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| Consolidate Graduate Student Loans Online
Now that you are facing the stress of dealing with the repayment of your student loans,
you may want to opt for consolidation. Consolidating student loans can
be tricky, and several factors need to be taken into consideration when
making your decisions. But if you decide that the benefits of
consolidation outweigh the drawbacks, you can find a way to make it
work, whether you have federal or private loans.
There is a difference between consolidating federal and private loans.
The most glaring difference is that, with a Federal Consolidation Loan,
your interest rate is fixed in keeping with a federal formula, while
private consolidation interest rates can be either fixed or variable.
Variable means that the interest rate can increase at any moment. If you
are consolidating both types of loans, you should make sure to keep
them separate.
Consolidating federal student loans
Borrowers are generally allowed up to 10 years to repay, when they
consolidate Federal Stafford and Graduate PLUS Loans. However, some
borrowers can qualify for the government's Extended Repayment Plan.
Borrowers who consolidate student loans through the Federal
Consolidation Loan Program can refinance one or multiple student loans
into one new fixed-rate loan. In other words, the original loan is paid
in full and another one is initiated.
Anyone with eligible Federal Student Loans can get a Federal
Consolidation Loan, and can do so without paying loan fees. Interest
rates are fixed for the life of the student loan. Rates are based on the
weighted average of the interest rates of the loans being consolidated,
rounded up to the nearest one-eighth-percent or 8.25 percent, whichever
is less. Borrowers do not need a credit card, and the fixed interest
rates allow them to avoid future variable rate increases.
You must meet certain eligibility requirements to consolidate student
loans received from the federal government. To qualify, the borrower
must have one or more appropriate Federal Student Loans with a combined
balance greater than $10,000. The borrower also must have left school,
graduated or must be attending school less than half the time.
Borrowers may have only one Federal Consolidation Loan application in
process at a time, and the loans must be in good standing, not in
default. The borrower's loans must also be in a grace period, deferment,
forbearance or repayment status at the time of application. Eligible
Federal Student Loans include:
- All Federal Stafford and Direct Loans
- Graduate PLUS Loans
- Federal Perkins Loans
- Health Professions Student Loans
- Nursing Student Loans
- Federal Supplemental Loans for Students
- Auxiliary Loans to Assist Students
- National Direct Student Loans
- Federally Insured Student Loans
- Federal Consolidation Loans
Graduate
PLUS Loans can be consolidated as soon as they are disbursed to the
school, while Federal Stafford Loans can be consolidated only after
graduation. A borrower with a subsidized or unsubsidized Stafford
Loan must be consolidated with the government's Direct Consolidation
Loans Program.
Consolidating private student loans
Nearly any federal loan can be consolidated, but private loans cannot be
consolidated using federal guidelines. However, private loan
consolidation can be obtained. Private lenders are competing for your
business and may offer borrower incentives, such as cash back, reduced
rates and principal reductions.
To consolidate graduate student loans through a private lender, you will
need to have proof of good credit or apply with a reputable
co-borrower. Private loan consolidation may require a minimum loan
balance, but private lenders tend to be more flexible than federal loan
programs.
You have four main ways to repay your private, consolidated
graduate-student loans. The standard plan involves fixed monthly
payments for up to 10 years. The extended plan allows borrowers to
extend the length of a loan up to 30 years, but each lender's repayment
terms will vary, often depending upon the balances of your loans.
Meanwhile, graduated repayment is tailored for the borrower who will
require lower payments for the first few years and can make higher
payments afterward. If you choose a graduated repayment plan, you should
be aware that time you take off from paying on the principal of the
loan will likely increase the total amount of your loan.
Income sensitive/income contingent repayment plans are quite rare and
are offered only to borrowers whose income will be small. Lenders base
payments upon the monthly income and employment status of the borrower,
the amount borrowed and other factors. Payments are adjusted annually as
the income of the borrower changes.
Things to consider
Before consolidating student loans, figure out how many loans you have
and whether they are federal or private loans. You should also determine
where you are in the repayment process, like whether you are in a grace
period. If the loans are in default, you will be unable to consolidate
them.
