Introduction
College students are usually wrecking in very large debts when entering job markets due to the large loans they took to finance their studies. Most of the jobs these fresh graduates usually land pay them peanuts that may not be enough to pay for the loans they took while at the same time earn a decent living. Instead of enrolling to programs that would put loan repayments on hold, one can always decide to consolidate student loans. This usually binds all the loans that one may have together, pat off the old loans and even enable them acquire new ones at relatively low interest rates. This automatically translates into low monthly payments.
Step 1
To consolidate student loans is always a step in the right direction towards proper financial management. This always ensures that the student repays their loans in good times without defaulting. To ensure that one pays low interest rates after consolidating their loans, they need to have perfect timing when the consolidate student loans rates are minimal. This will ensure that a student pays very little on the interest for the loans they took.
Step 2
After deciding to consolidate student loans, they must always meet the consolidation requirements. One of the most important requirements for consolidation application to be successful is that one must not have defaulted in loan repayment in the past. This would ensure that they have very good credit scores and would enable the consolidation applications to be approved fast.
Step 3
Another requirement for one to consolidate student loans is that they must not have consolidated the same loan in the past. Having consolidated the same loan in the past would amounts to double consolidation that would make the consolidation request to be rejected. After applying for consolidation, one must always give the lender some time to verify if the loans could be consolidated. Before even trying to consolidate student loans, one must always know their own specific circumstances like the amounts they would comfortably pay per month.
Step 4
Not all loans will qualify for student loans consolidation. Private loans may not always be consolidated. Only the federal loans and the government sponsored loans may always qualify for consolidation.
Step 5
For married student who may wish to consolidate their students loans. It is always advisable that each one of them consolidate student loans individually. This is because when the couple separate, one would be forced to repay the loans they consolidated together even if they really never utilized them. Most of financial institutions also are not willing to consolidate couple student loans.
Tips
Before deciding to consolidate student loans, one must always remember that even though consolidating their loans lowers their monthly repayments, it stretches the life of one’s loans thus they may end up paying more on these loans. One can always cut their monthly repayments by very huge percentages; however, they may end up paying double for them with time. One of the most important benefits student loans consolidations is that it removes the co-signer. This can always remove one’s parents or guardian from liability.
Sources and Citations
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