Best student loan consolidation-how to get the best deal possible?
Many students come out of school with at least five to six loans hovering on their heads. This means that after the six-month grace period from the date you graduated, payments for each of your loans will start. Each of those loans will usually carry their own interest rate and a separate date for the repayment check to come in, which will make it difficult for the student to remember to pay off on the correct day. Finding the best student loan consolidation program can help you pay less each month and put an end to your misery.
How to find the best student loan consolidation plan?
1. Interest rate- Very, very, important! Remember you are consolidating your loans because the split amounts are much larger with a larger interest rate. Your consolidated loan should be able to provide you the best and minimal interest rate possible to cut down the thousands upon thousands you pay every month.
2. Payment schedule -If youâ€™ve promised to pay off your student loan in three years than do so. I agree that finances cant be strong every year and there will be ups and downs but if you feel that such a situation will arise then please make sure that you extend your repayment schedule. Find a consolidation company, which will adjust, to your requirements with a good interest rate and flexible payback options and not the other way around.
3. Be sure that the loan you decide to go back is willing to agree on a forbearance or restricted payback amount for a time when you are in a financial bind or a tight situation.
4. Make sure the interest rate is fixed so that your payment will always be something that you afford.
5. Make sure there is no penalty for making early payments or for paying the loan off early. Always be sure to pay more than the minimal amount if you have some handy cash, you may also want to pay off the consolidated loan completely, so please make sure that the company you choose offers that option..
6. Defaulting on your loan can damage your reputation and credit standing with finance companies, making it harder for you to qualify for credit cards, apartments, car loans, leases, and other needs. Consolidation can help you reduce your monthly payments and prevent you from defaulting on your loans.
7. Student consolidation loans have easy applications, as many companies require no credit checks and no application or processing fees. You can easily consolidate all your loans with private lenders and companies.
Although consolidation is a good thing there many fly-by night companies who will promise you the world and then deliver nothing, so here are few things to be careful of while choosing a consolidation company,
1. Most people apply for their loan consolidation online but some companiesâ€™ request exclusive online communication, which may not be possible. If this is the case, watch out! If your email is deemed undeliverable twice in 48 hours, you may lose any benefits and discounts you accrued while consolidating the loans
2. Many lenders will advertise â€œspecial benefitsâ€ such as a 0.6% discount
for consolidating while you are still in your six-months grace period. These are the benefits, which are due to you by law and cannot be advertised as special discounts.
Other consolidation benefits that are due to you legally are , fixed interest rates with no fees and no credit checks with no prepayment penalties. And rates should be 0.6% lower if you consolidate while in your grace period.
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So the best student loan consolidation is a good deal for the struggling student as well as the lenders. But like shopping for clothes, be sure to get the right fit for you before you select the best student loan consolidation program available in the market.