Student Loan Consolidation FAQ's
Got Questions About Student Loan Consolidation?
In this session, you will find answers to
frequently asked questions about Student Loan Consolidation.
This information is designed to help you find the right consolidation student loan to help ease your repayment
What is a Student Consolidation Loan?
Student Consolidation Loans are for students who have
After graduation, lenders expect graduates to start repaying their student loans. In simple terms, a student
consolidation loan combines two or more loans into one.
How Does a Student Consolidation Loan Work?
Basically, the consolidating lender pays off
your numerous student loans and a new loan that consolidates all of your individual loans is issued.
You receive a new repayment schedule based on: (a) the size of your education loan debt, (b) the loan interest
rate and, (c) the repayment plan you’ve chosen.
What Will My Interest Rate Be Based On?
Your Student Consolidation Loan interest rate is
based on the weighted average of the loans you are consolidating rounded up to 1/8 of a percent.
One really great piece of news is, your interest rate can never exceed 8.25%.
What Are The Benefits of Obtaining a Student Consolidation Loan?
Since a good percentage of
students graduate with a number of student loans, combining or consolidating these loans into one, makes repaying
student loans easier and cheaper.
By consolidating their student loans, graduates only have to concern themselves with paying one lender instead
of several. In addition, consolidating their student loans can save them money because the interest rate on their
student consolidation loan generally is lower than the interest rates on their current student loans.
What Types of Student Consolidation Loans Are There?
You can get a FFEL or a Direct
When Can I Obtain a Student Consolidation Loan?
You can get a FFEL or a Direct Consolidation
Loan during your grace period, once you’ve entered repayment, or during periods of deferment or forbearance. PLUS
Loans are eligible for consolidation once they are fully disbursed.
You can also get a Direct Consolidation Loan (but not a FFEL Consolidation Loan) while you’re in school. You
must be attending at least half time and have at least one Direct Loan or FFEL in an in-school period.
Why Wouldn’t Every Student Apply For This Type of Student Loan?
As with most things in life,
obtaining a student consolidation loan isn’t simply a cut and dry issue. For some students and parents, this may
line up to be a great idea. For others, not such a great idea. Since it's an individual decision, you'll want to
examine the complete list of pros and con. Give serious thought by carefully researching the long-term
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