Reconsolidating a student loan

Along with gaining a new degree, many graduates will also leave campus with new student loan payments they'll have to fit into their post-graduate budgets.Here's what you need to know before deciding to consolidate student loans.

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Interest rates do not appear on a credit report; therefore, the interest rates on your credit cards do not affect your credit worthiness or credit scores.While consolidating those debts into a single payment with a lower interest rate can help you pay off debt faster, you should be wary of companies offering debt consolidation plans.Additionally, if the company managing your payments under your debt consolidation plan fails to make the payments on time, you are responsible, and those late payments may be reflected on your credit reports.Plus, if the company convinces you to close all of your credit card accounts, it may negatively affect your utilization and you have no way to rebuild a rich history by using those cards in the future in a responsible way.One major advantage of federal consolidation loans is that borrowers don't need a stellar credit score to qualify, they can apply any time (even if their loan is in default) at Loan gov, and they'll always get a fixed interest rate.

allows you to consolidate (combine) multiple federal education loans into one loan. Top Private education loans are not eligible for consolidation, but for some Direct Consolidation Loan repayment plans, the total amount of your education loan debt—including any private education loans—determines how long you have to repay your Direct Consolidation Loan.Finding a Personal Consolidation Loan Using a Balance Transfer Consolidating Student Loans Community Q&A Loan consolidation can save you money if done right.You consolidate loans by rolling all your little loans into one bigger one.And I am going to be straight with you: Private college loans are not ideal at any time, especially now, when many lenders have left the student loan business or curtailed their lending in the wake of the financial crisis. With a private loan consolidation, your FICO credit score will determine both whether you get a loan and what the initial rate will be.I contacted student loan guru Mark Kantrowitz at Fin Aid.org, who says just three lenders still offer consolidation: Chase, Student Loan Network, and Wells Fargo. You should also know that there are no fixed rates on consolidated private loans; your interest rate will probably be tied to a benchmark like the prime rate, so when that rises, so will the rate on your loan.When it comes to consolidation, the types of loans you have matters, but most federal loans, including Stafford, Perkins, Direct Plus and Supplemental loans, can be consolidated with other federal student loans."The interest rate on (federal) consolidation loans is an average of the interest rates on the (federal) loans you're consolidating," says Ken O'Connor, director of student advocacy for Fynanz, a New York City firm providing technology for the private student loan market.