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StudentFinAidInfo - Student Loans Consolidation
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Financial Aid FAQ
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Welcome to StudentFinAidInfoStudentFinAidInfo - Financial Aid FAQ, Student Loan Consolidation,consolidate College Loans Question: Can I consolidate my fed and private student loans seperately?
Yes you can, in fact- if you choose to consolidate- you HAVE to consolidate private and federal loans separate from each other!
Yes you can, in fact- if you choose to consolidate- you HAVE to consolidate private and federal loans separate from each other!It's not possible to consolidate federal loans and private loans together.
It's not possible to consolidate federal loans and private loans together.
I wanted to jump in to offer one warning, though - you're not going to find a lender who is consolidating private student loans right now. In fact, with the notable exception of the Department of Education's Direct Consolidation Loan Program, you're going to have a near impossible time finding anyone who will consolidate your government loans, either.
Here's some other advice - don't be too quick to leap into a consolidation. It's highly likely that a consolidation loan will not be your best financial option.
A couple of things to think about:
Your federal loans feature a nearly automatic economic hardship deferment feature. If you can't find a job right away, you'll definitely qualify. If you are working full-time, but have a gross income of less than $1353.75 a month ($16,245 a year), you will qualify if you are a one-person household.
The hardship deferment lasts 12 months, and it can be renewed 2 additional times (one year each) for a total period of 3 years. During your deferment, interest will continue to accrue, but you will not be responsible for making your loan payments.
If, for some reason, you don't qualify for the economic hardship deferment, you can take advantage of alternate payment options offered by your lender. There are several of these, including the brand new "Income Based Repayment" plan, which will tie your monthly payment obligation directly to your income. For most borrowers, IBR will result in a loan payment of less than 10% of monthly income. If you keep making payments on the IBR plan, and you still owe money after 25 years (yikes!), the balance of your loan will be discharged at that time.
IBR is just one of several possible options.
So what's wrong with consolidation? For some people, it's the right answer, but most of those people are borrowers who are in a last gasp effort to avoid default. The problem with consolidation is the very nature of what it means to consolidate - it means that you'll pay back your loan V-E-R-Y S-L-O-W-L-Y. I know you said that you haven't had a lot of financial guidance, but I'm sure you've learned that the longer it takes to repay a loan, the more interest you'll pay along the way. It can be VERY expensive to pay 20 or 25 years of interest on a loan, rather than 10, especially when your monthly payments aren't lopping much off your debt.
If you're not financially savvy, don't consolidate before you sit down with someone who really does know their financial stuff. They can explain the advantages and disadvantages of the various options, and most importantly, show you exactly what each option is going to cost.
The best news of all, though, is that you might have 1 to 3 years of additional time to get yourself established in the work world before the loan comes calling. Spend some time reading up on your Economic Hardship Deferment opportunity (https://www.dl.ed.gov/borrower/DefermentFormList.do?cmd=doViewRequirements&wizardName=Economic%20Hardship%20Deferment ) and contact your private loan lender(s) to find out what options they might have available.The private student loan is basically the same thing as any government student loans..
The private student loan is basically the same thing as any government student loans and the private institutions offer almost the same rate interest as the credit card companies. In other words, you should ask for a private student loan only if you ran out of any other options.
http://www.worldbestloans.com/student-loans.htm
Many people choose to ask private players for help because they offer attractive and flexible plans such as: the Stafford loans or the PLUS loans. The private loan is famous for its various types of interests.You can consolidate them separately, however they will be with different lenders...
You can consolidate them separately, however they will be with different lenders (meaning you will be making 2 separate payments). Department of Education is the only lender offering federal loan consolidation and the interest rate you will get will be a weighted average of all your federal student loans rounded up to the nearest 1/8th of a percent. Lenders DO offer private student loan consolidations, and its not that hard to find. Wells Fargo has a private consolidation student loan, and you can consolidate your federal and private loans together, however, it is definitely not recommended. When you consolidate them together, you lose any federal student loan benefits as the federal loan turns into a private student loan. The interest rate on a private consolidation loan is based on your credit and whether or not you need a cosigner is based on your credit and your income and debt-to-income ratio.
Consolidation is a great options for people who just can't afford their full monthly payments but still want to pay on the loan. Putting the loan in deferment/forbearance just postpones the inevitable and the loan just accumulates even more interest while you are not paying on it. Consolidation extends the life of your loan and will give you a fixed interest rate which in turn lowers your monthly payment. If paying the loan for 25 years seems crazy to you, you can always pay more than the minimum payment and there are no pre-payment penalties. With federal consolidation, you still have the option of deferment/forbearance and the IBR program.
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