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Student Loan Consolidation

by Kevin Stith

Student Loan Consolidation serves as a debt repayment tool that saves time and money for students. At present, most of the students in the US borrow money to meet their educational expenses, and students often leave college with large debts. A range of loans, including federal loans and private loans, are now available to students. Usually, students have multiple loans from different government agencies and loan providers. Student loan consolidation is a refinancing plan that helps students reduce their monthly payments. Further, it locks in interest rates, provides flexible repayment options, and improves credit ratings.

Student loan consolidation allows students to consolidate or combine different types of student loans such as direct subsidized and unsubsidized loans, federal subsidized and unsubsidized federal Stafford loans, guaranteed student loans, federal insured student loans, national direct student loans, health education assistance loans, and nursing student loans. In addition, private consolidation loans are offered for private education loans. When a student's loan is consolidated, one has to make only one loan payment. The main advantage of student loan consolidation is that usually there are no penalties and the repayment period can be extended. Depending upon the amount of loan, the repayment term of the loan can be extended from 10 to 30 years. But, certain criteria are to be met in order to consolidate student loans, which vary by lending institutions.

Student loans can be consolidated through any bank that takes part in the Federal Family Education Loan Program. They can also be combined directly from the US Department of Education. There are also numerous student loan consolidation centers and services, which cater to student loan consolidation needs. Online student loan consolidation services are also available.

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