How School Loan Consolidation Will Save You Money

School loans are a necessary evil for most people. They begin paying them six months after graduation and don’t stop until 10, 20, or even 30 years later. By the time they’re finished, they’ve paid double what they originally borrowed. It’s unfortunate but for many people it’s the only way.Luckily, there is a way you can reduce the total amount of money you pay for your student loans. You won’t be able to lower the amount you owe, but by consolidating your loans you can benefit from some cost saving incentives.For instance, when you graduate you usually have many small loans from a few different lenders, each of them at their own interest rate. By consolidating you combine all those loans into one large loan through one lender. When you do this, your interest rate is averaged out, and fixed at a rate lower than some of your previous loans. It might not seem like a big deal, but over the life of your loan, you’ll save thousands.When you consolidate your debt with a single lender they stand to make more from your loan, which means they have the room to offer you discounts and incentives. They do this mostly to set themselves apart from competing lenders, but in the meantime you benefit with reduced interest rates, flexible payment plans, and good standing incentives that will lower your interest even further.Consolidated loans usually allow you to have some flexibility in your payment structure, meaning you can adjust the loan term to be shorter or longer. Adjusting the term will also adjust your monthly payment adversely. For instance, if you make the length of the loan longer, your monthly payments will shrink. This may seem like you’re saving money, however you are paying more interest on a longer term which means in the end it will end up costing you more.On the flip side of that, if you restructure your payments so you’re paying more each month, you’ll pay off your loan sooner and pay less in long-term interest. Nearly all consolidated loans have no prepayment penalties either, so you should make sure your lender won’t penalize you for paying your loans back early.An indirect way that consolidating your loans can save you money has to do with where you apply your funds. If you’ve consolidated and restructured your loans to the point where you have a very low interest rate, along with low monthly payments, you can potentially invest the extra money and earn a percentage point or two or three above your loan’s interest rate. It may only start off as a few extra dollars a month, but again, over time those pennies add up.

Federal or Private Student Loan?

If you are going to graduate school you have many things to consider besides studying for the GRE and choosing the location and area of study that will probably determine the remainder of your life. You additionally have to make sure that you do not fall to far into debt after college. Therefore, you must research student loans. Student loan consolidation is one of the best ways to save money because you are only required to pay your loans back in small increments. You can also look into federal and private student loans, which come with pros and cons.If you have a private loan, a borrower can take out more money but may pay it off at a higher rate. In addition, private lenders are entitled to their own regulations, whereas federal loans are openly operated by set government standards. One example of discrepancy in these programs is the responsibility of private and federal loans during times of economic hardship. If a borrower cannot make a federal student loan payment, he or she can defer for up to three years.There is one big problem that usually happens when someone overlooks the difference between federal and private loans. Federal student loans are guaranteed by the federal government.Consequently, federal student loans carry a fixed interest rate of 6.8%. Though the fixed rate may fluctuate yearly, a borrower has the opportunity to lock it in. When it comes to private loans, there is not a cap on the interest rates and fees lenders can charge-as a result, unsuspecting borrowers find themselves buried in debts larger than anticipated. Often times, students think that mass amounts of money cannot be consolidated along with his federal student loans because the predetermined amount was from private student loans.Because college students are known for procrastinating, on occasion, college students might find themselves accepting student loan offers without doing much research on them. It is a resounding sigh of relief to have the costs of education temporarily funded; but when the tassels are moved and the diplomas are mailed, several graduate students discover that they should have learned more about their student lending. Keep in mind that private loans do serve an effective purpose.It is becoming more common for families to find themselves relying on them to make college educations possible.The largest reason private loan lending grows every year is because some students take out the ceiling of Stafford Federal Student Loans and still fall short of meeting their expenses. Do not let the process of loans be intimidating. As long as you take a minute to do some research, you should find a student loan that will be conducive to your future financial needs.