You should also consider your total number of lenders, and should take
stock of the other monthly financial responsibilities you face. If using
a private lender, you should be sure to consult one of your lenders for
guidance before consolidation. Private loan consolidation allows for
borrowers to shop around for the best deal, while federal loan
consolidation must adhere to government standards.
Many benefits result from student loan consolidation, including the fact
that consolidating student loans can stretch the repayment term and
reduce monthly payments by as much as 51 percent. The repayment period
could be extended to as long as 30 years, and consolidation can provide
borrowers with low interest rates and give them the ability to make
payments to a single lender.
However, before signing on any dotted line, borrowers should be aware of
the drawbacks of consolidating student loans. As you extend your loan
period length, you are adding to the total cost of the loan, since you
are being charged interest for a longer period of time. If rates
decrease, borrowers who have gone through the consolidation process
cannot benefit from a break in interest rates because they are locked
into a fixed rate. In addition, consolidation can cause borrowers to
lose their benefits on unconsolidated loans.
If you are considering consolidating your graduate student loans, you
are not alone. According to the education funding company NextStudent,
4,653,000 former students consolidated Federal Student Loans through the
Federal Family Education Program during the past three years. Once you know your options and have reviewed your financial outlook, you can decide whether you will become a part of that figure.
Resources
It's important to remember that policies change. Make sure you research
your options carefully. These links will help you get informed:
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Consolidate Graduate Student Loans Online
Consolidate Graduate Student Loans Online
Consolidate Graduate Student Loans Online - Consolidate Graduate Student Loans
Consolidate Graduate Student Loans Online
Why Consolidating Private Student Loans Is The Best Route to Recovery
Many college graduates face a tough time of it as soon as their graduation day is ended. What should be a reason to celebrate instead brings home the weight of debt that has built up over their college careers, with the repayment deferment period officially ending. How can they manage the potentially crushing debt? Consolidating private student loans is often the best option.
The size of college debt can be huge, and many graduates are still repaying the debt a decade after entering the working world. Getting onto a loan consolidation program can be the breakthrough that is needed to finally shake the debt off - and getting onto one even while at college can be a wise early move.
But as with all financial deals, getting the right terms is essential if the full range of benefits are to be enjoyed. The task of clearing student loans is not simple, but with the right consolidation program it can be made easier.
Advantages for Graduates
There are two kinds of graduates that should consider consolidating private student loans. Recent graduates have the maximum debt on their shoulders, with statistics showing that many students leave college with a minimum $30,000 debt. The problem for these graduates is that their careers have not taken off yet, which means their income remains very low.
Getting a well-paying job can take a little time, so agreeing a long-term consolidation deal is the best option. This means that instead of repaying the loan over 10 years, the term is extended to perhaps 25 years. Also, interest rates should be fixed to ensure no fluctuation in monthly repayment sums. Taking on a loan consolidation program that is easy to budget for is important.
A variable interest rate is usually lower, but the problem is that repayment sums can change quickly. Within a few years, the size can increase significantly, which can cause havoc with a strict budget. Consolidating student loans requires reassuring aspects to work properly.
Advantages for Long-Term Graduates
While recent graduates have limited income, a graduate that is already well on their career path can benefit from a different consolidation program. Consolidating private student loans can be done as much as 5 years after graduation, so there is a chance to take better control of the debt when some extra money is at your disposal.
Of course, if the term of the loan consolidation program is going to be very long, a variable rate may be worth the gamble. While variable rates fluctuate, they go both up and down depending on the strength of the markets. Over maybe 25 years, the variable rate may prove cost-effective on balance.
It is worth noting that, with a bigger income, any increase in a monthly repayment sum can be accommodated more comfortably. This is extremely useful when the remaining student loan balances are high, and so the term is longer to keep repayments low.
Where to Find an Effective Program
Finding the right consolidation loan is not very difficult thanks to the development of comparison websites. The fact is that online lenders usually offer the best deals anyway, so sifting through those that meet your own specific needs is easily done automatically. Consolidating private student loans is a wise move, but it can prove expensive if the right lender and terms are not secured.
A loan consolidation program should be able to alleviate the pressure on the graduate, not add to it. It is essential to know the extent of the current debt, and then to ensure that the monthly repayments on the new loan are significantly less than the current monthly obligations.
The existing student loans might have come from different lenders, so finding one willing to buy out each is important too.
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