Guide to Consolidating Student Loans at a Fixed Rate

Does school never end? If you are like many former students, you may be struggling under one or more private student loans. One way to save yourself some money and some hassle is bringing all your private student loans under one fixed interest rate plan

Gaining Control

What if all you private student loans were rolled into one bundle? Then you would have only a single monthly payment, to a single lender, at one a single day of the month, at a single fixed-rate interest, and with a single maturity date, or pay-off date. Cool? Yes? Yes.

Lower Payments

If you are smart, when you approach a lender to consolidate your loan, you will finagle a good fixed low interest rate. And your payment to that one lender will be substantially less than the two or multiple payments you were wrestling with earlier, especially if you extend the maturity date.

Fixed Rates

Many student loans when made initially had interest rates that fluctuate with the expediencies of the lending markets and prime rate considerations. With a fixed interest rate, you do not have to worry about the markets. Once you have a rate locked in, your loan stays at that interest rate through the life of the loan. This means no unexpected surprises for your monthly budget.

Credit Rating

Here is another factor in favor of private student loan consolidation -- it can improve your credit standing. Having a bunch of outstanding debts on your credit report does not look too red hot to prospective lenders. What looks really good is a number of debts responsibly retired. With a private student loan consolidation, a better score can be yours.

Federal Student Loans

One downside is that you will probably not want to pull your federal student loans into the same consolidation package, because federal loans usually carry terrific interest rates that may be hard to duplicate in the private lender sector. If you have one or more federal student loans, you may want to consolidate them first. A private lender who sees that you are managing your finances well by doing that, will probably be more willing to lend you money to cover your private loans.

Credit Cards

If you are like most students, school perhaps caused you to incur rather hefty balances on one or more credit cards. If you can prove that those debts were education related, you can probably have those included in your private student loan consolidation plan as well. Your lender should be willing to work with you on this. This would be quite helpful because credit cards carry pretty high interest rates. Again, getting these off your credit report with a paid-in-full designation will only help your credit record.

Negotiating Your Interest

If you are really wise, you will go online and download a free weighted-interest rate calculator. Take it and enter the interest rates and other details across all you outstanding private student loans. This will give you an average of what you are paying in interest. This gives you a negotiating point. You want to get at least the interest the calculator specifies, but talk your way into one lower if you can.

Worth The Effort

Consolidating your student loans may seem like pretty much a hassle. It is worth it just in terms of piece of mind and bringing a little order to your financial life. Of course, what is wrong with having a little bit better cash flow in any given month? That alone is reason enough to opt for consolidation.

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Tips for Student Loan Repayment

College and other higher education options is an expensive cost. In order to attend a school of higher learning, most students will require a loan. Since added stress can make school hard to concentrate in, the student loan repayment plans can be much easier to deal with than others. Repayment is usually not required until months after you are out of school. Students also tend to get a much better interest rate with a student loan than with other loans. The federal government will also work with the student on a loan settlement if things get too hard to handle. These all combine to make for good loan repayment plans.

The best thing about student loan repayment plans is that they generally don't require repayment until after the student has left school. This includes leaving the school early as well as fully graduating. Since the government is taking a chance on the education of a student, they are figuring that the student is serious about their education and wish to finish their entire schooling. School can be stressful as it is, and most students don't earn a lot of money while attending school. So the repayment plans allow the student to not have to worry about paying back the money borrowed until they have the chance to look for a good job. Nothing is required during the time attending school.

Another good thing about student loan repayment is that the interest rate is generally better than most other forms of loan. The federal government knows that in order to boost the economy, payments for student loans has to be within the reasonable ability of the student to pay it back. By using the lowest interest rate possible, the student will have a greater chance of being able to pay it back with ease. This is a perfect win-win situation since the government still makes enough money to justify loaning the money, while the student is able to save enough money to make the loan an attractive option for completing school.

Student loan repayment allows for a loan settlement option, if things seem to get too difficult to handle. The loan can still be difficult to get control of, even with its superior options. Even people with the best intents, who are in a better position, can find repaying a loan tough. So the government allows for the option to settle the loan. What this means is that after being late for a certain amount of time, the student can offer to pay off the entire loan at a reduced rate. This is normally about 20-30% of the original amount of the loan. This will make the student's credit rating go down a bit, but it will complete the student loan repayment process.

When deciding to continue with higher education, it may be a good idea to look into the options available for student loan repayment plans. Payment usually isn't required to begin until several months after the student completes school. The interest rate for a student loan is usually much lower than most other types of loans. If things get too hard to handle, the government will normally work with the student in order to agree on a loan settlement. These all combine to make the option of securing a student loan repayment plan a very attractive idea.

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Benefits Of Private Student Loans

Many people think private student loans can only be utilized for tuition fees. Well, that's a misconception since you can use these loans for a number of different purposes. The private student loans provide the borrowers with the feasible cash availing opportunity hence helping the students in meeting their various needs which even the scholarships leave aside. Following are a few advantages that you can enjoy with a private student loan.

Well, everyone knows the cost of books can burn a hole in your pocket. With every passing year the prices are soaring higher and higher. Now though you can find some discount on second-hand books but you can't always find the books you need there. So, in such a situation private student loans can help you out perfectly well for providing you with necessary cash to buy them from wherever you can find them.

Other than this, in case you are living in a rented public house, you must be aware of the high rents and may be one could manage the rent somehow but what about the daily expenses of meals and the utilities etc. Meeting these expenses can get really difficult for particularly students so here is when you can make use of the private student loans. You can use them to cover all your expenses or just borrow enough money that could help you in reducing the burden of expenses.

Furthermore, there is another very important yet neglected aspect that can make you suffer for money. Well, you are going abroad or to another city for study purpose where the climate is comparatively harsh than yours', don't you think you will be in dire need of proper clothes and other accessories. However, it is not just that, you may find yourself in need of some extra cash to see a physician in case you get ill. Now, while most students bother their parents to send them more money, you can always sort things out on your own by getting these loans.

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