Consolidating federal and private student loans

Because there is no way to “undo” a consolidation, any mistake you make is permanent.The huge advantage to federal loan consolidation is that you get to keep all of the perks associated with federal loans.Finally, you can only consolidate federal student loans into a federal loan consolidation.If you are hoping to convert your private loans into federal loans to get on IBR or qualify for student loan forgiveness, you are out of luck.The consolidation process can be started by applying through this portal from the Department of Education.Completing the application usually takes less than half an hour, but it is several weeks or even months before the entire process is complete.

The biggest downside is that federal consolidation is not the best strategy for some borrowers.The individual requirements and programs vary from company to company, so it pays to shop around.If you have a great credit score and a high income, companies like So Fi, Laurel Road, and Common Bond all offer rock bottom interest rates.Absent an act of Congress, this financial move is not possible.If you look at the private student loan consolidation companies on the market, you will see there is a wide selection and that interest rates can be just over 2%.

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