A School Loan Consolidation Primer

“Hey Dad!”, my son screamed from our front door, “I did it, I was accepted to Boston University.”. My momentary exhilaration was overshadowed by the financial realities of college, especially private college. A quick calculation of my costs for 4 years of tuition, and expenses came to roughly $250,000, a very intimidating figure. Overwhelmed I thought, how could I possibly afford to send him to college? Fortunately, there are various options available to finance this academic endeavor.Federal programs are the single, largest source of school loan consolidation. The first step in applying for this type of aid is going on the Free Application for Federal Student Aid (FAFSA) website, at http://www.fafsa.ed.gov/, and fill out a comprehensive questionnaire. It generally takes around 7 days to process, at which point you will receive a Data Release Number, and Estimated Financial Contribution. It is important to find out if the school you will be attending participates in the federal student aid programs, most do.There are several federal programs available for student aid, assuming school participation. The Federal Stafford Loans, are available to both undergraduate and graduate students. First-year undergraduates are eligible for loans up to $2,625. Amounts increase for subsequent years of study, with higher amounts for graduate students. The interest rate is variable, but never exceeds 8.25 percent. The Federal PLUS Loans are unsubsidized loans made to parents; the interest rate is variable, but never exceeds 9 percent. Federal Work Study provides jobs to undergraduate and graduate students, allowing them to earn money to pay education expenses. These are the major federal sources of loan money for college.Private education loans are also available from a variety of sources to provide supplemental funding when other financial aid does not cover costs. These loans are not sponsored by government agencies, and are offered by banks or other financial institutions. Sallie Mae is a unique loan that consists of a comprehensive package of both private and federal loans.After accumulating 4 years of undergraduate education loans, it is best to consider a School Loan Consolidation Program. Very simply, you can elect to combine all your outstanding loans into one student consolidated loan, which may create more favorable terms and simplify repayment, benefiting both the borrower, and the lending agency. Major benefits include the convenience of lower monthly payments, a single fixed rate, and one payment per month. There is a minor downside, however, students who do not consolidate their Stafford loans will have a 6-month grace period after graduation to begin making payments. Students who consolidate must begin making payments within 60 days of their consolidation. Both parents and students are eligible to consolidate student loans. The school loan consolidation program streamlines repayment by eliminating different terms, repayment schedules, and lenders.Will I be able to afford my son’s college education? Careful financial planning, and research should make this endeavor a reality. While it is true that college tuitions continue to rise, there is more financial aid available to compensate for the increases. Ultimately, a good education is your best investment.

How Consolidation Can Lower Your Student Loan Repayments

Student loan consolidation is a great idea when used correctly and can help a student or a graduate out of a tough financial spot, however, they are not as financially beneficial as they first seem!Most student loans are of the variable type and repayments can go up as well as down, consolidation or refinancing is a good way to lock in a fixed rate especially when interest rates are low as they are at the moment.Student loan consolidation is generally only available to those students who have a good repayment history having always paid their student loans on time. However, should your repayment history be anything else but perfect it is not the end of the road as there are alternatives that can be looked into, standard debt consolidation loans and debt management plans to name a couple, so don’t give up hope.The rates applied to consolidation loans are generally 1-2% lower than those applied to the student loans they are replacing which doesn’t sound a massive saving but it will save you in the region of 50 to 60% on repayments. This may sound like good business, and in the short term it probably is, but in order to lower the repayments to this level an interest rate of 1 or 2% less just wouldn’t cut it so what actually happens is that the term of your loan is extended.This is a problem with consolidation loans that many choose to ignore as they prefer to see the immediate monthly savings rather than the amount that will eventually be repaid. For example, instead of having several, smaller, student loans each of 5 years repayment term, a consolidation of those same loans would decrease monthly payments massively but the the term of the loan could be extended up to as much as 20 years!A good way to utilize a student loan consolidation loan is to consolidate all loans to benefit from the lower interest rate but make the same repayments as were being made prior to consolidation and by doing this any debt will be cleared much sooner.Even if the consolidation was done because previous repayments were unaffordable there will be a time when you wil be able to increase repayments so plan ahead and make a strategy to clear your student debt.Your goal should always be to clear your student debt as soon as possible, in fact this applies to any debt you may have, and do so without sacrificing the cost of having a life too much. It is always beneficial to seek out and utilize methods of debt elimination that can give you the financial freedom you deserve.

