School Loan Consolidation

School Loan consolidation is among the most important and advantageous financial decisions recent graduates and former students can make. Consolidation loans combine several student or parent loans into one bigger loan from a single lender, which is then used to pay off the balances on the other loans. It is very similar to refinancing a mortgage. Some lenders offer private consolidation loans for private education loans as well.

If you're pondering whether or not to consolidate student loans, consider this; all college loans have unique attributes, and not all may be perfectly suited for student loan consolidation. Student loan consolidation is, in most cases, an outstanding option for reducing monthly payments, locking in low rates, and earning opportunities to shave money off your loan balance with lender incentives.

When you consolidate student loans, you lock in the current interest rate by allowing the lender to repay the entire amount, then repaying the lender free from government interest rate fluctuations. Consolidation gives you the opportunity to reduce the size of your monthly payment. Depending on the total amount of student loans that you have you can choose one of several repayment plans with loan repayment periods up to 360 months. The interest rate on your Federal consolidation loan will be the weighted average of the current interest rates on your eligible student loans being consolidated rounded up to the nearest 1/8%, or 8.25%, whichever is less.