School Loan Consolidation, will it really help you?
School loan consolidation offers many benefits-even if you’re currently making your monthly payments without any difficulty. Here are some key of the benefits
Make loan payments to a single lender ::By doing school loan consolidations, you can make monthly bill paying easier, with a SINGLE payment to ONE lender.Reduce monthly loan payments ::School loan consolidation will help to ease the pressure on your monthly budget by reducing your monthly payments by 10% – 60%!Inprove your credit score ::By going in for school loan consolidation, you will help your credit scores and debt-to-equity ratio, both key factors if you’re looking to purchase or refinance a home. Re-use saved money to pay high-rate debt::You can save money and pay off high-rate debt, such as credit cards.
Who are eligible for school loan consolidation?
You need to meet certain criteria for school loan consolidation. Check for these things.
Both school students and parents can cosolidate::Both school students and parent borrowers can consolidate their borrowings. However, students and parents cannot combine their loans through consolidation, since only borrowings from same borrower can be consolidated. But, students and parent can consolidate their borrowings separately.Married students, cannot consolidate loans with spouse ::Married students can no longer consolidate loans with their spouse. When married students consolidated their borrowings together, each spouse became responsible for the full amount of the loan, and the loan could not be separated if the couple got divorced.Timing of consolidation ::School students can consolidate borrowings during the grace period or after the loan enters repayment. Students can no longer consolidate while they are still in school.School students with loans default ::Loans which are in default but with satisfactory repayment arrangements may also be consolidated.
Which Loans Can be Consolidated?
You can consolidate any federal education loan, even a single loan. However, there are, a few restrictions.
Loan consolidation can be done once only ::You can consolidate school loans only once. In order to reconsolidate an existing consolidation, you must add loans that were not previously consolidated. You can also consolidate two consolidation loans together. But you cannot consolidate a single consolidation loan by itself.Ability to switch lenders is limited ::The ability to switch lenders is limited due to the restrictions on consolidating a consolidation loan limit. Generally, you will consolidate your borrowings once, toward the end of the grace period or after the loans enter repayment, and then be locked into that lender for the lifetime of the borrowing. If you want to preserve your ability to consolidate in the future to switch lenders, you should exclude one of your loans from the consolidation.
What to look for in a lender?
All lenders are not created equal, so pay close attention to your options when making a selection for school loans consolidation vendor.
Is lender proven ::Look for a lender with long experience in doing school borrowing consolidations.Variety of options and benefits ::The lender who will consolidate your school borrowings should be able to provide you variety of benefits, apart from low rates. Benefits of school loans consolidation include - interest rate reductions with on time payments, flexible repayment and deferment options.Long term relationship ::Your school loans consolidation lender can finance you in other aspects. You may need to borrow money to go to college after school, establish your business, or need help getting a head start on retirement planning.Loan processing time ::The school loans consolidation vendor must process your loan quickly and without any hassles.Online processing ::School consolidation lenders with online application forms, help and support will save you time and they are available 24 X 7!
