Now Is The Time To Pay Your Student Loans

Paying off college loans can seem like a next to impossible task. Each year, more people graduate with increasing levels of debt. This is largely due to the fact that college is expensive. It doesn't matter if you've graduated from a state school, private college, or community college. Most people have some level of debt associated with getting a degree. Now the trick is how you're going to pay for it.

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When you're starring at a mountain of debt, it's very easy to feel helpless. The good news is that depending on the type of debt you have, there are flexible repayment options that can often meet your lifestyle. None-the-less, the responsibility for paying off the debt is yours and must be taken seriously. Otherwise, bad credit, liens, etc. could result impacting your future ability to borrow money.

If you are a recent grad and you're wondering exactly how you are going to pay off your loans, don't despair. There are a variety of methods you can use. One of the most popular and effective is student loan consolidation. Using student loan consolidation, you group your loans into a single loan which often reduces your monthly payment amount.

When I'm asked about the most effective way to pay off student loans, I often answer with this tip that I learned when paying off my graduate school debt. Begin by contacting your lender and see if there is a penalty for early payment. Why early payment do you ask? Some loan providers discourage early payment because they want to collect all of the interest from lenders. Others would rather you pay the debt owed. If they allow early repayment, make one extra payment a year and watch that loan disappear for less cost and ahead of schedule.

The first thing you need to do is pick up the phone and have a conversation with your lender. If they penalize you for early payment then there's no sense in submitting an extra payment each year. Doing so will only lower you disposable income. However, if there is no penalty for early repayment, ask what one extra payment each year - in the amount of your monthly payment - would do to the total amount owed. You will be pleasantly surprise of the positive impact this can have.

By making an extra payment directly towards principle, you are attacking the loan at its source, reducing interest expense over the life of the loan. When you make your payments, be sure to write on the check, "towards principle" only. When I sent my additional check in for the first time, they applied it towards the following month's payment, not exactly what I had in mind.

Get yourself into the habit of making one extra payment each year. This may seem like a difficult task, but think of it this way. Even if your monthly payment is 350 dollars, saving 30 bucks a month to put towards your loan at the end of the year is really no big deal. The result is you will only be making payments for say, 7 years versus 10. Short term pain equals long term gain. Imagine what it would be like to not have that monthly loan.

Some people are truly overwhelmed by the idea of paying back a large amount of debt. The key is to focus on making your monthly payment and at the same time, lowering your overall outstanding amount. Speak with your bank, creditors, and lender to understand how they can help ease the repayment process. Over time you will find you debt has vanished and you saved thousands in repayment.

Online Learning Is Not For Everyone

The world wide web has made the prospect of completing your degree or getting an education in a new field a reality for many. The number of individuals completing their degrees online continues to grow throughout the world. Whether you are paying for it on your own or are receiving support, online education is available.

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Individuals can find online degrees for just about every career imaginable. From more traditional degrees like psychology and English to more hands on types of training like secondary education, online programs are available and utilized by a significant number of students. Online education also provides flexible learning schedules that allow you to learn at your own pace.

Unlike many years ago, online education is no longer seen as something less than a full degree. In fact, many more individuals hold online degrees than once did. This is due to the fact that online degrees have been offered for some time now and can be found in many disciplines. Moreover, domestic as well as international student have benefited from getting their degree online.

People who graduated from online schools used to be small in number. But as time when on, more individuals used online learning to get their degrees. Popular schools like U of P and Strayer have started to graduate thousands of individuals each semester with valuable degrees. The reason is that online learning creates a very flexible learning environment that accommodates every type of schedule.

Online learning has many positive attributes. Virtually anyone can learn online thanks to a variety of programs, scheduling options, and more. No longer does getting your degree require you to stop working and focus on education along. While taking online programs however, you do need to spend considerable time learning your material and doing the necessary learning assignments. No one ever said learning online was easy.

