What Are Your Student Loan Debt Consolidation Options?
Student Loan Debt Consolidation
When we speak of student loan debt consolidation, please keep in mind that we are discussing loan consolidation for college student loans. If you are looking to combine payments for other forms of consumer loan debt, you will have to choose another financial vehicle such as a home equity loan or a private loan through your bank.
Student loan debt consolidation enables you to combine all of your college student loans into one student loan. Essentially, your current college student loans are paid off and a new college student loan is put into place with the combined balance. Consolidating your college student loans has many advantages:
• A fixed interest rate
• An extended and income sensitive repayment plans
• A lower monthly payments based on extended repayment and low fixed interest
• Only one check to write
• Only one lender to work with
Of course, I am sure you would like to hear about the disadvantages as well, in my opinion, there are not any.
The following is a list of the eligible college student loans. If you have a private or alternative college student loans or some student credit card debt, you will not be able to consolidate those debts with your college student loans.
College Student Loans that will eligible for inclusion in the Federal Consolidation Program are:
• Subsidized Federal Stafford Student Loans
• Unsubsidized Federal Stafford Student Loans
• All Federal Direct Student Loans (Direct Student Loans)
• Federal Parent Loans for Undergraduate Students (PLUS)
• Federal Perkins Student Loans
• Health Professions Student Loans
• Health Education Assistance Student Loans (HEAL)
• Nursing Student Loans
• Federal Supplemental Loans for Students (SLS)
• Auxiliary Student Loans to Assist Students (ALAS)
• National Direct Student Loans (NDSL)
• Federally Insured Student Loans (FISL)
• Federal Consolidation Student Loans
Most Federal college student loans have variable interest rates. Those interest rates will be adjusted each year. A Federal Student Loan Debt Consolidation will have a fixed interest rate. The interest rate you will pay is determined at the time of consolidation application and is based on a weighted average of the interest rates you are paying on your current college student loans. As mentioned above, current rates are extremely low meaning that you will be able to “lock in” a low fixed interest rate with a student loan debt consolidation.
Finally, if you are currently delinquent or in default on your Federal college student loan, a student loan debt consolidation can cure your delinquency or default status, but only if your financial lender offers an income sensitive repayment plan and only if you meet certain pre-requisites.
I have given you quite a bit of information regarding a Federal Student Loan Debt Consolidation. Follow the guidelines and do the research. Different lending institutions will offer different options. Chose the option that best suites your financial situation. All else will just follow from there.
Start your research on the internet. There is so much information out there, look at all the options not just one.
