School Loan Consolidation!
Federal School Loan Consolidation Could Help Make Recent Graduates’ Student Loan Repayment Easier to Manage
If you graduated in May with student loans, you might be facing six-month grace periods which are ending at some point this month. Once your grace time periods are over, you’ll be entering payment for those student loans that were in deferment.
If you’re looking at multiple student education loans starting pay back, you’ll soon probably experience juggling numerous bills, several due dates, and numerous monthly payments. But you could help make your education loan repayment much easier to control by consolidating your eligible government student loans with a Federal Consolidation Loan.
How Federal School Loan Consolidation Works
A Federal Consolidation Loan packages all of your qualified federal student loans into one single loan with one monthly bill and one convenient monthly payment. To become qualified for student loan consolidation, you can’t currently be signed up for school more than half time, as well as the student loans you wish to consolidate have to be in repayment, in a leeway period, or perhaps in an authorized forbearance or deferment period.
Should your parents have Federal PLUS Loans which they took out to assist you pay for school, they’re also eligible to consolidate. And your mother and father don’t have to wait for you to graduate in order to consolidate their particular PLUS loans: Parents can consolidate the PLUS loans they took out for your education once the loans are fully disbursed and also have entered pay back, even if you’re still in school. Your folks can consolidate their parent PLUS loans, however , you won’t have the ability to consolidate your own student education loans along with your parents’ loans.
Advantages of Federal Student Loan Consolidation
1. No fees and no cost to apply
2. No credit checks and no co-signers required
3. No prepayment fees and penalties
4. Fixed annual interest rate
5. Repayment terms up to thirty years
6. A single monthly installment for your qualified federal student loans
There’s never any charge to obtain a Federal Consolidation Loan, and there are no credit checks or co-signers required. There are also no early repayment charges, so you never be billed for paying in excess of the minimum each month or for paying off your student loan consolidation early.
School loan consolidation provides you with the security of a set interest rate: With a fixed rate, you will lock in your monthly payments once you consolidate, therefore you’ll never need to be worried about variable interest rates rising, causing you to be speculating regarding your monthly payment amount.
Consolidating your federal student loans may also give you a longer period to repay—a Federal Consolidation Loan could extend the repayment term for your student loans by up to twenty years. And also stretching out your payments spanning a lengthier reimbursement term, a student loan consolidation may lower the amount you need to pay every month. By consolidating, you may be in a position to cut your monthly student loan payments up to 50 percent!
Consolidating Your Private Student Loans
If you have private student loans in addition to (or instead of) federal student loans, you won’t be able to combine the private loans with the federal student loan consolidation plan. But if you’re interested in the same comfort of a single consolidated bank loan for your private student loans, you might be eligible to consolidate your private loans separately with a Private Consolidation Loan.
What You Should Know About FAFSA
The FAFSA, or Free Application for Federal Student Aid, is the first step in the financial aid process. In order to qualify for a student aid loan you will need to complete the FAFSA application.
If you currently have student loans and are planning on doing a school loan consolidation, you will probably not need to complete the FAFSA again.
The FAFSA online application will ask income history and other important information. After submitting the application, it will be processed by the Department of Education. Once they have determined what aid you qualify for, you will be sent a Student Aid Report (SAR). An electronic copy of your SAR is also made available to the schools you’ve listed on your FAFSA.
The Student Aid Report will show what types of aid you qualify for, including federal and state grants, such as the Pell grant, Stafford loans, and parent loans.
If you were awarded student loans or parent loans, you will then complete the application process for the specific type of loan you qualified for. Generally the funds are transferred to the college, and you will receive a disbursement during registration if your awards were above the cost of tuition and fees. These disbursements can take up to 45 days from the time they are issued.
