Saturday, August 22, 2009

College Loans Consolidation - Should I Consolidate My Student Loans?

If you've education loans, you will face the challenge of having to service multiple student loan rates when making loan repayment. This is common when consolidating student loans at a lower interest rate and taking up new loans at the current student loan consolidation rate.

By consolidating student loans, you practically combine all of your loans together into one single loan package. This implies that you will have only one lender and one loan payment to manage. College loans consolidation also gives you an opportunity to lock in at a lower interest, which can potentially save you a great deal of money over time.

Your personal debt can be easier to manage if you consider repackaging all your loans into one single loan. When talking to a prospective lender about college loans consolidation, you may realize the possibility of converting your loans with variable student loan rates into one with a fixed rate to get the best rate for consolidation, including the option of a longer loan repayment period. Such approach could help you more effectively manage your overall personal loan debt by reducing your monthly repayment.

The consolidation rate chargeable for college loans consolidation will vary depending on if you go through a government or private lender. As a rule of thumb, you will theoretically get the best deal on student loan consolidation rate when working with the federal government to complete consolidation.

However, as and when student loan interest rate heads south, you should check out a private lender to find out any chance of you getting a better deal, should you decide to do your college loans consolidation with a particular lender.

It does not really matter if you should eventually decide to consolidate your loans with a private or government lender. Here is a piece of advice. Be sure to carefully consider what the resulting post-consolidation monthly payment will be like, and find out how much the consolidated loan will cost you in total (principal plus interest) until the entire consolidated loan has been paid in full.

If you do your homework right and your final figures project significant amount of monthly savings, then the answer to our question at the start, "Should I Consolidate My Student Loans?" is certain to be a resounding yes. In this case, any decision to go ahead with college loans consolidation is really a 'no-brainer'.

Tuesday, August 4, 2009

Consolidating College Loans - What You Need to Know

Through consolidation of your college loans, you can reduce the number of payments you make each month into one manageable consolidation loan. Benefits to consolidating college loans include flexibility in structuring payments, and saving money by having a low fixed interest rate.

Student loans are no doubt a terrific way to pay for your education, but of course they need to be paid back. With smart management of your student loans, this can be very easy and affordable.

Although your earning potential will be greater when you graduate from college, you may find that your starting salary isn't as much as you had hoped. This can lead to shortages in your budget when you are paying for living expenses, along with repayment of your student loans. If this sounds like your situation, consolidating your student loans is a good idea.

When consolidating your student loans, you'll find that you have options in setting up your repayment schedule. In most cases, you can choose a term for the new loan of 10 to 30 years. With a longer term, such as 20 years or more, the amount you'll pay each month will be less. However, the total amount over the life of the loan increases with the length of the repayment period.

In many cases, you can even choose to pay less per month in the early stages of loan repayment, and then pay a greater amount once you are making better money down the road.

Consolidation of student loans can be a great way to simplify your finances, and help you keep on top of the monthly payments, especially when you're just starting out as a new college grad.