The 5 Tips to Consolidate Student Loans Into a Single Loan

Both the private and federal student debts can be consolidated, but not together. When you consolidate student loans, the benefit is the simplicity, i.e. the graduate gets only one or two debts and lenders. But if the debts will also refinanced, then it is possible to get bigger savings.1. When You Consolidate Student Loans, You Can Remove The Co-Signer.Concerning the private student loans consolidation, it is possible to remove the co-signer after 24 or 48 months of making the regular payments. This will free the parent or the relative from the potential liability.2. What Is The Lowest Loan Amount?Most lenders will require a combined sum of $ 5,000 or more for the consolidation for the private debt consolidation and $10,000 for the federal one. You cannot be in a default status with any of your loans. The consolidation process takes about 45 days.3. You Can Reconsolidate, If You Take An Added Loan.You cannot reconsolidate the federal and direct debts unless additional loans are included. For example, if you consolidated your federal debts after your undergraduate degree and then wanted to also consolidate your graduate loans, you can combine the new loans with those that were reconsolidated.4. You Cannot Consolidate Federal And Private Loans Into One Big Loan.There are natural reasons for this rule. If you go back to school, you cannot defer the private loan consolidation payments, but with the federal loan you can. You have to pay the private loan consolidation even if you have difficult economic situation. You cannot get the tax benefits from the paid interests. And you cannot apply for forgiveness on a private loan consolidation.If you will pass away, the private loan goes to the next kin, but the federal loans are forgiven. And finally, the private loans have generally the variable interest rates, so you cannot lock the rate during a low rate period.5. The Need Of The Co-signer.If you are now a recent graduate or undergraduate, it is possible that your lender will require a co-signer for a private loan consolidation. This also depends on the principles of the lender and on the credit history of the borrower. However, in all cases a co-signer will make it sure that the application will go through.The student loan consolidation is a typical financial service process, which is full of details and full of opportunities. That is the reason, why it is wise to turn to the expert and really think this issue thoroughly before jumping into some agreement. I would recommend a low monthly payments, because this system will leave room for the sudden changes in the future. And you can always turn to the lender to pay the loan quicker.

How School Loan Consolidation Can Save You Money

Paying off your school loans is not the most pleasant experience, but it can be made easier if you pursue a school loan consolidation. Doing so will give you the peace of mind that comes from knowing that your debts are manageable. Regardless of which type of school you are preparing to leave, look into consolidating your school loans.What is Consolidation?Consolidating a federal loan is taking all of the student loan payments you owe and combining them into one lump sum. This allows students to have just one monthly payment to one lender instead of several payments scattered all over the place.What is also beneficial about a school loan consolidation plan is that a student can usually get a little lower interest rate by choosing to combine all their loans together. Although the lower percentage may not be an extravagant amount, it can still make a difference when you are living paycheck to paycheck right out of college.Federal loans are also nice to consolidate when you do have problems with an incoming salary because there are several options available to students who need to defer payments. Federal loans, even consolidated loans, allow a grace period of several months after graduation before a student must start making payments.There are also low-income allowances when a student needs to defer payments for a period until they have money coming in the bank. The nice thing about federal loans is that federal laws regulate interest rates, not by the lender, so they will be a little lower than a private loan.Applying and ConsolidatingWhen it comes time to apply for a college student loan, you will have several options available. If you choose to go the private route, then your loan and payments will vary based on your credit history, as well as how high the interest rate is for your lender.You will also lose the opportunity to consolidate your loan, since only federal loans are consolidated. If you go the federal loan route, then you can look into Stafford loans, Perkins loans, or other federal consolidation programs offered by some of the larger national lenders.You should always shop around before making a final decision on a lender so you will be sure to get the best possible loan at the lowest rate. If you choose the federal loan route, then you will be able to consolidate as much as you need because there is no set limit on loan consolidation for student loan payments. You won’t have fees for applying for a federal loan consolidation, and very few penalties exist for these types of loans.All student loans are different, but they all must eventually be paid back. The amount of time that you have is based on the amount of your loan and the rate of interest. You generally have 45 days before you are to begin repayment, so be prepared. Eventually, you might find you want a school loan consolidation.All students who are bound for college have different needs. Because of this, you must investigate all of your options. Your financial aid advisor will help you gain a working knowledge of a school loan consolidation and the benefits associated with it.Working with the right lender and working out the right plan for you will make your post-collegiate experience a pleasant one.

