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Consolidate Student Loans - Companies and Programs

By Charles Hopkins Published 10/26/2007 | Loans
One of the essential features in the life of a regular college student is his student loan.  Nowadays, it is quite expected for students and parents to take a student loan to finance his or his childs studies.  With the staggering tuition fees and student expenses, there are numerous people who cannot afford to go to universities without the aid of these student loans.

A recent study showed that majority of college students have taken out student loans to help them pay for school.  Some have to even take two or more student loans in order to get by.  These loans, however, are liabilities which the debtor must pay immediately six months after finishing his course.

Types of Student Loans

There are two kinds of student loans the private loan and federal loan.  Federal loans are those given by the government.  These kinds of loans have much lower interest rates that start to accrue after the student has finished his course.  On the other hand, private loans are those that are obtained from private lending institutions like banks.  Unlike federal student loans, the interest on private loans starts to accrue immediately after the loan is taken.

Consolidating Your Student Loans

Juggling multiple student loans, interest rates and payments is not easy.  Most of the time, the student is left with a meager sum for his living expenses once he shells out an amount for his monthly payments.

If you have taken out multiple student loans, you can consolidate these various loans into one loan with one lower interest rate.  Most of the time, you wouldnt have to pay for consolidation fees.  However, there are two conditions that you have to comply with in order to qualify for loan consolidation:
1.    That you have started paying for your loan.
2.    That six months have lapsed since your graduation or since you finished your course.

Student Loan Consolidation Companies

Consolidation companies offer various consolidation terms.  Some would allow you to pay your loan in a period of 10 years, and some would allow you to extend your payment term for 30 years.  The best companies would provide you with a lot of payment options and terms that you could choose from.

However, you should be careful about choosing your consolidation company because you might just end up paying twice the amount of your original loan.  A longer term may lessen your monthly payment, but your payment, if added, could be twice your principal.

Student Loans Consolidation Programs

There are various programs to choose from, each with their perks and drawbacks.  The first thing that you have to take note of when choosing a repayment program to adopt is the interest rate.  It should not be onerous and usurious.  The next thing that you have to consider is the repayment term.  It should not be unreasonable.  It should allow you to pay your loan, within your means, at the earliest time possible.

If you consolidate student loans, you would be able to save thousands of money.