But the fact remains. You can complete your degree or acquire a college degree from the comfort of your own home. A new degree can make you more competitive in the existing workforce or help you transition into a new career. Online schools are very focused on training and job placement, improving your chances of success.

Did you know that online schools also provide financial options to help you pay your way? Similar to traditional colleges and universities, online schools have a number of options for making college affordable. In recent years, more options have been made available including Federal funding programs that provide a grace period and low interest rates. Speak to your admission and financial aid counselors to better understand your funding options.

Complete you online degree and acquire the skills you need to earn that promotion or go into a new line of work. Online education is well regarded and can truly improve your knowledge and skills in virtually any area. If you want to continue working and attend school part-time, online learning is the best option available. Give it significant consideration if you wish to grow and succeed.

Student Loan Consolidation Benefits

For anyone attending an online or traditional institution, paying back college loans is an area of concern. There are a number of options for paying back your college debt and student loan consolidation is one of the best. With a variety of loans, all with different interest rates, loan consolidation is a great way to lower your payments and simplify the process.

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Loan consolidation is the process of reducing your many loans from different lenders and issuing a single loan from a new provider. There are significant benefits in loan consolidation, resulting in lower monthly payments and much less paperwork.

Under loan consolidation, you have a single lender and only one monthly payment to handle. Consolidated loans usually have a few repayments options. You should research these options and decide which works best for your current situation.

Student loan repayment options include standard repayment. This is where you make a fixed sum payment. Most student loan repayment periods are for ten or fewer years. If the monthly amount is too much for your budget, a second option is to extend your payment for a longer time period of time. The last repayment option is to pay a graduated amount during the repayment process, stepping up about every two years.

With graduated repayment, you make payments over an extended time period, much like the extended repayment option, but payments are not fixed. Each year, or every two years, your payment amount increases. This graduated payment schedule is ideal for individuals who need the lowest repayment option available early in the repayment process.

Consider that once a loan is consolidated your interest rate is fixed even though graduated repayment requires a change in this rate every two years. This means that you must make an equal payment each month. This is important when you are repaying a consolidated loan or any loan for that matter. Not repaying your loan in a timely manner can result in default, hurting your credit rating and ability to borrow.

A great way to make your payments is by deciding on the right repayment option to meet your need. One popular method is to set up a direct withdrawal from your account every month. This automatic process simplifies your payment and ensures that you never miss a payment. The sooner you set up the automatic repayment process the easier it will be to make your monthly payments.

When you begin repaying your student loans, consider loan consolidation. Student loan consolidation simplifies the repayment process and gives you flexible repayment options. Consider a budget that allows you to make your payments in a timely manner. More importantly, find a reputable lender who can work with you as you enter the workforce and seek to pay your debt.

Student Loand Consolidation: A Great Way To Pay Before You Start

Just a quick post today to talk about how to pay for school. One of the first places to start is before you even get to college.

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If the focus of your degree is less important than the timing, consider a degree that allows you to earn credit through the College Level Examination Program (CLEP) or Advanced Placement (AP). An Associate of science and bachelor of science degrees are often the most welcoming when it comes to using APs, CLEPs and Subject Specific tests that provide college credit.

Some degrees are more flexible than others. For example, business administration degrees are often the fastest to get and provide the most flexibility. Additionally, a degree in business administration can be as narrow or as broadly focused as you like, and nearly every college offers business degree programs.

Use these tests to get college credit and shorten the time and expense of college. Of course, if you still have loans you can always consolidate them when you enter repayment. But why pay loans if you don't have to. Get college credit before you start. More on the student loan consolidation blog coming soon...

Did you know that the most popular form of financial aid for students attending college, online universities, and community colleges is Student Loans. Many students also have work while in college to pay the bills.

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There are many different types of loan programs but the biggest are those offered by the Federal government. These are often in the form of subsidized Federal Stafford Loans and Unsubsidized Federal Stafford Loans. Private loans are harder and harder to get and as a result, students are focusing more on government funding.

