Should I Consolidate My Student Loans?

Do you currently have several student loans? Do you need help figuring out if student loan consolidation is the best option for you? Don’t stress, we’re here to help you make your decision easier!

Here at US Student Loan Center we help student borrowers with student loan consolidation. Direct loan consolidation allows you to combine multiple federal education loans into one loan.

First of all you should know that you can consolidate pretty much all kinds of federal student loans like Subsidized and Unsubsidized Stafford Loans, PLUS Loans, and Perkins Loans, including most federal loans in default. Although, be careful! Defaulted Direct Consolidation Loans can’t be reconsolidated, so you only get ONE SINGLE CHANCE to use consolidation to get out of default.

Also keep this in mind: Once your loans are combined into a Direct Consolidation Loan, they CANNOT be removed.

So before you make the decision to go ahead with consolidating your student loans, we want you to carefully consider the positives and negatives and make a smart decision.

We are providing you with some of the advantages and disadvantages of Student Loan Consolidation.

Advantages of Student Loan Consolidation:

Makes your life easier with just one onthly payment! You’ll have a single monthly payment and a single lender (the U.S. Department of Education) instead of multiple payments and multiple lenders.
You can consolidate your loans yourself for free, or hire a company like US Student Loan Center to help you in the process.
Fixed Interest Rate (Direct Consolidation Loans have a fixed interest rate, meaning your interest rate won’t change year to year. The fixed interest rate is based on the weighted average of the interest rates on the loans being consolidated, rounded up to the nearest one-eighth of 1%.)
Lower Monthly Payments. You may get a longer time to repay your loans, often resulting in lower monthly payments.
Consolidated loans offer a variety of options, including income-based repayment plans

Disadvantages of Student Loan Consolidation:

You’ll have the option of taking longer to repay your loans, so it could cost you more in the long run (since interest keeps adding up until you’re done).
If you consolidate while you are still in school (which is allowed under limited circumstances) you would lose your grace period.
If you are in default, your balance could go up after you consolidate, because collection fees will be added to the loan. But at least you will no longer be in default!
You lose some borrower benefits you had when you first took out your loans (i.e. interest rate discounts, rebates)
You can’t consolidate your private student loans with federal student loans.

If you are really struggling to make your student loan payments right now, then a student loan consolidation may be a good idea, it could save you in the short term but might cost you more in the long terms.

In weighing your options, be sure to compare your current monthly payments to what your monthly payments would be if you consolidated your loans.

If you want more information about student loan consolidation, reach out to us! Contact one of our expert student loan counselors right now by dialing 877-433-7501. They will answer any questions you may have and help you make an informed decision based on your specific case.