Does anyone know if it is better to consolidate your student loans or just pay them off one by one?

Jan 28

Mark SingleyStudent Loans Q&A , 8 Comments

I have 18,000 in student loans and only have 6 months until I start making payments on them. Most of them started out at 2.50% interest and are now at 6.0%. 6,000 of the debt is at 8.95 interest. I want to get them all with one company and at a fixed rate but I dont want it to add on fees. What should I do?

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8 Comments (+add yours?)

  1. dawncs
    Jan 28, 2010 @ 23:56:33

    Yes, it is a great idea to consolidate your student loans right now. It will fix the interest rate and provide you with different payment options to pay it off. Instead of making several payments for several loans, you could be possibly be paying a smaller loan payment for one loan, and this would mean freeing up more money for other life essentials. Besides, think of it as peace of mind from worrying about interest rates going up again.

  2. CK1
    Jan 28, 2010 @ 23:56:33

    Consolidate if you can get a great rate.

  3. MerryChristmas
    Jan 28, 2010 @ 23:56:33

    consolidate – absolutely – at the best rate you can. Even if you have to pay a fee to do it (and you will), it’s worth it because what you save over time in intrest more than pays for your fee.

  4. Shawn N
    Jan 28, 2010 @ 23:56:33

    I would definitely check into consolidating. You have some time before you have to make payments and consolidation only takes a short time. It made it easier on me to consolidate because it was one check and the interest rate was dropped down. Just whatever you do, do not default! It WILL follow you for the rest of your life.

  5. sam i am
    Jan 28, 2010 @ 23:56:33

    better pay them now avoid problems later that is unless these loans are tax deductable then you pay as you go.

  6. John R
    Jan 28, 2010 @ 23:56:33

    Cosolidate your Loans at a Fixed Interest Rate NOW. Don’t let anyone talk you into an Adjusted Rate Loan. Go to the Financial Aid Department at your College and ask them for Help—They do this ALL the time and can Help you. I used Sallie -Mae and got a Fixed Rate of 4.25%. If you need to change to Intersest only, deferment status, or Forebearance— ALL of these options will still be Available to you AND you will Have A Fixed Rate that can never go up, But can be RE-consolidated at a Lower rate later on if interest rates drop. Thanks, John R.

  7. KeraniBai
    Jan 28, 2010 @ 23:56:33

    By all means consolidate.

    William D. Ford Student Loan Consolidation is by far the best one out there!

  8. payingcollege
    Jan 28, 2010 @ 23:56:33

    Yes, typically it’s to your advantage to consolidate. Sallie Mae has a good FAQ that tells you the advantages and disadvantages of consolidation, how the interest rate is set, how the grace period works, etc. There’s also a calculator that lets you plug in your loan amount and see what your payments will be.
    http://www.salliemae.com/after_graduation/manage_your_loans/consolidate_student_loans/fedcon_faq.htm
    http://www.salliemae.com/after_graduation/manage_your_loans/consolidate_student_loans/student_loan_consolidation.htm

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