Subsidized Federal Stafford loans are issued through banks even though they are funded by the federal government. The benefit of the subsidized federal stafford loan is that the government pays your loan interest charges while you are still in school. These charges are the interest that have accumulated on your loan as interest is due from the moment the loan is issued.

Why Student Loan Consolidation

Student loan consolidation is a great way to reduce your debt burden after graduating college or grad school. When I completed my degree, I had a number of loans and quite a bit of debt. After learning about loan consolidation, I made a change.

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By consolidating your student loans, either through large consolidators like Nelnet, Sallie Mae, or the U.S. Government, you can expect lower payments (most often) and a simple way to repay your loans.

One of the most difficult issues with loan repayment that I faces was simply remembering when to pay each loan. The benefit of loan consolidation is that I was able to reduce multiple lenders into a single lender requiring only one payment each month. This not only reduced my cost of repayment but simplified the process.

If you're looking to keep things simple and pay off debt, then I recommend student loan consolidation. Anything that saves you money is worth taking a closer look at.

The Navy. An Option For Paying Off Student Loans?

Did you know that the government provides many options for paying off your student loans in addition to student loan consolidation? Here's one option you may have never considered.

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Are you worried about paying off student loans? With the cost of a college education on the rise, many students and recent college graduates are finding themselves overwhelmed by debt. The Navy can help you manage your college debt with special loan repayment programs for qualified students.

For college students and graduates who qualify for the Loan Repayment Program (LRP), the Navy will pay for up to $65,000 of qualified loans acquired from a post-secondary education. To be eligible for this enlisted program the loan cannot be in default and it must be the applicant’s first enlistment. The LRP is available to all active duty Navy enlisted positions!

In addition, the Navy can be a great first job for college graduates. You can get real-world experience in almost any field, and your pay goes further since many of your living expenses are covered. Your college degree may also make you eligible for Officer Candidate School. As an officer, you earn a level of responsibility usually much greater than that found in the civilian world — which is a great way to accelerate your career.

Talk to your recruiter to see if your situation qualifies for the loan repayment program. Your recruiter can also help you explore other opportunities the Navy has to offer.

Paying Down Your Student Loan Consolidation

There are a variety of ways to pay down your student loan Consider these options in addition to consolidation to reduce your monthly out of pocket expenses.

1. Volunteer work: AmeriCorps (domestic arm of the Peace Corps) or the Peace Corps both offer education awards that can be used for tuition or to pay off student loans. Americorps will award $4,725 for a year's worth of successful service. Peace Corps will cancel 15 percent of the debt owed on Perkins loans for the first two-year term and 20 percent for third and fourth years of service. For more information visit the Peace Corps Web site.

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2. Military service: Those serving in the Army National Guard may be eligible to receive up to $10,000 through the Student Loan Repayment Program. Check with a local recruiter to determine your eligibility.

3. Career choice: Teachers who teach in schools that serve low-income students, have a shortage of teachers in a particular subject or teach disabled students in a public or nonprofit school are eligible for up to 100 percent of loan discharge.

Legal and medical professions have programs for student loan debt forgiveness. Visit the Equal Justice Works Web site to get the facts on what you will have to do in the legal world.
The National Health Service Corps offers forgiveness programs to doctors who practice in regions that lack adequate health care. In addition, some hospitals and private health care facilities recruit candidates by dangling loan forgiveness.

4. Death and other: Permanent disability or death will allow for 100 percent forgiveness of your loan, but obviously have serious downsides that limit their popularity. If your school closes before you can complete your program of study or you were issued a false loan certification, the loan is 100 percent forgiven.

In addition to the tips above, make sure that student loan consolidation is part of your payment reduction plan.

What Happens When You Default On Your Student Loan

Don't ignore a defaulted student loan. If you do, your life will take a turn for the worst. Fortunately, there are a few strategies that anyone can use to overcome defaulted student loans. The first thing to know is that getting help is possible. The key to success is knowing that the right kind of debt management can help you overcome your default related problems.