The Advantage and Disadvantage of School Loan Consolidation

Do you have overlapping loan bills that flood your mailbox monthly? Aren’t you getting tired of paying high interest rates in your every loan while stretching your allowance? As a student, you don’t need to suffer beyond your academics and other activities in school. In order to end your financial agony, you should consider about getting school loans consolidation.A school loan consolidation is way to properly manage your loans without getting burdened. There are many people especially college students who are experiencing painful monthly payments of their loans. A loan consolidation loan could be tremendously helpful if you ran up your credit cards while you were in school, or if you have a several high interest loans such as student loans, car loan and others. This will allow you to combine high interest loans into one payment.There are advantages and disadvantages in school loans consolidation. Some of the advantage of loan consolidation is that you would have an easier time in making your payments. All of your credit bills would be listed as one therefore giving you just one time to pay for them. You can also avoid paying for late fees and extra charges. There are private lending companies that charges the borrower extra fees aside from the regular fees that you owe them. If you have consolidated your loan, you would only pay one extra fee under one bill instead of multiple fees.Finally, the bad credit record that will result when you can’t afford to pay the loan bills anymore. If you have plenty of loan bills to pay, you would most likely forget to pay some of them. Because of that, you would leave bad impression on lending companies that would lead on having a bad credit score. School loan consolidation can prevent that from happening.Of course, there are disadvantages with using some consolidation programs. According to some people, debt consolidation is not the answer. To begin with, it can be very difficult finding fair interest rates. Common sense tells us that if the rate on your new loan isn’t any better than the rate charged on your current loans, consolidating your loan wouldn’t make sense. It would still be better for you to pay up all the loans the old way.Another disadvantage on school loan consolidation is that you still owe the lending companies the same amount of money. The only difference is the length of the payment term. If the payment term is longer, this could leave you paying more interest. In addition, availing consolidation usually costs the borrower. You would only end up paying more than you should.Availing the school loan consolidation program would all amount to your wise decision. Before deciding, you should arm yourself information about the advantages and disadvantages of this program. You can only avail the loan consolidation once so you should be very careful in order to prevent facing adversities in the future. Consulting a professional financial adviser would help you balance the situation that you are in.

Federal or Private Student Loan?

If you are going to graduate school you have many things to consider besides studying for the GRE and choosing the location and area of study that will probably determine the remainder of your life. You additionally have to make sure that you do not fall to far into debt after college. Therefore, you must research student loans. Student loan consolidation is one of the best ways to save money because you are only required to pay your loans back in small increments. You can also look into federal and private student loans, which come with pros and cons.If you have a private loan, a borrower can take out more money but may pay it off at a higher rate. In addition, private lenders are entitled to their own regulations, whereas federal loans are openly operated by set government standards. One example of discrepancy in these programs is the responsibility of private and federal loans during times of economic hardship. If a borrower cannot make a federal student loan payment, he or she can defer for up to three years.There is one big problem that usually happens when someone overlooks the difference between federal and private loans. Federal student loans are guaranteed by the federal government.Consequently, federal student loans carry a fixed interest rate of 6.8%. Though the fixed rate may fluctuate yearly, a borrower has the opportunity to lock it in. When it comes to private loans, there is not a cap on the interest rates and fees lenders can charge-as a result, unsuspecting borrowers find themselves buried in debts larger than anticipated. Often times, students think that mass amounts of money cannot be consolidated along with his federal student loans because the predetermined amount was from private student loans.Because college students are known for procrastinating, on occasion, college students might find themselves accepting student loan offers without doing much research on them. It is a resounding sigh of relief to have the costs of education temporarily funded; but when the tassels are moved and the diplomas are mailed, several graduate students discover that they should have learned more about their student lending. Keep in mind that private loans do serve an effective purpose.It is becoming more common for families to find themselves relying on them to make college educations possible.The largest reason private loan lending grows every year is because some students take out the ceiling of Stafford Federal Student Loans and still fall short of meeting their expenses. Do not let the process of loans be intimidating. As long as you take a minute to do some research, you should find a student loan that will be conducive to your future financial needs.

