College Loan Consolidation – Everything You Need to Know

By | February 22, 2013

For one to be competitive in the “real” world, it is important to get high quality education.  The costs of getting into college have skyrocketed over the past few years.  With the economic crisis the country is facing, it is inevitable that students will incur a number of loans to pay for their tuition and living expenses.  By the time they graduate, they will have to face the harsh reality of paying multiple loans.  The biggest problem now would be how could a fresh graduate manage all the loans he has incurred?  This is where college loan consolidation comes into play.

College loan consolidation is the answer to this problem. It simply means consolidating all the loans into one easy loan.  You do not have to worry about keeping tracks of different payments due each month because there will only be one amount to pay and one interest rate to deal with.  If you have multiple loans, segregate the government from the private ones.  Put priority on the government loans that you have.

You can choose from 10 to 30 years repayment period in paying this loan. Interest rate for a college loan consolidation is lower compared to individual college loans.  In fact, in consolidating loans you are up to some saving advantages.  When you take advantage of the automatic debit plan, you can lower your interest by another quarter point.

The process in consolidating loans is easier and faster because there is no need for a credit check.  You can complete and submit the data needed online and the loan will be processed for you.  Yes, a college loan consolidation will definitely give you a breathing space while you search for that perfect job.  It is hassle free and will take your mind off that pressure of having to pay several loans at a time.

There are several things to consider when applying for a student loan consolidation program:

A.  Many lending institutions would certainly want to do business with you by offering loans with nice sounding benefits.  Naturally, they are also out to make a profit.  You need to find a company with the lowest interest rate offer because in the end, it will save you thousands or even ten thousands in the interest rate payment alone.

B.  If you have a good job and has no problem making regular payments, it would be wise not to consolidate your loans.  College loan consolidation is only for those people who are having sleepless nights worrying about how to make their monthly payments.

C.  Should you land on a well paying job, it is best to consider paying off your loan early.  Doing so can save you a lot of money.  You do not have to be saddled with a loan you incurred some 10 or 20 years ago.  Most lending companies do not charge prepaid penalty fees. On your part, paying off a big chunk of burden will certainly give you a chance to focus more on building your career.

D.  Remember you can only consolidate your student loans once.  Make sure that you make a thorough study especially in regards to the company and their terms and condition.  You need to choose one that can help you and protect your interests.  A company that offers a low consolidation interest rate will certainly help you in the end.

These are just some important factors for one to consider regarding college loan consolidation.

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