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It's also imperative that you become prompt in repaying your student loan as this will have a positive impact on your credit score. Once you default on your loan your credit score will be negatively impacted, which is something that will harm your finances rather significantly. Only proper debt management will help you out of such a difficult situation. The first strategy in regard to your defaulted student loan is to remember to keep paying your bills on time.

Student loans come with a six month grace period during which time you can get a job and earn enough money to start repaying your loan. A second strategy to help with defaulted loans is to select the right kind of repayment plan, especially one that is flexible which will suit students that have low income and whose repayment amount will be low. The key is to find a repayment plan that you can stick to month after month.

You can also find help by opting to refinance your student loan. Or, even better, think about student loan consolidation which is perhaps the best tip as far as getting help with defaulted student loans.

The best thing that you can do in regard to defaulted private student loan is to speak with your lender and let them know of your inability to repay your loan. This might help get you deferred repayment and sometimes the lender may even agree to a lower your rate of interest. Deferment of your loan is the best advice for recovering from a defaulted loan. So call your student loan provider and explore your options.

What You Do When The Aid Offer Isn't Enough To Pay For College

What do you do if you get that letter and the financial aid offer is not enough? There are several routes to take. First, if family financial circumstances have changed, through loss of a job, for example, it's important to revise your FAFSA and contact the student aid office to advise them of the situation. You may qualify for more aid.

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If the lack of aid is going to make attending impossible students should write a polite letter to the school, appealing for additional help. He suggests writing instead of calling, so it's more difficult for them to turn you down. Ask for help, not money. The rule is that if you don't ask, you won't get.

Another helpful Web site is SimpleTuition.com, which can help you work your way through alternatives to the aid you've been offered in the original letter.

Among those gap-filling alternatives: Private loans to students, PLUS loans to parents, or home-equity loans, if you qualify. You can actually search and compare private student loan providers on their site, including rates and total repayment cost.

Different Types of Student Loans

There are many types of student loans. Some of the most popular are Federal Stafford Student Loans, Federal PLUS (parent loan), and alternative or private loans. These loans make great alternatives to depleting their savings, using current income or borrowing against their home equity when grants and scholarships do not cover all costs. If you've already graduated, combine multiple payments into one with a consolidation loan.

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Alternatively, if you are studying to become, or are currently working as, a primary care health professional, competitive loan repayment and scholarship programs are available through the National Health Service Corps.

The Federal Undergraduate Stafford Loan is a simple interest, government guaranteed, no collateral loan. The interest rate is a fixed rate of 6.8%. Students may borrow while in school and begin repayment six months after leaving school or graduating.

Subsidized vs. Unsubsidized

Depending on your level of financial need, you may be eligible to borrow a "Subsidized" or an "Unsubsidized" Stafford Loan, and in some cases, both. With Subsidized Stafford Loans, the government pays the interest that accrues on the loan while you are enrolled, during your six-month grace period, and during deferment.

The Federal Graduate Stafford Loan is the same as the undergraduate loan, except that graduate students may borrow up to $18,500.00. This number goes even higher for medical loans.

The Federal PLUS is a simple interest, government guaranteed, no collateral loan. The fixed interest rate is 8.5%. Parents may be eligible to borrow up to the total cost of education less all financial aid received. This total cost can include tuition and fees, room and meals, books and supplies, transportation, and more.

Parents are eligible for the PLUS if they meet the minimum government credit requirements. Parents begin repayment 30 days after the final disbursement for the academic year. The PLUS is based on a ten-year repayment plan with no prepayment penalties. The following are examples of monthly payments based on the total amount borrowed.

There are a number of additional loan types available. Regardless of the type you currently have, student loan consolidation can help you reduce your payment amounts and payment structure. Ask your financial adviser about Student Loan Consolidation.

