs one could easily save hundreds of dollars monthly by lowering the monthly payments and also by including all undergraduate loans or previously consolidated loans to make one low monthly payment thus reducing the over burden of higher monthly payments. With high cost of graduate school, one could easily make use of consolidation loan programs to manage educational debt and repayment with graduate school loans private loan consolidation programs.

Such services work endlessly to ensure that the paperwork is administered under strict compliance with both federal and state legislation by making the information and procedures more transparent to the consumers. Such consolidation programs are designed to let you informed about consolidation programs to make a sound financial future that is debt free.

Consolidating Student Loans What You Need To Know

Dont miss the Opportunity. Grab it, exploit it! Money matters a lot. Consolidating student loans can relief you from your nightmare. It can simplify your student life and can make you fulfill your ambition. With consolidated student loan your multiple payments can be consolidated to only one payment. You can pay less per month and for a longer period.

How To Get It Done?

You are assumed to have many outstanding loans with variable interest rates. In a consolidation process, defaulted student loans in which all volatile interest rates become a single fixed rate for the entire period of the loan. Student loan consolidation rate is an average interest rate calculated for flexible loan rates. Normally, repayment period can go up to 30 years, depending the amount you owe. Before finalizing any deal, you must know the details. What are the loans you are eligible for consolidation? Here are some tips. You can consolidate the following outstanding loans:

1. Subsidized federal student loans.

2. Unsubsidized federal student loans.

3. All federal direct lending student loans.

4. Federally insured loans for students.

5. Students loan for health education assistance.

6. Private Student loan taken from any authorized financial institution.

7. Federal supplementary loans for students.

8. Federal nursing student loan.

This list is not at all exhaustive. Many other types of student loans can also be consolidated. The financial institutions can verify eligibility criteria for consolidation of loans. Know your eligibility!

1. If you are in a grace period, forbearance or deferment on all loans are being consolidated.

2. If your repayment arrangements are satisfactory with your defaulted loan holder.

3. You have to agree with an income sensitive repayment schedule on consolidation of your loans.

Your Hurdle Is Over!

Dont worry. You may not be eligible for your private college loans consolidation, but your basic problem is solved. While making the deal you just have to certify that you do not have another federal loan consolidation application pending. And of course, your current lender does not have the provision of loan consolidation.