Consolidating college loan money

09-Oct-2016 02:03 by 4 Comments

Consolidating college loan money - joejonas dating

Consolidation can affect your eligibility for forgiveness.

It won’t be determined by your financial history, as it would be if you refinanced.Consolidating starts that clock over, so if you’ve been in an income-based repayment plan for five years and plan to stay in that plan until you hit forgiveness in another two decades, it’s not generally worth it to consolidate.4.Federal consolidation and private refinancing are very different.In that instance you're essentially finding a private lender that will refinance your private loans.If you have private debt and you're offered a lower rate and better terms through refinancing with a reputable lender, that's worth pursuing.If you consolidate your loans now, your new rate will be based on a weighted average of all your loans' interest rates.

So, for a simplified example, if you have two loans, one for ,000 at 4% interest and one for ,000 at 6%, your consolidated loan will have a ,000 balance and a 4.7% interest rate.

Historically, that may have been accurate, since consolidation was often used as a way to lock in a low interest rate on variable-rate loans, says financial aid expert Mark Kantrowitz.

But that hasn't been the case for the past decade, since the government stopped issuing student loans with variable rates.

Read on to learn how to apply for federal student loan consolidation or student loan refinancing and how to decide whether one is right for you.

[Skip to refinancing] Only federal student loans are eligible for this type of consolidation.

Log in with your Federal Student Aid ID and click on “Complete a Consolidation Loan Application and Promissory Note.” Make sure you’ve decided on a student loan repayment plan and a student loan servicer; you can choose each on the application.