Student Loan Consolidation

Student Loan Consolidation: Replace your Variable-rate Student Loans With One Fixed-rate Loan

If you’re a parent or ex-student who took out any Federal PLUS Loans or Stafford Loans prior to July 1, 2006, those student loans are subject to variable interest rates that will adjust every year. When interest rates rise, your monthly student loan payments may also go up. If you’re on a tight budget, higher monthly payments may prove difficult to manage. Do you wish, instead, you could have a set monthly payment for your federal student loans that you know would never change? Student loan consolidation may be for you.

Federal student loan consolidation gives you the security of a fixed interest rate. By consolidating your federal parent student loans, you’ll replace your variable-rate college loans with a fixed-rate consolidation loan, so you’ll never have to worry about interest rates rising and leaving you guessing about your monthly payment amount.

Take the Hassle Out of Repaying Your Student Loans

If you have multiple college loans in repayment and you’re juggling multiple bills, multiple due dates, and multiple monthly payments to multiple lenders, a student loan consolidation could help make your repayment easier to manage. With a student loan consolidation program, you can bundle all your eligible federal parent or student loans into one single consolidation loan with just one monthly bill and one monthly payment that’s fixed for the life of your college loan.

Cut Monthly Payments on Your Student Loans by up to 40%

Besides offering you convenience and the security of a fixed interest rate, a student loan consolidation could also help you cut your monthly student loan payments almost in half. When you consolidate your college loans, you may be able to extend the repayment term on your parent or student loans by up to 20 years. With that longer repayment term, since you have more time to repay, the amount you have to pay each month will typically go down. By consolidating your college loans, your monthly payments could go down by up to 40%!

Apply in Minutes to Consolidate Your Student Loans

You can apply for your student loan consolidation in minutes, either online or with a quick phone call to NextStudent. It’s fast, easy, and free to apply, and there are NO fees, NO credit checks, and NO co-signers required.

There are also no prepayment penalties on your Federal Consolidation Loan. When you consolidate your student loans with NextStudent, you’ll never be charged extra for paying more than the minimum each month or for paying off your student loan consolidation early.

Who’s Eligible for Student Loan Consolidation?

To be eligible to consolidate your own federal student loans, you can’t currently be enrolled in school more than half time. The student loans you’re looking to consolidate must be in repayment, in a grace period, or in an authorized deferment or forbearance period.

Your parents can consolidate the PLUS loans they took out to help you pay for school as soon as those student loans have been fully disbursed and have entered repayment, even if you’re still in school full time. Although your parents can consolidate their PLUS loans, you won’t be able to consolidate your own college loans with your parents’ loans.

Student Loan Consolidation for Private Student Loans

If you have private student loans in addition to (or instead of) your federal student loans, you won’t be able to consolidate your private student loans under the federal student loan consolidation program. But you may be eligible to consolidate your private student loans separately with a Private Consolidation Loan, which offers the same convenience of a single consolidated loan for your private student loans.

NextStudent believes that getting an education is the best investment you can make, and we’re dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans, Private Student Loans and Student Loan Consolidation at NextStudent.com.

Watch the video related to student loan

Many of you are probably still working to pay off your student loans. A new law called the Income-Based Repayment Plan could help make your payments more affordable. If you stick with it, the government could even pay off your debt. The College Cost Reduction and Accessibility Act created the program back in 2007. Starting July 1, students will be able to apply to see if they’re qualified.

Help answer the question about student loan

How to stop student loan wage garnishments if you agreed to make default payments?
I recently defaulted on my student loan and contacted the student loan company to before they started garnishing my wages. I agreed to a reasonable monthly payment and made the payments on time when I noticed that my wages were being garnished as well. I contacted the student loan company several times and they kept saying that they would remove the garnishment and that my employer had recieved the paperwork. I contacted my employer's payroll and the stated that they never got the paperwork and I should ask for a copy myself to fax it in myself just in case. The student loan company wouldnt give me a copy of the garnishment letter to the employer and claimed to have faxed the paperwork in. It has been 4 straight pay periods and nothing has been done meanwhile im still making monthly payments directly from my bank account. Is there anyway to stop this? PS: I dont need smart remarks about you should have paid in the first place, i know that much but i couldnt afford to at certain points.

About Author

Jeff Mictabor is an enthusiast on the topic of student loan issues in the news. He has been writing for the past 10 years for a variety of education publications. He now offers his writing services on a freelance basis.

Tags: college, debt, education, Federal Direct Loans, Federal Loan Consolidation, Federal Student Loan, Federal Student Loans, loan, Private Student Loans, school, student, Student Debt Consolidation, student loan consolidation, Student Loans, university

Student Loans | Admin June 28, 2009

11 Comments

By Moveontonumber2, June 28, 2009 @ 7:28 am

This furthers the scam, allowing them to make MORE money by prolonging your payoff. My original debt
$30,000. Paid to date $14,000. How much do I owe?
$50,000! Good luck! Right now I’m paying $700.00
per month. Final cost of my loans at time of payoff $90,000. WELCOME TO THE DEBT TRAP!
By Andrew M, June 28, 2009 @ 8:01 am

Nope, sorry, but personal loan won't qualify, as you will have nothing in writing to say that it is student loan interest.
By Alex K., June 28, 2009 @ 8:08 am

Most student loans are limited to citizens or resident aliens of the US. You do not mention whether you are a US citizen living outside the US, or a citizen of another country.