Student Loan Consolidation Options

Does credit card debt and other bills take up too much of your monthly budget? Consolidating your loans can bring your monthly payments back to earth. Just take advantage of the payment-reducing opportunities of Student Loan Consolidation. The benefits are many and the costs are few.

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Loan consolidation allows you to roll the balances on high-interest credit cards or other big bills into one manageable monthly payment. This means that you won’t have to worry about sending multiple checks to multiple companies. Instead, you make a single payment (which is often reduced), freeing up extra cash each month.

How you can consolidation your student loan

1. Research student loan consolidation companies online
2. Let the company know which bills, loans, and credit card debt you’d like to consolidate
3. Pay off your outstanding debts
4. Take on a consolidated student loan that requires only a single payment

Other benefits of consolidating your loans include keeping your monthly payments the same. With loan consolidation, you never need to worry that your monthly costs will rise. Paying off a student loan through consolidation is having a fixed mortgage.

Another great benefit is that you may also save money on your income taxes because the interest on your consolidated student loan may be deductible. However, you'll need to consult a tax adviser to make sure.

Student Loan Consolidation Tips

Here are some great tips on how to consolidate your student loans. One good thing about government loans is that the interest rates are fixed when consolidating them, and so rest assured that the rates that the lending company will charge you are within the boundaries of the law.

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Albeit there is already a ceiling on the interest rates when consolidating government loans, it is always to your advantage if you will shop around for those with really low interest rates.

Grace period of loan repayment means you are done with college and earn a degree but the part of repayment, you just have not started. The grace period is usually from the graduation day to 6 months after and is usually regarded as an excellent time to which you acquire college student loan consolidation.

Take advantage of the grace period and start searching for loan consolidation resources online. There are a number of different loan consolidation providers that can meet the needs of your unique situation.

The result is that you'll save money and reduce your many loans down to one - simplifying the process of payback.

What You May Not Know About Consolidating Student Loans

Having trouble paying your student loans? You might be surprised about this little know fact about consolidation student loans. The concept of deferment and forbearance might be new to you, but it's alive and well.

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These topics come in handy because at times, you may find it financially difficult or impossible to repay your student loan. The worst thing that you can do is bury your head in the sand and ignore your payments (and your lender) completely. The best thing that you can do is contact your lender and apply for a deferment, forbearance, or cancellation of your loan.

Deferment: With a deferment, your lender grants you a temporary reprieve from repaying your student loan based on a specific condition, such as unemployment, temporary disability, or a return to graduate school on a full-time basis. For federal loans, the federal government pays the interest that accrues during the deferment period, so your loan balance won't increase. A deferment usually lasts six months, and you are limited in the total number of deferments you can take over the life of the loan.

Forbearance: With a forbearance, your lender grants you permission to reduce or stop your loan payments for a certain period of time at its discretion (one common reason is economic hardship). However, interest continues to accrue, even on federal loans. Like a deferment, a forbearance usually lasts six months, and the total number allowed over the life of the loan is limited.

Loan Cancellation: With a cancellation, your loan is permanently wiped off your list of financial obligations. It's not easy to qualify for a cancellation, though. Situations when this may be allowed are the death or permanent total disability of the borrower, or if the borrower takes a job teaching needy populations in certain geographic areas. Typically, student loans can't be discharged in bankruptcy.

Remember, these things don't happen on their own. You'll need to find the appropriate application from your lender, attach any supporting documentation, and follow up to make sure that your application has been processed correctly.

Student Loan Consolidation: Easier Than You Think

Being a student these days can be extremely expensive. With costs of tuition, accommodation, and general living expenses to cater for, it is not surprising that many students find themselves turning to loans to help them with their finances.

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However, often these loans can become too much to handle. If you are finding that your student loans are getting a little too much or if you just want a little extra cash at the end of the month, why not consider a consolidation loan?

What is Student Loan Consolidation?

Student loan consolidation is designed to help you to switch all of your student debts into one affordable, manageable monthly repayment. So many students have more than one student loan and managing them every month can be a hassle. By combining the debt into one payment instead of several payments, it makes things a whole lot simpler.

