Is Consolidating Your Student Loan A Good Idea

Is Consolidating Your Student Loan a​ Good Idea?
Some students leave college and you​ expect them to​ heave a​ sigh of​ relief because at​ long last the​ long hurdle is​ over .​
No more sleepless nights studying for lessons,​ no more academic books to​ read,​ no more exams to​ take and most of​ all no more tuition fees to​ be paid .​
But what if​ the​ student just relied on​ student loans all throughout his or​ her studies? That must have been a​ lot of​ loans to​ pay .​
Fortunately there is​ a​ thing called student loan consolidation.
Student loan consolidation is​ combining all previous loans into one loan to​ make it​ easier for the​ students to​ pay the​ debts .​
If your loans are consolidated,​ you​ need not pay multiple loans every month,​ you​ only have a​ single loan to​ pay and this makes it​ less confusing and burdensome.
Through consolidation,​ a​ student or​ a​ graduate can have some sort of​ relief .​
Most student fret and think of​ their loans while still studying and often miss out on​ their education .​
On the​ other hand,​ fresh graduates that are in​ debt could not focus or​ advance in​ their careers because they have this huge debt to​ pay.
You may be wondering if​ student loan consolidation is​ a​ good idea .​
Here are a​ few reasons why you​ should consider consolidating your loans -
It lowers your monthly payment
Often times if​ a​ student has multiple loans to​ pay,​ it​ means paying higher as​ the​ student is​ paying for interest for multiple loans.
Lower interest rates
Consolidation offers students a​ fixed monthly interest that is​ usually lower than the​ interest rates of​ their previous loans.
New interest rates
Consolidating your loans will most likely mean that you​ are going to​ have a​ new interest rate .​
You may get lower interest rates because interest rates these days are decreasing.
More convenient payment scheme Because all the​ previous loans are combined into one,​ payment is​ easier and more convenient when student loans are consolidated.
Helps you​ save more money
Typically,​ consolidating your loans can help you​ reduce your monthly payments to​ as​ much as​ 54 percent depending on​ the​ interest rates .​
But no matter what the​ interest rate,​ bottom-line is​ your still going to​ save money.
Extends repayment period
Usually consolidation gives the​ students more time to​ pay their debts .​
This is​ a​ good thing so students wont feel pressured to​ pay their consolidated loans because it​ lowers the​ monthly payment.
Different types of​ loans can be consolidated
Student consolidation is​ not only limited to​ one or​ two types of​ loans .​
There are actually a​ lot of​ different types of​ loans that can be consolidated .​
Some loans that can be consolidated are direct subsidized and unsubsidized loans,​ federal insured student loans,​ federal Perkins loans,​ national defense student loans,​ etc.
While student loan consolidation provides a​ lot of​ advantages,​ there is​ also a​ negative side to​ it .​
You may want to​ consider these disadvantages before deciding to​ consolidate your loans.
Increases overall total amount paid Because consolidating all your loans extends repayment period,​ it​ will lower your monthly payments but this will result in​ an​ increased overall total amount paid.
Lose incentives
If you​ consolidate all your loans you​ may lose several incentives that are offered to​ you​ by your lenders.
Lose benefits for Perkins loans Consolidating Perkins loans means cancellation of​ your benefits and losing interest subsidy.
Reading the​ pros and cons of​ student consolidation may have given you​ an​ idea on​ whether or​ not consolidation is​ a​ good idea .​
The advantages obviously surpass the​ disadvantages but it​ is​ still up to​ you​ if​ you​ want to​ consolidate your loans.
Before indulging in​ the​ consolidation scene,​ you​ need to​ do research on​ that consolidation companies offer the​ best deals and will really help you​ lower your payments.
The best way to​ research is​ through the​ internet because you​ will be able to​ compare different plans conveniently .​
You can find information and news on​ consolidation .​
Some sites even offer quotes and this makes it​ easier for you​ to​ compare and choose among different companies.

You Might Also Like:

Powered by Blogger.