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Consolidate Your Student Loans

If you think consolidating you student loans is going to be rainbows and gumdrops, you might want to stop and smell the roses. It’s true your student loans can be burdensome, but is consolidation any better? Will you be better off with one lump sum? Student loan consolidation might not be right for you.

Don’t get me wrong. I’m not saying that consolidating your student loans is the wrong choice. What I am saying is that you need to do your research. See if your situation warrants consolidation. Make an informed decision. You will be better prepared. You will have both the positive and negative sides of the equation.

On the bright side of consolidation, you have several advantages. You can count on having a secure interest rate at below 8.25%. This unchanging rate will allow you to plan accordingly in your budget.

Another advantage to consolidation is its flexibility. You can chose to extend your loan. You can extend it up to 30 years. This will allow you to lower your monthly payment. Consolidation doesn’t have any fees. It does not require a credit check. You can even prepay your loan without penalty.

So what is the downside to student loan consolidation?

It really depends on several things. How far are you from paying off your loan? If you are close to paying off your loan, a consolidation does not make any sense. How high is the current rate for consolidation? If you are going to consolidate for 8.25%, you may want to wait for it to drop. You only get one shot at consolidation, so waiting for the rate to drop would be to your advantage.

As you can see, there is a lot to consider with student loan consolidation. Do your research. Watch interest rates. Keep an eye on this market. You only get one shot so don’t waste it.

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