Student Loan Consolidation Info

Student Loan Consolidation Tips

7 Tips on Getting the Best Rates for Student Consolidation Loans

Student consolidation loans may offer the best options for students to repay their college loans. However, consolidating may still be a burden especially if you did not choose the loan with best rate and terms for you. Before you sign up with any lender, always check the offerings of several lenders.

Here Are 7 Tips to Consider Before You Choose a Lender

1. Student loan consolidation rates may vary depending on the borrower’s financial situation and credit. It is helpful that you have a good credit score to receive a lower interest rate. There are free credit reports available to all. Sign up for one and check for any mistakes or problem areas. You can appeal those things that may be in error.

2. Determine the monthly costs from each lender. The monthly costs may depend on the student's financial situation, the payment term available and the lender you choose. Some lenders can offer up to 50% lower monthly plans depending on the interest rates offered, length of loan and discounts for various things like on time payments and automatic payments from your checking account. You need to know all this information before you make a final choice on your lender.

3. The lender should have simple loan payments. The main purpose of the student loan consolidation is to simplify your payments. You should review their terms and make sure that the monthly payments will not cause more burden to you.

4. The lender should have a fixed interest rate. Most federal student loan consolidations charge interest at a fixed rate. You should research for the lowest rates and consider if it will increase or not through the course of the loan. There are options online where you can calculate the interest rates and compare it with your present student loans. This will help you assess which lenders will help you most. This is also a chance for you to narrow down your choices. You may limit your choices to the lenders that can offer you the lowest interest rates.

5. Know if the lender will be able to extend your payment period. With student loan consolidation, you will be able to lower your monthly payment and at the same time may extend your payment period up to 30 years depending on how much you are consolidating. Before choosing a payment term, make sure that this will not burden you especially once the monthly payments have been calculated depending on the payment period. If you choose a longer payment period, check to see that there are no penalties for early payment. That way, as you pay increases through the years, you may be able to increase the amount of your monthly payments to speed up repayment.

6. Ask if there are in-school student loan consolidation programs. These programs will help you lock your low rate while in school. This is because you will automatically be placed on a deferment status while in school. With this option, you will lose the 6-month grace period that is usually offered to borrowers. However, you may request for a forbearance of up to 1 year. Before deciding on this, make sure that you do your research and gather information from other borrowers online.

7. Evaluate which lender provides the lowest interest rates. The student loan consolidation is your best option since it can help you save thousands of dollars over the course of your loans with a lower interest rate. If you fail to do your homework upfront, you may be stuck with a lender's higher rate without knowing that there are lenders that now offer lower rates. Be sure to keep yourself updated with the rates that are charged by different lenders on student loan consolidation.