Student Debt Consolidation
Not all student loans are equal...
Student debt consolidation loans are broken down into two basic categories...Federal and Private. Federal student loans are guaranteed against default by the government. They also usually have the benefit of a lower interest rate.
Private student loans usually come with a higher interest rate, since they are not guaranteed against default. Since one advantage of consolidation in lowering your interest rate, if you have a low interest federal loan, consolidation may do more harm than good.
You must be in a qualified federal loan program in order to qualify for some student debt consolidation loans. Another catch is that some private and federal loans cannot be consolidated together. You must meet certain criteria in order to qualify.
To be eligible to consolidate federal student loans you have to meet the following criteria:
* You have to be repaying your loan or be in the grace period before payments begin.
* When you are no longer enrolled in school
* There may be a minimum loan amount required for most consolidation companies.
Examples of Federal student loans that can be included in consolidation are:
Unsubsidized Federal Stafford Loans
Health Professions Student Loans
All Federal Direct Student Loans (Direct Loans)
Health Education Assistance Loans (HEAL)
Subsidized Federal Stafford Loans
Federal Parent Loans for Undergraduate Students (PLUS)
Federal Supplemental Loans for Students (SLS)
Student Consolidation Loans
Federally Insured Student Loans
Loans from the Department of Education
Federal Perkins Loans
Private student loans will still have the minimum loan amount requirement (usually around $10,000) but may have fewer restrictions for consolidation.
Is Loan consolidation for me?
Student loan debt consolidation may not be for everyone. If you are making the payments without any trouble and will be able to pay it off on time, or even early, without struggling then continue that path.
If you are having trouble making the payments or finding it difficult to make ends meet due to the student loans than consolidation may be for you. Most student loan programs have a grace period after graduation before the payments begins.
Use this payment free time to evaluate your budget to see what would be best for your situation. It may be helpful to use a loan consolidation
calculator
to determine if it will be beneficial for you.
I hope this has helped you to decide if student debt consolidation is right for you. Please take the time to read over more of this greatest money saving tips web site to get the most for your money.
Remember help and be helped. Share this site with your friends and family. Everyone deserves to save their hard earned cash!
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