5 Advantages of Student Loan Consolidation
It is noted that people get tired of paying interest on their monthly student loan installments. Students may be afraid of cash-flow problems that prevent them from repaying the loan on time. The answer to these problems is student debt consolidation loans.
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Student Loan Consolidation
A student debt consolidation loan is a means of consolidation of all loans of a student in to a single loan with an affordable monthly payment plan. Mostly, all your previous student loans are written off and a new loan is created which is to be paid every month in installments.
Benefits of Student Loan Consolidation
The benefits of a federal school loan consolidation are as follows:
- Lower Monthly Payments
When you consolidate all your loans in to a single one, only one loan has to be paid off every month instead of multiple student loans, and hence the monthly installment is lower.
- Single Loan To Pay
It is more convenient to manage only one loan, rather than numerous student loans with different deadlines for monthly payments. Also, if you are managing multiple loans, there are chances that you may miss one of them. It is always better to opt for school loan consolidation, if you are still in school.
- Low Interest Rate
When you consolidate your loans, you are able to take the advantage of low, yet fixed interest rates. Legally, student loan consolidation rates cannot exceed 8.25%.
- No Processing Fees
You are not required to submit a credit card check or any kind of processing fees when you apply for a loan consolidation. Even if you go for credit card debt consolidation, the rules remain the same.
- Electronic Payment Of Loans
It is not necessary to make payments online, but it is recommended that you do so, because many lenders knock off 0.25% off your loan, if you make the payment electronically. Also, this would help you in keeping regular track of your payments and you will not forget to pay on time.
Qualifying for a student loan can be confusing at times. Legally, students who are in their grace period or the ones who are still in school qualify for a student loan consolidation.
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