Re consolidating private student loans
If any of the loans you want to consolidate are still in the grace period, you have the option of indicating on your Direct Consolidation Loan application that you want the servicer that is processing your application to delay the consolidation of your loans until closer to the grace period end date.If you select this option, you won’t have to begin making payments on your new Direct Consolidation Loan until closer to the end of the grace period on your current loans.Direct PLUS Loans received by parents to help pay for a dependent student’s education cannot be consolidated together with federal student loans that the student received.A Direct Consolidation Loan has a fixed interest rate for the life of the loan.
If you recently graduated from college, you’ve probably been getting letters from student loan servicing companies asking if you’d like to consolidate your student loans. In this piece, we’ll explain what it means to consolidate student loans, compare student loan consolidation with student loan refinancing, and help you decide if consolidating your student loans is the right move for you. Here’s an example: Let’s assume you have 3 federal student loans of ,000, ,000, and ,000, respectively. When you apply for a Direct Consolidation Loan, you don’t have to consolidate all of your eligible loans. If consolidation would cause you to lose the benefits associated with some of your current loans and you are working toward earning those benefits, you should not include those loans in your new Direct Consolidation Loan.Because the interest rate on the new loan is the weighted average of the loans you combine, your new loan’s rate would be 4.11%. So, why would you even want to consolidate your federal student loans?Here are some reasons student loan consolidation may be for you: If consolidating your loans doesn’t seem like the right fit, refinancing your student loans may be a better option.