Basically, a consolidation loan is designed to help you to pay off your existing debts. You take out the amount that you owe to all of your student loans and you pay off your original creditors. You then work towards paying back the student loan, usually over a much longer time period. This longer term allows you to pay less every month, though in the long term you will be paying back a lot more than you have actually borrowed.

It is not uncommon for student consolidation loans to last for up to 30 years. Obviously, this is a big commitment and so you need to know that it is the right decision to suit your needs.

Should you opt for a Consolidation Loan?

There are many things that you need to consider before taking out a consolidation loan. The first is whether you can currently afford your monthly repayments. If you can afford them quite comfortably then it would be a bad idea to switch to a consolidation loan. Yes, it would lower your repayments further, but you would be in debt for a much longer time period. So it would make more sense to pay off your existing creditors instead.

If however you are struggling with your debts then a consolidation loan could really help. You don’t have to take the loan out for 30 years, you can choose a shorter time term. Just keep in mind that the shorter the time period of the loan, the higher the monthly repayments will be. However, it will mean that you pay the debt off quicker. So you need to weigh up the pros and cons and then see if a consolidation loan would be right for your circumstances.

Overall, a consolidation loan is just another loan at the end of the day. You have to repay it in the same way as you would repay any other loan. However, it gives you the extra money that you need to enjoy life that little bit more. So if you are struggling with your student loans, why not see if a consolidation loan could help you? Start by researching banks online that offer loan consolidation. Just be sure that you compare like offers to find the best deal.

The Numbers Behind Student Loan Consolidation

Student Loan Consolidation combines several student or parent loans into one bigger loan from a single lender, which is then used to pay off the balances on the other loans. Consolidation loans are available for most federal loans, including FFELP (Stafford, PLUS and SLS), FISL, Perkins, Health Professional Student Loans, NSL, HEAL, Guaranteed Student Loans and Direct loans. Some lenders offer consolidation loans for private loans as well.

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Consolidation loans often reduce the size of the monthly payment by extending the term of the loan beyond the 10-year repayment plan that is standard with federal loans. Depending on the loan amount, the term of the loan can be extended from 12 to 30 years. (10 years for less than $7,500; 12 years for $7,500 to $10,000; 15 years for $10,000 to $20,000; 20 years for $20,000 to $40,000; 25 years for $40,000 to $60,000; and 30 years for $60,000 and above.) The reduction in the monthly payment may make the loan easier to repay for some borrowers.

In a number of circumstances, such as when one or more of the loans was being repaid in less than 10 years because of minimum payment requirements, a consolidation loan may reduce the monthly payment without extending the overall loan term beyond 10 years. In effect, the shorter-term loan is being extended a full decade. The total amount of interest paid will increase unless you continue to make the same monthly payment as before, in which case the total amount of interest paid will decrease.

The interest rate on consolidation loans is the weighted average of the interest rates on the loans being consolidated, rounded up to the nearest one eighth of a percent and capped at 8.25%.

If a student consolidates their loans before they enter repayment, the interest rate used is the lower in-school interest rate. Although the rounding up of the weighted average can potentially cost the student as much as 0.12%, a student who consolidates before entering repayment can save as much as 0.6%, a substantial net savings.

Now you know about student loan consolidation. Check this blog for new posts to help you better understand the student loan consolidation process.

What Is Student Loan Consolidation

Are you attending college or a recent graduate? If so, chance are that you have student loans. Student loans are a great source of financial aid for students who need help paying for their education. Unfortunately, students too often leave college with debt. Additionally, they often have multiple loans from different lenders which is difficult to keep track of. The solution to this problem is loan consolidation.

So, What is Student Loan Consolidation?