If you are a US citizen, or resident alien (there are a couple of other types of non-citizens that are eligible…refugees for example) then you need to apply each year. The first step is the FAFSA and you can apply on line at http://www.fafsa.ed.gov. After that, there is more to do, but it varies depending on the answers on your FAFSA.

Good luck.
By mnoel228, June 28, 2009 @ 8:36 am

Sounds too good to be true, the only thing a college grad needs to do is live in poverty and report their income until they are 55 or 70 years old.
By FuzzyLizard, June 28, 2009 @ 11:22 pm

Student loans effect your credit score like any other loans (that means credit cards also). As long as you pay on time your credit should be fine. But you do want to pay more than your monthly accrued interests, otherwise you will never pay off your student loan, and the balance will just get higher and higher.
By Dat_1_Chiq, June 29, 2009 @ 2:25 am

When your federal educational loans are in default, you have several options:

You can repay the loan in full.
You can negotiate a new payment plan with your lender.
You can "rehabilitate" your loan.
You can consolidate your loan.

Obviously option one is rarely attractive or possible for defaulted borrowers.

Option two (renegotiate) should be investigated fully – most borrowers skip this step, but it's probably the best option for most people. Call your lender and ask to speak to someone in the "Workout" Department. Explain your situation to them (there's nothing unusual about it) and ask what options are available to you for switching to a graduated, extended or income-sensitive repayment plan. If your lender will agree to change your repayment plan, a few regular payments will get your default status removed, and the new plan may be easier for you to keep up with.

Option three (rehabilitation) is really a specific form of a workout agreement. It probably won't help you much in your situation, because it requires an agreement between you and the lender that will allow you to make 9 consecutive on-time payments of some agreed-upon amount.

Option four is everyone's favorite, but you must absolutely understand what a consolidation loan will do. To keep this utterly simple – a consolidation loan is a brand new loan that will pay off your old, defaulted loan. A consolidation loan MAY lower your monthly payments, but understand how this works. A consolidation loan never lowers your payments by wiping away some of your debt – a consolidation loan lowers your payments by stretching out the length of your loan. If you pay less every month, you'll make many additional monthly payments, and – in the end – you'll pay far more back than you would have paid on the original loan.

As an example: Suppose I lent you $100 and you agreed to pay me back in 2 weeks by paying me $50 a week. You came back a few days later and explained that you weren't going to be able to afford to pay me $50 – is there something else we could do? "Oh, absolutely," I'd say, gallantly. "Instead of paying me $50 a week for 2 weeks, how about if you only pay me $10 a week for 17 weeks?"

See – in the end, you'll pay me back $170 instead of $100 – that's how a consolidation loan works. But remember – we're not talking a $100 loan for a couple of weeks – by the time you pay that $5000 loan of yours back over many years, you'll pay a few thousand more than you might have paid if you didn't consolidate that loan.

I've attached some information about consolidating from the Department of Education – take a few minutes to read it over. If you do choose to go this route, be sure to consolidate with a reputable lender (or directly with the government) and not with some fly-by-night operation that you learn about from some pay-per-click site shilled on Yahoo! Answers.

Good luck to you!
By workingmywayback, June 29, 2009 @ 5:08 am

Well it seems to me if you set up the auto-draft to your bank account willingly you should be able to stop it at will as well. Call your bank and tell them you want to stop sending that company money. Or allow them to take it out of your account, however it was set up.
Good luck!
By AG, June 29, 2009 @ 1:00 pm

No, you can only deduct the interest when you actually pay it, not when it accrues
By Dat_1_Chiq, June 30, 2009 @ 1:42 pm

No one will "take over" your loans. You will still owe the money to your lender when you are in forbearance. They will simply add interest every month while you are making payments.

If you are asking about defaulting the lender will just contract out with a collection agency to start calling and hounding you to mail them payments. If you make 6 to 12 months worth of willing and reasonable payments you can ask your lender to "rehabilitate" your loan. This is when you are issued a new loan and pay off the one in default so you can get federal fin aid again. Again, rehabilitation can only be done after you have made 6 to 12 months of payments.
By videogamer1979, July 1, 2009 @ 6:51 am

doesnt matter….they're both 'installment' loans on your credit report. i wouldnt take a bank loan because MOST LIKELY the interest isnt tax deductible like the student loan.

i would advise to have 2-3 credits…2 installment loans….can be student loan, auto loan or other loan…and a MORTGAGE!
make sure you keep low balances are on revolving accounts…and you should be go to go.
By MLE, July 1, 2009 @ 12:52 pm

Nope. It will no longer be a student loan then. You may be able to consolidate several student loans into another student loan at a better rate, but if you pay it off with a personal loan you'll be left with a non-deductible personal loan.

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