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STUDENT LOAN CONSOLIDATION GUIDE
Have you just graduated from college and are worrying
about paying back your student loans? Typically, college
grads have over $25,000 in debt. If you have multiple
loans with different lenders, consolidating can be
helpful. Detailed below are the pros and cons of student
loan consolidation.
Pro
When you consolidate, you lock in lower interest rates.
Being that student loan rates are at an all time low,
now is the perfect time to consolidate. When you
consolidate, the interest rate your receive will be an
average of all the rates from your current loans. If you
don't consolidate, it is likely that your rates will
increase over time.
Con
It is possible that when you consolidate the overall
cost of your loan will increase. When you consolidate,
your debts are unified into a new loan with a longer
term. Typical student loan consolidation terms are
between 10-30 years. As a result, you will benefits by
decreasing the amount you owe on a month-to-month basis,
but you will pay more interest over life of the loan
consolidation term. Therefore, if you can afford your
current payments for your loans, then make the payments
and do not consolidate.
Pro
Managing debt becomes much easier when you
consolidate. Instead of having to worry about multiple
loans to pay, and when you have to pay them. When you
consolidate, you'll have only one payment to make each
month, to one lender.
Con
The requirements for consolidating can be difficult for
potential borrowers. Your loans must be from specific
lenders, the total owed amount must be greater than
$10,000 and you must have graduated or not be currently
enrolled in school. You also can not be in default on
any of your loans.
Pro
When you consolidate your student loans, you'll be
increasing your credit score. How? Because your are
eliminating the total number of open accounts that you
have on your credit report.
Con
A student loan consolidation program may not be your
best solution. There are programs offered by the
Government that allow students looking to pay-off their
loans to do community service and/or teach in certain
areas in exchange for eliminating their debt. Also, if
you have a Perkins loan, there are occasions where your
debt can be forgiven. In addition, if you have other
types of unsecured debt, you should consider
enrolling in a regular
debt consolidation program. We also offer
unsecured loans for consolidating debt. It is always
wise to research all of your choices before you choose
to consolidate. It is a good idea to research all your
options before you consolidate.
In conclusion....
Life beyond college is not easy. Having to worry
about your debts does not help. Considering all of the
pros and cons above will help your determine if a
student loan consolidation program is the best option
for your today. We invite you to
apply for a free, no obligation student loan
consolidation quote online today.
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