I Need To Consolidate My Student Loans

Q: What is the first step to take for student loan consolidation? I want lower monthly student loan payments, and was told to consolidate all of my student loans. If i need to consolidate my student loans, where should I start?

A: The first step to take, is to determine if student loan consolidation is right for you and your specific financial needs. Student loan consolidation can lower your monthly student loan payments, but in doing this, the repayment period of you loan is often extended (meaning you could end up paying more over the lifetime of the loan). Once you have determined that student loan consolidation is the right fit for you, you will need to follow the “golden rule” of student loan consolidation which is: never consolidate your federal student loans into a private student loan consolidation. You must consolidate your federal student loans into a federal consolidation loan, and your private student loans into a private consolidation loan. If you were to consolidate your federal student loans and your private student loans into a private consolidation loan, you would forfeit all of your federal student loan benefits.

For your federal student loans, you will want to start by applying with Federal Direct Consolidation Loans at www.loanconsolidation.ed.gov. This site will provide you with applications and information on federal student loan consolidation. For your private student loans, you can start by asking your current lender if they offer consolidation loans. With private student loan consolidation, you may want to compare a few different lenders to determine what private student loan consolidation is best for you. To read more on student loan consolidation, view The 10 Best Student Loan Consolidation Tips.