Consolidating Student Loans

Graduating with a college degree is one of the greatest accomplishments anyone can ever experience in their lifetime, but this also means that all of those student loans you borrowed over the course of your college career are now ready to begin the repayment process. It can be startling at first glance when a college grad sees how much they actually owe in federal and private student loans–and for good reason. This number often reaches into the tens of thousands of dollars–as a matter of fact, borrowing student loans and other financial aid to attend college is on average one of the top financial burdens (along with a mortgage) anyone will ever take on during their lifetime.

Needless to say, once student loan repayments begin–which by the way is typically six months after graduation or dropping out of school–it can be a little scary. Often times you’ll have multiple outstanding student loans, varying monthly due dates and ridiculously high payment amounts. This is where consolidating student loans may be beneficial to you. When consolidating student loans, you essentially roll all of your student debt into one easy-to-manage loan that will almost always be a lower monthly payment than if you made each student loan payment individually.

Student loan consolidation is on the rise in the U.S., and this is for the most part because of the recent boom in college attendance. More people than ever are attending colleges around the U.S. and the world for that matter. People are returning to school because they may have lost their jobs, they want to develop new skills to be more competitive at their current job, or they simply are looking for a career change. Graduating high school students are heading to college at incredible numbers, and this is largely due to the fact that today’s job market is so competitive. If you don’t have a college degree in today’s job market, you’re at an immediate disadvantage.

So as college students begin to graduate in large numbers over the next several years, more and more of them will be looking to consolidate student loans to help reduce their payments and make their student debt much more manageable. It’s very important to point out that student loan consolidation is not for everyone. In some cases, consolidating makes no sense financially, and so it’s up to you to get informed before you sign the dotted line for any student loan consolidation program. This is where we can help. Consolidating Student Loans (.com) will teach you what you need to know about the student loan consolidation process so you know what to expect. We will help you to make the right decision about whether or not consolidation is the answer for you.

Benefits of Consolidating Student Loans:

  • Your student debt becomes much more manageable as all–or a portion of–your student loans are rolled into a single consolidation loan. That way you no longer need to pay several student loan payments each month and instead just make a single payment.
  • Consolidation will almost always reduce your monthly payment. The way this works is by extending the consolidation loan’s repayment period longer than a typical student loan. The standard term for repaying a student loan is 10 years. By consolidating student loans, you essentially extend these terms to 15, 20 or more years to help reduce the monthly payments.
  • In some cases (but not all), you can lower your interest rate by consolidating. This is why it’s so important to shop around at different lenders when considering a student loan consolidation as an option. In order to get the best interest rates possible, you must do a little research on your own to find the best rates at the time since they are constantly changing as the financial markets fluctuate.
  • There are no fees to consolidate. If you find that a lender is trying to charge you a fee for a federal student loan consolidation, there is a good possibility that it is a scam of some sort. In this type of scenario, your best bet is to try a different lender.

Potential Disadvantages of Consolidating Student Loans:

  • Consolidation extends your loan terms so you must pay them back for a longer period of time. To bypass this issue, you can simply make larger payments as your income allows. This will help you pay off the consolidation loan before it reaches full term.
  • Once you have consolidated, you can only re-consolidate one time–but there’s a catch. This caveat is a little confusing, but it basically means that once you have consolidated your student loans, you may consolidate again in the future if you have another student loan that was not originally included in the consolidation loan. If you do not have any student loans “on the side” that you can add to your current consolidation loan, then you cannot re-consolidate.