Student Loan Consolidation - Five Ways That Can Save You Money

Consolidating Student Loans Can Boost your Creditconsolidating education loans, can help students and
Scoreyoung professionals live a life free of high interest
Most students take out numerous loans for college,debts.
each with its own interest rate and its own monthlyBy Consolidating Student Loans, You are Locked into
amount. The plethora of different loan sources is aToday's Low Fixed Rates
great benefit in terms of paying for college, butJust because interest rates are low today doesn't
when it comes to credit rating, this long list ofmean they will stay that way. In fact rates over the
outstanding loans can put a serious damper on yourlast several years are lower than they've ever been
overall score.in recent history. It's amazing how much a small
By consolidating student loans, your credit report willpercentage point can save or cost on a college
show one combined loan, usually with a much lowereducation bill over the course of a loan repayment.
overall payment, which equates to a more favorableThe Federal Consolidation Loan allows you to lock
credit rating. By consolidating student loans, you mostinto today's low interest rates when consolidating
likely also benefit from a much lower payment, thusstudent loans. Consolidation loans usually have a
lowering your debt to income ratio.longer repayment period and a lower monthly
Consolidating Student Loans Reduces Debt topayment than is available on the underlying education
Income Ratio and Increases Buying Powerloans.
Having a low debt to income ratio, or the monthlyBy Consolidating Student Loans, you can Receive
amount owed compared to the amount earned,Additional Interest Rate Discounts
makes an incredible impact on the amount of moneyCompanies that specialize in consolidating student
you'll be able to borrow and afford for a first homeloans like offer additional consolidation benefits such
or reliable transportation.as auto payments, and consecutive payments.
The total amount of household debt in the US last- Auto Payments: Receive a reduction in your interest
year was more than 100% of disposable income.rate for making your payments automatically from
Rising education costs have created a vicious cycleyour bank account when you consolidate your
for today's graduating students. As your debt tostudent loans.
income ratio rises, so do the interest rates of each- Consecutive Payments: Some student loan
new loan. Keeping this ratio low by reducing yourconsolidation companies give you the opportunity to
monthly bills can literally save you tens of thousandsreduce your repayment interest rate up to one full
of dollars over a lifetime.percentage point by simply making payments on
Consolidating Student Loans Reduces Dependence ontime.
Credit Cards- No Interest Deferral: Take advantage of the
Having lower bills in the years following college meansflexibility of student loans by deferring loans during
less reliance on high interest credit cards and otherqualified times. While enrolled in graduate school,
loans. The average college student carries aserving in the military, or volunteering with the Peace
whopping 6 credit cards with a total balance overCorps, you can not only defer payments, but stop
$2100.interest from accruing as well.
This means that the $100 credit card purchase for- Grace Period: Consolidating during your grace period
new work attire could cost more than $200 over theallows you to lock in a rate that is often much lower
12 months it takes to pay the full balance.than the standard repayment rate.
Fortunately, smart financial planning, including