Taming Debts With School Loan Consolidation

Before inflation wreaked havoc in national economies, going to school was the hard part. Now graduating had become the easy part, while paying off the loans have become the most difficult part of life. School loan consolidation and “OPM” options (other people’s money) have become popular means to pay off debt.Reviewing one’s student loan documents may be one of the hardest things to do. Take the case of Virgil Hilliard, a graduate of University of Southern California. The slew of documents, no thicker than the regular bunch of Yellow Pages in a telephone directory told him that he owed $70,000. Medical school was no walk in the park- and the loans he owed were no laughing matter either. Hilliard shares:”The day of my exit interview with a financial aid counselor, it seemed I’d spent every week going through those papers and fretting over just how my life was going to change.”Diplomas and DebtsAccording to the Education Resources Institute (Boston) and the Institute for Higher Education (Washington):”Undergraduates today leave campus with an average $7,594 debt from public four-year campuses, $10,000 if they opt for private schools. That figure is increasing rapidly since tuition rises on average about 7% annually. Graduate students have it worse, particularly those who enrolled in professional programs.”The figures continue their meteoric rise:”On average, law students graduate owing over $40,000–a monthly bill close to $500, assuming a 10-year payback period and an 8% interest rate. Doctors and dentists, meanwhile, finish school owing an average $64,100 and $67,800, respectively, in debt. That makes for monthly payments of $777 and $822.”Solution: School Loan ConsolidationWith the staggering amount of debt of American graduates, it seems that school loan consolidation becomes a clear way out. There’s no way to sugarcoat the situation- any attempts to do so would just be pointless. The only way to tame the beast so to speak is to struggle against it head on. The struggle can be tiresome, but repaying all those debts is never impossible.Computing for Comfortable RepaymentThe general misconception is that the repayment of a hefty debt can be painful on one’s life. Given, you can’t bee too luxurious but it doesn’t mean you have to be a hermit and live on waffles for the next ten years.Take what the USA Group, a loan consolidating company from Indianapolis, has to say about school loan consolidation and repayment:”Most people can foot 8% of their annual salary in student loan payments comfortably. Translated into raw numbers, if you make $24,000 a year, $1,920 annually or $160 a month should be affordable with a minimum of financial pain.”Get a good job too. Because of the volatility of the market, there are many disappointments but bright opportunities still exist. If you have to move to the next city or the next state to get that extra $10,000 in take home bonuses, do it. You’re doing it for your sake (or your family’s sake) and it’s not going to be a permanent arrangement. View it as a way to gain more financial freedom in the future.

A School Loan Consolidation Primer

“Hey Dad!”, my son screamed from our front door, “I did it, I was accepted to Boston University.”. My momentary exhilaration was overshadowed by the financial realities of college, especially private college. A quick calculation of my costs for 4 years of tuition, and expenses came to roughly $250,000, a very intimidating figure. Overwhelmed I thought, how could I possibly afford to send him to college? Fortunately, there are various options available to finance this academic endeavor.Federal programs are the single, largest source of school loan consolidation. The first step in applying for this type of aid is going on the Free Application for Federal Student Aid (FAFSA) website, at http://www.fafsa.ed.gov/, and fill out a comprehensive questionnaire. It generally takes around 7 days to process, at which point you will receive a Data Release Number, and Estimated Financial Contribution. It is important to find out if the school you will be attending participates in the federal student aid programs, most do.There are several federal programs available for student aid, assuming school participation. The Federal Stafford Loans, are available to both undergraduate and graduate students. First-year undergraduates are eligible for loans up to $2,625. Amounts increase for subsequent years of study, with higher amounts for graduate students. The interest rate is variable, but never exceeds 8.25 percent. The Federal PLUS Loans are unsubsidized loans made to parents; the interest rate is variable, but never exceeds 9 percent. Federal Work Study provides jobs to undergraduate and graduate students, allowing them to earn money to pay education expenses. These are the major federal sources of loan money for college.Private education loans are also available from a variety of sources to provide supplemental funding when other financial aid does not cover costs. These loans are not sponsored by government agencies, and are offered by banks or other financial institutions. Sallie Mae is a unique loan that consists of a comprehensive package of both private and federal loans.After accumulating 4 years of undergraduate education loans, it is best to consider a School Loan Consolidation Program. Very simply, you can elect to combine all your outstanding loans into one student consolidated loan, which may create more favorable terms and simplify repayment, benefiting both the borrower, and the lending agency. Major benefits include the convenience of lower monthly payments, a single fixed rate, and one payment per month. There is a minor downside, however, students who do not consolidate their Stafford loans will have a 6-month grace period after graduation to begin making payments. Students who consolidate must begin making payments within 60 days of their consolidation. Both parents and students are eligible to consolidate student loans. The school loan consolidation program streamlines repayment by eliminating different terms, repayment schedules, and lenders.Will I be able to afford my son’s college education? Careful financial planning, and research should make this endeavor a reality. While it is true that college tuitions continue to rise, there is more financial aid available to compensate for the increases. Ultimately, a good education is your best investment.