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Student loan consolidation means bundling all your student loans into a single loan with one lender and one payment plan. You can think of loan consolidation as similar to refinancing a home mortgage. When you consolidate your student loans, the balances of your existing student loans are paid off, with the total balance rolling over into one new consolidated loan with a single provider. The end result is that you have only one student loan to pay on.

When should I consolidate my loans?

A question that is commonly asked is, "when should I consolidate my loans?" You can consolidate your student loans any time during your six-month grace period or after you have started repaying your loans. If you consolidate during your grace period, you may be able to get a lower interest rate. However, since you will lose the rest of the grace period, it is a good idea to wait until the fifth month of the grace period before consolidating. The consolidation process usually takes 30-45 days.

Considering whether or not loan consolidation is for you?

Loan consolidation offers many benefits. Some of these benefits include:

• A fixed interest rate that is usually lower than what you were previously paying for your loan, saving you thousands of dollars (depending on the interest rate of your original loans)
• Lower monthly payments
• Combining your student loan payments into a single monthly bill

Additionally, consolidated loans have flexible repayment options and no fees, charges, or prepayment penalties. There are also no credit checks or co-signers required to consolidate your student loans.

You should consider consolidating your loans if the consolidation loan would have a lower interest rate than your current loans, particularly if you are having trouble making you monthly payments. However, if you are close to paying off your existing loans, consolidation may not be quite worth it.

Student Loan Consolidation Made Easy

The student loan consolidation process can be complex. But it doesn't have to be. The following step-by-step guide will help you better understand how student loan consolidation works and how it will benefit you for years to come.

Step #1: Apply for Student Loan Consolidation

The first step in consolidating your student loans is to apply for a student consolidation loan using a lender application form.

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When you apply, you'll have the choice of receiving an application and information packet via eSignature or postal mail. Your packet will contain a consolidation application, as well as information about your discounts, and details on how your interest rate is computed.

Step #2: Locate Your Current Student Loans

As a result of recent changes at the Department of Education, you'll need to provide your student loan information with your consolidation application. Today, there are a number of ways that you can locate your student loans and our loan counselors will gladly walk you through each process.

Once you have reviewed the promissory note, and understand the terms, you will sign and return it to us. Either by eSignature online, or by sending the paper application back in our pre-paid envelope.

Step #3: The Student Loan Application Process

Upon receiving your signed application, your loan counselor will check the application for errors. We also check to make sure it complies with all federal guidelines set forth for federal loan consolidation. This ensures that your application is completed quickly and accurately.

After your application is submitted for processing, the loan retrieval" begins. Your student loan consolidator will contact your lenders for the exact amount you owe; this information is sent to them on a loan verification certificate. This process can take up to 60 days depending on the response time from your lender. Once we have valid loan verification certficates from your lenders, your consolidator will send them a check for the balance of your student loans.

Once the check has been sent to your lender and processed, your loans have officially been consolidated. You will receive a new statement from your consolidator detailing when your first payment is due, and when each payment is due thereafter. Your previous lenders can take a week or two to close out your accounts, so do not be alarmed if you get a statement from your consolidator and a statement from your old lender. This happens frequently and is no cause for concern.

Your first billing statement from your consolidator includes the automatic checking account withdrawal enrollment form. It will also include information on any other discounts you are eligible for. Your consolidation will now appear on your credit report. Your previous Stafford loans are paid in full. This is why consolidation is a smart idea for your credit rating - it shows that you have successfully paid off all your existing Stafford loans, which reduces the number of loans you owe, and shows you successfully paid off a series of debts, both of which increase your credit score.

Student Loan Consolidation sounds difficult but is rather easy to implement. Follow the steps outlined above and you'll be making a single payment in no time.

Student Loan Consolidation Basics

Student loans are a great source of financial aid for students who need help paying for their education. Unfortunately, students often leave college with burdensome debt. In addition, they often have multiple loans from different lenders, meaning they are writing more than one loan repayment check each month. The solution to this problem is student loan consolidation.

What is student loan consolidation?

