To most of the fresh graduates out there, it is a painful issue to pay back the loans they have taken to support their college or university studies. If you are currently paying multiple interest rates to multiple loan agencies, you should know how that feels. Have you ever imagine that you can save thousands of dollars by consolidating your student loans? In fact, you can either go for federal student loan consolidation or private student loan consolidation.
Loan agencies
As the name implies, federal loan consolidation is offered by the federal government. It doesn’t need credit check or co-signer (guarantor) because this loan consolidation program is protected by the federal government.
Private student loan consolidation is offered by banks, loan agencies or credit unions. And depending on the loan agencies, you might need to provide a co-signer or get your credit history check.
How they work
Both programs are meant to combine the multiple loans you have into one loan and extend your loan period so that you can enjoy lower monthly payment. For federal student loan consolidation program, you can only combine your federal loans. But for private student loan consolidation, it is possible to consolidate your student loans together with your personal loans.
Besides that, when you are going for federal student loan consolidation, your interest rate will be lock at the current low interest rate for the whole loan period. For private student loan consolidation however, your interest rate might fluctuate with the market rate. You can try to talk to the loan agency to look at the possibility of getting the lowest interest rate.
Advantages
You can improve your credit score when you consolidate your student loans with both programs. This is because when you have consolidated your loans, you are being seen as servicing one single loan instead of multiple loans.
Source
Monday, August 31, 2009
Monday, August 17, 2009
Sorting Your Web Of Debt With Acs Student Loan Consolidation
Of all the mistakes you can make as a student, one stands high above the others; falling behind on your student loan debt and defaulting. This is something that can follow you well into your professional career. With ACS student loan consolidation, though, you can sort through the loans and give yourself the ability to relax and breathe a little easier.
If your student loans are so high that just doing the math gives you a major headache, ACS student loan consolidation can combine all your loans into only one or two loans, and use one simple account for you to make payments.
If you are in danger of defaulting on your student loans, consolidation is something well worth considering. Defaulted loans can have negative effects on your credit and finances, and these effects last for years, well after you have graduated.
If it has been long enough since you defaulted, the federal government can actually deduct 15 percent of your paycheck to repay your student loans. The United States Treasury can also take your tax refunds and apply them towards your student loan balances as well. Beyond these acts, your defaulted loans also appear on your credit report, which can prevent you from being able to buy a house or car, credit card, and in some cases can work against you when trying to get a job or rent an apartment.
ACS student loan consolidation can be applied for using the web, and through their website you will be able to manage your loans. Using their ExpressPay service, you can even pay your loans right through the site as well. The ACS student loan consolidation application process is entirely paperless,instead relying on electronic signatures to sign legal documents.
Student debtors may apply for three types of ACS consolidation programs. There is a Stafford loan program, which is for undergrad students applying for a loan for themselves. There is a Graduate Plus loan, for grad students applying for a loan on their own behalf. Lastly is the Parent Plus loan, which is for parents and legal guardians applying for a loan on behalf of a student.
Source
If your student loans are so high that just doing the math gives you a major headache, ACS student loan consolidation can combine all your loans into only one or two loans, and use one simple account for you to make payments.
If you are in danger of defaulting on your student loans, consolidation is something well worth considering. Defaulted loans can have negative effects on your credit and finances, and these effects last for years, well after you have graduated.
If it has been long enough since you defaulted, the federal government can actually deduct 15 percent of your paycheck to repay your student loans. The United States Treasury can also take your tax refunds and apply them towards your student loan balances as well. Beyond these acts, your defaulted loans also appear on your credit report, which can prevent you from being able to buy a house or car, credit card, and in some cases can work against you when trying to get a job or rent an apartment.
ACS student loan consolidation can be applied for using the web, and through their website you will be able to manage your loans. Using their ExpressPay service, you can even pay your loans right through the site as well. The ACS student loan consolidation application process is entirely paperless,instead relying on electronic signatures to sign legal documents.
Student debtors may apply for three types of ACS consolidation programs. There is a Stafford loan program, which is for undergrad students applying for a loan for themselves. There is a Graduate Plus loan, for grad students applying for a loan on their own behalf. Lastly is the Parent Plus loan, which is for parents and legal guardians applying for a loan on behalf of a student.
Source
Monday, August 3, 2009
Student Loans: Easing the Burden - loan consolidation
Get a break on your payments so you can manage your other debt, too.
It's payback time for students who graduated from college last spring owing money on federal student loans. Your six-month-long grace period is about to end, and the money you owe--an average of $16,600 for undergraduates 18 to 25, according to Nellie Mae, a major student-loan provider--is looming large. The burden is still heavier when you add on credit card debt, which Nellie Mae says averages $2,000 for the same group of students, and maybe even payments you're making on a new car. What's the best way to balance the load?
