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Tuesday, January 5, 2010

To consolidate or not to consolidate student loan

Difficulty in finding objective information on student loan consolidation? Let me help you. When I left college, I was somewhere around $ 12,000 in student loan debt. To see how I would have multiple payments to various creditors, and the fear of rising prices over time (yes, you can often depending on the type of loan and the lender), I decided to investigate a possible consolidation of student loans. But Before tell you what decision I made, let me give you some advantages and problems with student loan consolidation:


1. The ability to make a single payment with a single lender to make, so that the headaches are accused of various lending institutions.

2. Most lenders offer a fixed interest rate for the duration of the loan.

3. In general, the company consolidate student loan interest rate will be the most offer your currentStudent loans>.

4. Lenders usually have a longer duration, so a lower monthly payment.

5th student loan interest is tax deductible, then a longer period of repayment interest for tax purposes.

6. Some lenders will also offer a discount interest rate for taxpayers well - more on that in a minute.

7. If you're struggling to find a job, it will be a lot of consolidation lender for deferment of forbearance,in order to gain more time for steady income, and can offer a lower interest rate to it by the lender the interest due during the deferral / grace period.


1. Several maturities. Yes, I know that I mentioned as an advantage, but can also be a problem. Longer maturities, while tending to reduce the monthly payments, and general interest for the duration of the loan by paying more, sometimes much more.

2. Not ready to negotiate. During my term, I called to ask if an agreement was a main trigger is not reached, or if you wish to pay other organizations from student loans, and absolutely no help from banks provided. I suspect that I already had a good deal, with an interest rate of 3.5%

3. Standard - No, no, I repeat, do not default on loans for students. Bankruptcy and other forensic evidence, student loans Welsh> Debt is not working - student loans are like cock roaches, do not die easily. Make sure your student loans to pay back.

Okay, now that we understand some of the advantages and problems, I'll tell you what I did. I decided not to consolidate student loans. I heard there are simply too many advantages involved. The company I went with Nelnet has been, and offers a period of 15 years and reimbursement of 3.5% and 1% interestDiscount rate if I have the first 36 payments on time. That great! Like all things, you need different offers before selecting a student loan consolidation research company.