| When consolidating student loans, it's important to | | | | There are no restrictions that limit which lenders are |
| know what you're getting into first. As with any | | | | eligible for consolidating student loans, so you may |
| financial decision, you must do your homework | | | | choose whatever lender you wish. This allows you to |
| before signing on the dotted line. Consolidating | | | | shop around for the lender with the best interest |
| student loans is not a difficult process, but there are | | | | rates and incentives. Keep in mind that most lenders |
| several rules and regulations in place that you must | | | | require you to have a minimum balance totaling |
| know before deciding to consolidate your student | | | | $7,500 or sometimes higher. |
| loans into one easy to manage loan. This is a list of | | | | Any Federal Student Loan is Eligible for Consolidation |
| some of the most important rules and regulations | | | | Any type of federal student loan can be |
| pertaining to student loan consolidation. Make sure | | | | consolidated, including single student loans. That being |
| you understand each of these rules before going | | | | said, you can only consolidate an existing consolidation |
| through with the consolidation loan. | | | | loan one time, but not in every circumstance. In order |
| Student Loan Consolidation is Free | | | | to reconsolidate a consolidation loan, you must add a |
| Obtaining a student loan consolidation loan is a free | | | | previously not included student loan to the |
| process, so never pay a fee for consolidating. If the | | | | consolidation. In this case, your interest rate would be |
| lender is charging an upfront fee to consolidate your | | | | reconfigured using a formula to weigh the old interest |
| student loans, it's most likely a scam and you should | | | | rate with new rate brought on by the student loan |
| take your business elsewhere. This scam is often | | | | being added to the mix. Please note that a student |
| referred to as an "advance fee loan scam", and it's | | | | loan consolidation loan uses a weighted average of all |
| relatively common in the student loan consolidation | | | | of the included student loans to determine the overall |
| world. | | | | interest rate - Reconsolidating in future will not |
| You Cannot Consolidate While Still in School | | | | completely reset your interest rate. |
| You may consolidate your student loans only after | | | | Consolidation Loans Offer Longer Repayment Terms |
| your loans enter their grace period, which is six | | | | Federal student loans feature standard 10-year |
| months after graduating or dropping out of school. | | | | repayment plans. When consolidating student loans, |
| You can also consolidate once repayment of the | | | | you can extend these terms to 12-30 years |
| loans begin, although you should consider consolidating | | | | depending upon how much is owed. As with any loan, |
| before that point. It may not be beneficial to | | | | though, it's not recommended to extend the terms |
| everyone, but it's definitely worth taking a look at | | | | of the loan, because interest charges will be greater |
| the numbers to see if it would save you money and | | | | the longer the loan exists. It's recommended to pay |
| make your loans easier to manage. | | | | off the loan as soon as possible. That being said, |
| You Can Only Consolidate Student Loans in Your | | | | extending the consolidation loan repayment plan can |
| Name | | | | help people to better afford the lower payments |
| This rule seems pretty obvious, but in some cases | | | | brought on by a longer repayment plan. |
| where the student is married or has their parents' | | | | There's No Prepayment Penalties |
| name on any of the student loans, it may come into | | | | You may pay off your student loan consolidation at |
| play. Students and parents may consolidate their | | | | anytime without any risk of prepayment penalties. I |
| student loans, but they cannot combine them into | | | | highly recommend paying off the consolidation loan as |
| one consolidation loan - They must be separate. | | | | soon as possible to avoid some of the interest |
| Same thing holds true for married students who both | | | | charges and to relieve yourself of the financial burden |
| have student loan debt. As of 2006, married students | | | | as quickly as possible. Just make sure that when |
| cannot combine their student loan debt into one | | | | making additional payments each month, you inform |
| consolidation loan - They can, however, each have | | | | the lender that the additional amount should go |
| their own consolidation loan. | | | | towards the principle of the loan rather than future |
| Student and Graduates May Consolidate With Any | | | | payments. |
| Lender | | | | |