Rebecca Carter has a plan. Carter, 31, is a veteran of student loans, having repaid about $7,500 from her first stab at college a decade ago. Two years ago she returned to school to complete her degree in business administration at Eastern Nazarene College, in Quincy, Mass.; she graduated in August with $23,000 in outstanding loans.
Carter is wiser, if not richer, the second time around. Before she begins repayment next March, Carter plans to consolidate loans from three lenders (with interest averaging about 7.5%) into a new loan from a single lender, and to extend the payment term from the standard ten years to 20 years. Carter estimates that loan consolidation will reduce her monthly payments 40%, so that she'll pay between $200 and $250 a month. That will give her breathing room to make payments on her more-expensive car loan at 11%.
Once the car is paid off, she hopes to put the extra money toward the student loans and still repay them in ten years. "I understand debt a lot better this time around because I've lived it," says Carter, who is also a manager of loan origination at Nellie Mae.
A WINNING STRATEGY. Carter's plan to knock off her more-expensive loan first and then concentrate her resources on her remaining debt is a winner, says Amy Cole, an educator at the Consumer Credit Counseling Service of Southern New England. A credit card charging 18% interest is a heavier burden than a student loan: The highest rate on student loans currently outstanding is 8.25%. If student loans are your only liability, focus first on those with the highest rate. Even if your budget is tight, don't rule out investing some of your resources if you can earn a higher return than the interest rate you're paying on your loan.
The standard repayment plan for student loans calls for equal monthly payments and a ten-year payback period. If that's more than you can afford, call your lender before the grace period ends to ask about other repayment options. For example, Carter is a prime candidate for loan consolidation because she owes money to three different lenders at different rates. With the consolidated loan, the interest rate will be a weighted average of all the loans, rounded up by one-fourth of a percentage point. Variable rates for government-sponsored Stafford loans are unusually low now, so consolidating locks in an attractive rate. Once you're locked in, however, you're stuck if the Stafford rate happens to drop in the future.
Source
It's payback time for students who graduated from college last spring owing money on federal student loans. Your six-month-long grace period is about to end, and the money you owe--an average of $16,600 for undergraduates 18 to 25, according to Nellie Mae, a major student-loan provider--is looming large. The burden is still heavier when you add on credit card debt, which Nellie Mae says averages $2,000 for the same group of students, and maybe even payments you're making on a new car. What's the best way to balance the load?
Rebecca Carter has a plan. Carter, 31, is a veteran of student loans, having repaid about $7,500 from her first stab at college a decade ago. Two years ago she returned to school to complete her degree in business administration at Eastern Nazarene College, in Quincy, Mass.; she graduated in August with $23,000 in outstanding loans.
Carter is wiser, if not richer, the second time around. Before she begins repayment next March, Carter plans to consolidate loans from three lenders (with interest averaging about 7.5%) into a new loan from a single lender, and to extend the payment term from the standard ten years to 20 years. Carter estimates that loan consolidation will reduce her monthly payments 40%, so that she'll pay between $200 and $250 a month. That will give her breathing room to make payments on her more-expensive car loan at 11%.
Once the car is paid off, she hopes to put the extra money toward the student loans and still repay them in ten years. "I understand debt a lot better this time around because I've lived it," says Carter, who is also a manager of loan origination at Nellie Mae.
A WINNING STRATEGY. Carter's plan to knock off her more-expensive loan first and then concentrate her resources on her remaining debt is a winner, says Amy Cole, an educator at the Consumer Credit Counseling Service of Southern New England. A credit card charging 18% interest is a heavier burden than a student loan: The highest rate on student loans currently outstanding is 8.25%. If student loans are your only liability, focus first on those with the highest rate. Even if your budget is tight, don't rule out investing some of your resources if you can earn a higher return than the interest rate you're paying on your loan.
The standard repayment plan for student loans calls for equal monthly payments and a ten-year payback period. If that's more than you can afford, call your lender before the grace period ends to ask about other repayment options. For example, Carter is a prime candidate for loan consolidation because she owes money to three different lenders at different rates. With the consolidated loan, the interest rate will be a weighted average of all the loans, rounded up by one-fourth of a percentage point. Variable rates for government-sponsored Stafford loans are unusually low now, so consolidating locks in an attractive rate. Once you're locked in, however, you're stuck if the Stafford rate happens to drop in the future.
