There are many reasons to consolidate your student loans. Let’s take a look at the top 10 reasons or advantages.
Advantages of Student Loan Consolidation
- One Single Payment instead of multiple loan payments – Are you drowning with all the different student loan monthly payments you have to be on top of and make each month. Consolidating your student loans will get rid of this chaos and leave you with a single monthly payment that you can easily keep track of.
- Tailor you new loan to suit you – By consolidating your loan you now have the option to choose which lender gives you the best deal in terms of repayment options. Can you go into a more extended repayment plan? Maybe an income contingent repayment option could be worked out. All these options could help you in reducing your monthly loan payments.
- Reduced Interest Rates – Loan consolidations can help you reduce your current loan interest rates substantially enough to make those monthly payments more affordable.
- Deferments and Forbearance – Consolidating your loans will mean you have now the option to once again defer your loan if you meet the specified requirements. This will go a long way in giving you some extra time with no monthly payments to be able to make your monthly payments once they begin.
- Save on Fees – There is no fee to consolidate your federal student loans. Do not worry about additional fees being slapped on you if you go in for loan consolidation.
- No Credit Check – Usually you will find that there will be no credit check done when you consolidate your loans. If you have a less than perfect credit score do not let that turn you away from exploring consolidation.
- No penalty for early payment – There will be no penalty incurred when you pay off your student loans earlier than scheduled. In some cases you might even get a bump in your credit score.
- Simple and easy process – The process to consolidate your student loans is straight forward and pretty simple. It is not time consuming and usually will have only one application to fill out once you decide on the lender.
- Switch lenders – Consolidating your student loans give you the option to switch lenders and in the bargain get a better interest rate, repayment plan, better service and better experience in general.
- Added incentives and perks – Lenders actively seek you out with great incentives and perks to help you make up your mind about consolidation. Reduced rates and better terms are some of the perks you can negotiate before you decide on a lender.
So should you be consolidating your student loans? After all 10 reasons listed above make great sense. Hold on, before you start calling financial institutions learn what are the disadvantages of student loan consolidation.
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