Consolidate Student Loans: Consolidate Student Loans

By pag cannon [ 28/06/2007 ]

Consolidate Student Loans
The Advantages
If student Loan debt is a heavy monthly burden on you or your
family, you are not alone. And if the monthly payment is becoming so
unmanageable that you may have already missed payments or be in danger of
default, then loan consolidation may be right for you.
A consolidation loan is just what it sounds like. With a loan
consolidation program your high interest student loans are combined into
one sometimes lower interest loan, with one lower monthly payment, that
you need to make to only one lender.
Consolidation Loans are much like the same idea of refinancing a
mortgage, or taking a home equity loan to consolidate credit card debt or
pay off other high interest loans. Just about every kind of
Federal Student Loan qualifies for loan consolidation including; FFELP,
FISL, Perkins, Health Professional Student Loans, NSL, HEAL, Guaranteed
Student Loans and Direct loans. In some instances loan consolidation
is even available for private education loans as well. Loan
consolidation is offered for student loans for either graduate or undergraduate
schools.
Interest rates on consolidated student loans are calculated by
taking a weighted average of the loans being consolidated, and are then
rounded up to the nearest 1/8 of a percent. The new interest rate cannot
exceed 8.25. If only these loans are
consolidated the new resulting interest rate would be 6.875 from How to Pay Student Loans