Consolidating with great lakes

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A Federal Consolidation Loan combines multiple federal student loans into one new loan with a single student loan payment.The new loan will have a new interest rate, new terms and conditions.The key terms for federal consolidation loans do not vary by lender: no application or origination fees are allowed and there are no prepayment penalties.Federal law sets the period of time for paying back the loans and sets a ceiling on the interest rate.Consolidating your federal loans through the Department of Education is free; steer clear of companies that charge fees to consolidate them for you.

[Back to top] Applying for consolidation takes most borrowers less than 30 minutes, according to the Federal Student Aid website.Federal student loan consolidation basics How to consolidate federal student loans Benefits of federal consolidation Drawbacks of federal consolidation Private student loan consolidation (student loan refinancing) When you consolidate federal loans, the government pays them off and replaces them with a direct consolidation loan.You’re generally eligible once you graduate, leave school or drop below half-time enrollment.Private consolidation lenders, on the other hand, are not subject to those terms and may include variable rates and any number of fees.What's more, some benefits of a federal consolidation loan, such as interest subsidies on deferred loans, are not available on private loans.

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