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Let's Make the Deal
Consolidation can factor into your different repayment options. In order to consolidate your federal student loans, you must be in your six-month grace period or already repaying your loans. You have the right to consolidate a wide variety of college debts including:
Stafford loans (subsidized or unsubsidized)
Health Professions Student Loans (HPSL)
Health Education Assistance Loans (HEAL)
Nursing Student Loans (NSL)
National Direct Student Loans (NDSL)
SLS Loans (formerly ALAS Loans)
Loan consolidation should never be done on the fly, without some serious comparison shopping to make sure that you're getting the best terms and benefits from a lender. Ask what rebates, discounts, interest-rate reductions, and other perks a lender might offer you as a borrower prior to signing up with any institution. Before you consolidate with any lender, it's vitally important to make sure that consolidation is your best course of action. Consolidating loans can lower your monthly payments, but, as previously mentioned, it can also cause you to lose some benefits, such as deferment or forbearance privileges with Perkins loans.
Also remember that when you consolidate loans, the new interest rate you get won't necessarily be the lowest rate you currently have. Rather, any new consolidated loan you get will be a fixed, weighted average based on all the loans you consolidated. The interest rate will be rounded up to the next Vs percent from that weighted average, and capped at 8.25 percent by federal regulations. While you can't consolidate private loans through the federal loan consolidation, you can consolidate federal loans that are in any repayment plan—whether they're currently paid via the standard, extended, graduated or income contingent method. And when you consolidate any of these loans, your repayment plan will be anywhere from 10 to 30 years, depending on the amount of your debt.
If you're having difficulty with your payments, and you're in the process of consolidating loans, you can ask for your lender to temporarily stop your payments while your consolidation loan is being processed, giving you a little wiggle room financially.
At, EdFed, we proudly introduce 'articles on student loans' and 'Learnal - the journal to learn from', our free newsletter on student loan management, which is sure to keep you informed of the latest events and happenings in the student loan market. To receive your copy of the above just use the RSS feed below and add this to your "My Yahoo", blogs, newstickers, and other similar channels accepting distributable content.
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How EdFed Helped others!
The bottom line is EdFed saved me thousands of dollars on my federal student loans. I had already consolidated most of my federal loans through another company, and I thought I was done. I didn't realize I needed to do another consolidation until my Loan Specialist at EdFed explained my interest rates and their borrower benefits. I knew I
couldn't go wrong by choosing EdFed. Their payment incentives will save me over $30,000 on my federal student loans. Thank you EdFed.
- Mark W. San Antonio, TX
Student Loan Consolidation Info - How to Choose the Right Loan Company
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Education is one of the most basic right of any human, but with the increase in prices and the costs involved in education this has made these rights turn into a privilege which very few can enjoy. Any normal person today in the whole of United States has to take an education loan at one point of time to pay for their education fees.
You have worked hard to get to where you are and deserve to have some fun without being saddled by debt. Federal loan consolidation may provide you with a way to hold onto more of your hard-earned money.