Source
Monday, July 20, 2009
Student Loan Consolidation
According to The College Board, an estimated 60 percent of bachelor's degree recipients obtain loans to fund education, with an average total debt of $22,700 for 2006-07 graduates. If you have student loan debt, paying off your loan(s) is crucial. Repayment affects your credit rating (both positively and negatively) and your credit rating can affect your ability to buy a car or even find a good place to live. Consolidating your student loans may be one way to help you repay your loan(s).
Like a home owner who refinances a mortgage, you can refinance or consolidate your student loans to lower your monthly payment or combine several loan payments into a single monthly payment. Keep in mind however, that consolidation loans use a weighted average interest rate, which may lower the interest rates on some of your loans and increase the interest rates on others. Also if you extend your repayment period, you'll end up paying more interest in the long run.
Source
Like a home owner who refinances a mortgage, you can refinance or consolidate your student loans to lower your monthly payment or combine several loan payments into a single monthly payment. Keep in mind however, that consolidation loans use a weighted average interest rate, which may lower the interest rates on some of your loans and increase the interest rates on others. Also if you extend your repayment period, you'll end up paying more interest in the long run.
Student Loan Consolidation Services
Consolidating your student loan and lowering your monthly loan payments can give you more discretionary income each month. If your loans are almost paid in full, consolidation is not a good idea but it might be a good option if:- You are currently making multiple monthly payments or payments to different lenders
- Your loan payments are high compared to your income
- The interest rate on a consolidation loan is lower than the rate on your loan(s)
Source
Monday, July 6, 2009
Why You Should Consider Consolidating Your Student Loans
If you have more than one outstanding student loan to service, there are a few things which you should consider if you are thinking of consolidating all your outstanding student loans:
Consolidation basically means the act of combining a few things together. One of the benefits of consolidation of student loans allows you to combine all your outstanding student loans into one single account. In such a scenario, you are looking at only having to manage the monitoring of one single loan account and one single monthly payment. The likelihood of missing out on your repayment due to having to monitor a few student loan accounts is thus minimised.
When you apply to consolidate your student loans, you might also gain the advantage of being able to negotiate for a better interest rate since the financier is now potentially looking at “grabbing” the loan business from its business rivals. For instance, let’s say you are servicing 3 student loans from 3 different financiers wherein the interest rates range between 8 to 13% per annum. You then approach a new financier and apply to transfer all these student loans into a new loan account with them. The new financier might be persuaded to give you a rate below 8% so as to conclude this lending business with you and thus, deprive the other 3 financiers from continuing their “interests profits” should you continue borrowing from them.
Another benefit of a consolidation loan is to renew student loan deferment rights. If you are out of college or university and are having difficulty servicing your monthly loan payments, a consolidation loan may give you a temporary relief.
As in all things, before embarking on the decision to consolidate your student loans, you should also consider the cost benefits. Discuss with your financiers to see if the cost of consolidating your student loans would be cheaper than maintaining status quo. Find out what are the hidden costs involved in consolidating student loans and whether such a consolidation would result in a longer repayment period. If at all the repayment period is extended, then make sure you calculate the overall amount of interests paid by the end of the tenure to see if you would be saving some money through this consolidation exercise.
Source
Consolidation basically means the act of combining a few things together. One of the benefits of consolidation of student loans allows you to combine all your outstanding student loans into one single account. In such a scenario, you are looking at only having to manage the monitoring of one single loan account and one single monthly payment. The likelihood of missing out on your repayment due to having to monitor a few student loan accounts is thus minimised.
When you apply to consolidate your student loans, you might also gain the advantage of being able to negotiate for a better interest rate since the financier is now potentially looking at “grabbing” the loan business from its business rivals. For instance, let’s say you are servicing 3 student loans from 3 different financiers wherein the interest rates range between 8 to 13% per annum. You then approach a new financier and apply to transfer all these student loans into a new loan account with them. The new financier might be persuaded to give you a rate below 8% so as to conclude this lending business with you and thus, deprive the other 3 financiers from continuing their “interests profits” should you continue borrowing from them.
Another benefit of a consolidation loan is to renew student loan deferment rights. If you are out of college or university and are having difficulty servicing your monthly loan payments, a consolidation loan may give you a temporary relief.
As in all things, before embarking on the decision to consolidate your student loans, you should also consider the cost benefits. Discuss with your financiers to see if the cost of consolidating your student loans would be cheaper than maintaining status quo. Find out what are the hidden costs involved in consolidating student loans and whether such a consolidation would result in a longer repayment period. If at all the repayment period is extended, then make sure you calculate the overall amount of interests paid by the end of the tenure to see if you would be saving some money through this consolidation exercise.
Source
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