| Before you decide to opt for a student loan | | | | the federal loans, in private student loans, you will not |
| consolidation program, let us try to understand the | | | | get any tax relief. |
| types of Student Loans available. | | | | Criteria for Student Debt Consolidation |
| Federal Loans | | | | Not every loan is eligible for federal loan consolidation. |
| This loan is sanctioned by the U.S. education | | | | Here are some of the main criteria for eligibility |
| authorities and is usually approved easily. Here are the | | | | The borrower must be out of school or college |
| different types of Federal loans that are eligible for | | | | The federal loan repayment must have started or be |
| student debt consolidation. However, they can be | | | | in its grace period. |
| widely categorized under | | | | The consolidated loan amount should ideally be above |
| Federal Perkins Loans | | | | $10,000. |
| Stafford Loans | | | | Advantages of Federal Loan Consolidation |
| PLUS Loans | | | | Always remember to keep federal and private loans |
| Features | | | | separate. Consolidate all federal loans into one |
| Federal Loans are tax deductible thereby giving you | | | | program and all the private loans into another. The |
| the advantage of increased cash in hand. | | | | main advantage of student federal loan consolidation |
| These loans offer the facility of deferred payments | | | | is, |
| incase you decide to become a student again. | | | | Multiple loans are being merged into one. |
| Federal Loans "might" be excused in extraordinary | | | | You are free from keeping a track of all the due |
| circumstances. | | | | dates and the corresponding installments. |
| Federal loans come with a guarantee or reliability of | | | | The consolidated monthly payment is considerably |
| the US government. | | | | less than that what you would have paid otherwise. |
| Private Loans | | | | In some cases, you can save up to 45%! |
| Private loans are those that are offered by private | | | | You get to show an improved credit rating as you |
| banking institutions or specialized student loan | | | | have just one loan and one creditor to take care of. |
| consolidation companies for the purpose of education. | | | | On choosing the best student debt consolidation |
| The interest rates are high. It is advised that | | | | program, you are paying less every month. You have |
| students refrain from taking these loans unless | | | | more cash at your disposal |
| necessary. Credit history plays an important role here. | | | | You can stretch the repayment over a period of 30 |
| If the student or his family has a poor credit rating | | | | years! |
| score, the chances of getting a good deal are slim. | | | | Whatever may be your choice, student loan |
| Moreover, the interest rates and the fees are very | | | | consolidation or individual payments, always |
| high. In some cases 10 times higher than that | | | | remember that committing to a loan is a serious |
| charged by the Federal loan providers! Besides, unlike | | | | matter. Only take what you can give back! |