Posts Tagged ‘Repayment Term’
October 23rd, 2009
Debt from student loans can be crushing to recent college graduates and get in the way of achieving other life goals. Fortunately, there is a way to reduce the strain on your finances and even improve your credit score. Many graduates are turning to loan consolidating to help manage their loan repayments. The procedure and requirements differ from federal and private loans.
Consolidating Federal Loans
Stafford loans and Federal Perkins loans are examples of federal loans. These loans are given to you by the government and may or may have accrued interest while you were attending school. Consolidating your federal student loans provides a fixed-rate refinancing program that takes all of your existing federal loans and combines them into one new loan. Your monthly student loan repayment could be cut by as much as 50% as well as reduce your interest rate by .6% if you consolidate during your grace period. One monthly payment will help you simplify your finances.
Payment relief
By creating one consolidated loan you can receive payment relief, a lengthening of your repayment term from the standard 10 years to up to 30 years. This frees up your disposable income to spend on other expenses like car payments, housing, and work-related necessities. There are no penalties for overpayment, so when the funds become available you can make larger payments and minimize your repayment term.
Consolidating Private loans
Like federal loans, consolidating private loans means lumping everything into one new loan. To consolidate your private loans from undergraduate school you will have to apply with a qualified co-signer in order to be approved. If you have a graduate degree you do not have to apply with a co-signer.
Some of the benefits include reduced interest rates, rate reductions, deferment, and no prepayment penalties. Loan holders may lower your interest rates if your credit has improved. Applying with a co-signer who has good credit could help you get a lower APR loan. There is a grace period for medical/dental residents as well as military personnel if their private student loans are consolidated. As with federal student loan consolidation, you can also have your repayment period extended allowing you to pay the lowest monthly payment possible.
By: Joseph Devine
August 23rd, 2009
One of the frequent problems that students across the country face is financing their education. Such is the price of quality education that more than half the students inevitably apply for a student loan. Getting a loan is no big deal; there are many banks and other financial institutions that offer this facility. However, the real problem that students face is while repaying loans. This is because often take more than one student loans without giving much thought to the means of repaying these loans. There is a simple solution for all such students; why don’t you consolidate student loans? Yes, now you have the opportunity to consolidate student loans, which means that you combine all your outstanding loans into a single and more manageable loan. This way you do not have to worry about multiple monthly repayments and different interest rates. If you consolidate loans, you get a lot of benefits. Some of these benefits are:
• Lesser monthly repayments: By converting all your loans into a single loan, you now make a single repayment each month, which is significantly lesser than the monthly repayments of all the loans combined together. This can be achieved by increasing the loan repayment term. Therefore, if you consolidate student loans, you get to save a lot of your precious money in the bargain.
• One loan repayment option instead of multiple ones: With a lot more to worry about in life, keeping a track of several loans that have varying payment dates and deadlines can prove to quite irritating and cumbersome. To avoid all this stress and burden, you can simply consolidate student loans and avail the advantage of a single monthly repayment option.
• Lower and fixed interest rate: As opposed to the interest rates of many other loans, student loan consolidation rates cannot be greater than 8.25 percent. So, if you have taken loans at a greater interest rate than this, you now have the golden opportunity consolidate student loans and pay it off at a lower and fixed interest rate.
• Processing fees or credit card checks not required: Credit card check is not required when you apply for student loan consolidation. Lending companies usually have flexible repayment plans along with varying terms that would suit all students. In addition, when you consolidate student loans, you do not need to pay any processing fees.
• Electronic repayments of student loan: When you consolidate student loans, you have the option of paying it off electronically each month. Most lending companies offer a 0.25% discount off your student loan rates, if you make monthly payment electronically. Also, if you go ahead with direct debit from your bank, you do not have to worry about remembering the loan repayment date each month.
Loan repayment is the most intrinsic phase of a student loan; therefore, you need to make sure that you handle this phase smartly in order to maintain a clean credit history. A smart way to pay off all your loans is to consolidate student loans. This really takes the pressure off your shoulders!
By: James Manroo
August 12th, 2009
After successfully completing a college degree, many graduates are left with mounting student loan debt which they will need to begin repaying six months after accomplishing their education goal. This triumph can feel like defeat if after the six month grace period, he or she does not have a job that pays enough to meet the minimum monthly repayment amount.
This begs the question, should I consolidate my private student loans? To get some relief from the debt, this might be a viable option to consider. Consolidation can significantly lower your monthly payments by combining separate loans into one manageable loan. Stress is also reduced because you will feel more in control of your finances and not regret continuing your education.
Why Should I Consolidate My Private Student Loans?
If reducing the amount of stress you experience every month is not reason enough to consolidate your student loans, there are other reasons to consider which might be convincing.
Having lower monthly payments will extend the repayment term, giving you additional time to payoff the loans. Several different loans mean that you may have several different interest rates which add up to one big rate. Maintaining a good credit history equals lower interest rates.
If learning that lower payments, extended repayment term, and a lower interest rate isn’t enough and you are still wondering whether you should consolidate private student loans, maybe this will convince you.
Loan consolidation is not limited to certain types. If you are seriously considering consolidating, all private student loans are eligible. With a graduate degree, you can consolidate your undergraduate and graduate degree loans without the help of a cosigner. However, having a willing cosigner might help you receive an even lower interest rate.
What Information is Necessary To Consolidate?
Once you have decided that consolidating your private student loans is the right financial decision, you must be prepared to provide specific information on the application such as your name, address, social security number, contact information for personal references, detailed information on your monthly income and expenses. This information is also needed on the cosigner for your loan.
For each loan that is to be consolidated, you will need the account number; name, address and telephone number for each loan servicer; and, the loan balance and payoff amount.
Hopefully, this information has helped you consider the question, should I consolidate my private student loans.
By: Louis Z.