How You Can Consolidate Federal Student Loans and Lower Your Monthly Payments. Don't You Owe It To Yourself?

When you choose to consolidate federal student loans , you are bundling all of your federal student loans into one easy, manageable loan. Federal student loan consolidation is available for most federal student loans (Stafford, PLUS, SLS), Federal Insured, Perkins, HEAL, NSL, Direct and Guaranteed.

Because of the special features of federal student loans, you cannot include private student loans in your federal student loan consolidation.

* Special Note *

Consolidate your federal student loans first.

This will improve your credit score. How? The interest rate you receive on your private student consolidation loan is based on your credit rating.

When you consolidate federal student loans first, you pay off your federal loans with your federal student consolidation loan. Since you have loans that are paid in full, your credit rating improves. Also, you will have a fewer number of outstanding loans which also improves your credit rating.

Then you save on your private student consolidation loan.

Federal Student Loans can be included in a Private Student Loan Consolidation. BUT, Federal Student Consolidation Loans are subsidized and usually carry a lower interest rate. That doesn't mean you shouldn't look at the possibility of consolidating all of your student loans under a private student consolidation loan, it just means you should not blindly consider it.

The most advantageous route for you to save money is to have both a federal student consolidation loan (for your federal student loans) and a private student consolidation loan (for private student debt).

What are the benefits when you consolidate federal student loans?

You save money
When you consolidate federal student loans you have the opportunity to get a low fixed interest rate. Low interest rates can save you thousands of dollars over the long run, especially for those who need 10, 20 or 30 years to pay off your student loans.

It's more convenient
Choosing to consolidate federal student loans simplifies your finances since you make only one payment each month. You deal with only one lender which means less paperwork and you only have one monthly due date to manage.

Lowers your monthly payments
When you consolidate federal student loans, the single monthly payment is usually far less than the total monthly payments of separate student loans. This greatly benefits you since you recently finished school and don't necessarily have the income to deal with large loan payments.

Besides, now is the time when you need your money the most - for rent, furniture, perhaps buying a car or house, getting married, starting a family...

Improves your credit score
Your new federal student loan consolidation is a single loan that replaces the many outstanding student loans. Since your old student loans are paid in full by the new loan, your credit rating improves for having completed payment on outstanding loans. Also, you will have fewer outstanding loans which helps your credit rating. This will help you obtain beneficial terms on future loans such as a mortgage.

Improves your ability to get a mortgage
In some cases, it may be necessary to consolidate federal student loans in order to get a mortgage.

Why? Mortgage lenders look at how much a person can afford to pay each month. If you have multiple student loans with total monthly payments greater than 8% of your income, your chances of getting the mortgage you want are limited.

By choosing to consolidate federal student loans, you can arrange a lower monthly payment (less than 8% of your income) and take longer to pay off the loan - up to 30 years if needed. The lower monthly expenses help you qualify for the mortgage you want and still able to manage financially.

Am I Eligible?

With most lenders:

You do not need to be employed to consolidate your student loans.
You do not need to have any form of collateral.
You do not need a co-signer.
When you apply to consolidate student loans , most lenders require $10,000 or more of outstanding student debts. Some minimums are as low as $5,000.
Many lenders will not even check your credit score.

Do you qualify for a federal student loan consolidation?

If you have Stafford, PLUS, SLS, Federal Insured, Perkins, HEAL, NSL, Direct and Guaranteed federal student loans you should qualify for federal student loan consolidation.

To find out if you qualify, click on this link and fill out the online application form. There's no obligation to accept - just see how much you can save. Then make your decision.

What other things do you need to consider?

When applying for your federal student consolidation loan, please look for:

The lowest interest rate.
Further discounts to your interest rate.
No fees.
Flexible payment terms and schedule.
No penalties for early repayment.
Consolidate federal student loans first. This will improve your credit score. Then consolidate your private debt.
If your federal student loans (Stafford, PLUS, NSL) all came from a single lender, then you may be obligated to consolidate your student loan from that lender.
Once you consolidate your student loans during your grace period, you lose the remainder of your grace period. You will be required to start your loan payments per your consolidation loan agreement.
Perkins loans can lose some of their favourable forgiveness provisions when they are included in your student loan consolidation.
There are 4 basic student loan consolidation repayment plans you can use to consolidate your federal direct student loans.

You may be eligible for extra savings. When you apply, make sure to look for further discounts to your interest rate. For example, some lenders will further reduce your interest rate by making payments electronically, making on-time payments and consolidating within your grace period.

How do you apply?

A well established, nationally recognized lender can show you the best terms for you - simply apply. We will work with you to develop a suitable plan for your student loan consolidation.

There's no obligation for applying, just apply and find out what terms and benefits you can receive.