Loan consolidation means bundling all your student loans into a single loan with one lender and one repayment plan. You can think of student loan consolidation like refinancing a home mortgage.

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When you consolidate your student loans, the balances of your existing student loans are paid off, with the total balance rolling over into one consolidated loan. The end result is that you have only one student loan to pay on. Both students and their parents can consolidate loans.

Should I consolidate my student loans?

Loan consolidation offers many benefits:

• Locks in a fixed, usually lower, interest rate for the term of your loan, potentially saving you thousands of dollars (depending on the interest rates of your original loans)
• Lowers your monthly payment
• Combines your student loan payments into one monthly bill

In addition, consolidated loans have flexible repayment options and no fees, charges, or prepayment penalties. There are also no credit checks or co-signers required.

You should consider consolidating your loans if the consolidation loan would have a lower interest rate than your current loans, particularly if you are having trouble making you monthly payments. However, if you are close to paying off your existing loans, consolidation may not be worth it.

How will the interest rate for the student consolidated loan be?

The interest rate for your consolidated loan is calculated by averaging the interest rate of all the loans being consolidated and then rounding up to the next one-eighth of one percent. The maximum interest rate is 8.25 percent.

How much can I save?

How much you save by consolidating loans depends on what interest rate you get and whether you choose to extend your repayment plan. According to Sallie Mae, the leading provider of student loans in the United States, consolidating student loans can reduce monthly payments by up to 54 percent. However, the only way to reduce your payment this much is to extend your repayment plan. You typically have 10 years to repay student loans, but, depending on the amount you're consolidating, you can extend your repayment plan all the way up to 30 years. Remember that if you choose to extend your repayment term, it will take longer to pay off your overall debt and you'll pay more in interest. There are no preypayment penalties, so you can always choose to pay off the loan early.

Am I eligible to consolidate my loans?

In order to consolidate your loans, you must meet the following criteria:

• You are in your six-month grace period following graduation or you have started repaying your loans
• You have eligible loans totaling over $7,500
• You have more than one lender
• You have not already consolidated your student loans, or since consolidation you have gone back to school and acquired new student loans

The following types of loans can be consolidated:

• Direct Subsidized and Unsubsidized Loans
• Federal Subsidized and Unsubsidized Federal Stafford Loans
• Direct PLUS Loans and Federal PLUS Loans
• Direct Consolidation Loans and Federal Consolidation Loans
• Guaranteed Student Loans
• Federal Insured Student Loans
• Federal Supplemental Loans for Students
• Auxiliary Loans to Assist Students
• Federal Perkins Loans
• National Direct Student Loans
• National Defense Student Loans
• Health Education Assistance Loans
• Health Professions Student Loans
• Loans for Disadvantaged Students
• Nursing Student Loans

Where can I get a consolidation loan?

You can consolidate your loans through any bank or credit union that participates in the Federal Family Education Loan Program, or directly from the U.S. Department of Education. The loan terms and conditions are generally the same, regardless of where you consolidate. You may want to check first with the lenders that hold your current loans.

If all your loans are with one lender, you must consolidate with that lender.

If you decide to consolidate your student loans, remember that you can only do so once unless you go back to school and take out more loans. Therefore, you will want to make sure you get the best deal the first time. The interest rate will be the same from all lenders, but some lenders may offer future rate discounts for prompt payment and a discount for having monthly payments directly debited from your account.

Can my spouse and I consolidate our loans together?

You can consolidate your loans together, but it is not a good idea for a couple reasons:

• Both of you will always be responsible to repay the loan, even if you later separate or divorce
• If you need to defer payment on the loan, both of you will have to meet the deferment criteria

When should I consolidate my loans?

You can consolidate your loans any time during your six-month grace period or after you have started repaying your loans. If you consolidate during your grace period, you may be able to get a lower interest rate. However, since you will lose the rest of the grace period, it is a good idea to wait until the fifth month of the grace period before consolidating. The consolidation process usually takes 30-45 days.