Student Loan Consolidation

Do you need to consider applying for Student Consolidation Loans? In a recent study taken by the National Center for Education Statistics, over 70 percent of all students require financial aid for their education. Many students find that after obtaining their college degree, the monthly payments for the loans are beyond their financial means.

Graduates that find themselves having financial difficulties may find it necessary to seek out alternative means to manage their finances. Consolidation Loans may provide students an effective way of combining payments into one loan, and reduce their financial burden.

Do you want to apply for Consolidation Loans?

There are several Student Consolidation Loans available, which are relatively structured by the type of loans the student has. For instance, if a student has loans through one of the Federal Loan programs, such as the Federal Family Education Loan Program (FFELP) or the Federal Direct Student Loan Program (FDLSP), they may apply for Federal Consolidation Loans. However, if the student loans are from a private lender or a banking institution, then they should apply for Private Consolidation Loans.

More information on Student Consolidation Loans:

• Student Consolidation Loans
• Federal Direct Consolidation Loans
• Private Student Consolidation Loans
• Graduate Student Consolidation Loans

Student Loans have become an integral part of the pursuit of a higher education. However, the skyrocketing costs of obtaining a higher education have put a large percentage of graduates into a precarious financial situation. In data taken from an industry report, the average amount of debt for graduate and professional students is between $27,000 to $114,000 after graduating. The average amount of debt for the majority of undergrad and graduate students is over $42,000.


Are you interested in applying for Federal Direct Consolidation Loans? For students that have too much financial burden from Student Loans, there are options for having to consider drastic measures such as bankruptcy or default. There are many advantages for students that choose to take Federal Direct Consolidation Loans.

Federal Direct Consolidation Loans are very effective tools for reducing the amount of debt on student loans. Some of the benefits that Federal Direct Consolidation Loans offer are listed below:

  • One monthly payment – With Federal Direct Consolidation Loans the borrower need only pay one lender for the loan – The Federal government.
  • Easy payment options – There are four repayment options available to fit each borrower’s individual financial situation. Furthermore, at any time during the repayment of the loan, the borrower may switch to a more suitable repayment plan.
    Lower monthly payments – The monthly payment required for Federal Direct Consolidation Loans is typically lower than the combined total of the individual loans.
  • Subsidy retention – For loans that have subsidy benefits, the subsidized portion of Federal Direct Consolidation Loans retain the subsidy benefits of the previous loan.

Interest rates associated with Federal Direct Consolidation Loans are based on a weighted averaging of the total interest of all the loans combined. This may in effect reduce the cost of the combined loans so that the required monthly payment amount. Another benefit which is provided by Federal Direct Consolidation Loans is that there are no fees or charges applied for consolidation – consolidation is free. Moreover, both parents and students may choose to consolidate their loans.

With Federal Direct Consolidation Loans, there are no minimum amounts required to qualify for the loan. However, private consolidation loans may require that there be a minimum balance – the usual minimum amount is between $5,000 and $7,500. It may be necessary to contact the lender to determine if there are any terms and conditions for their Consolidation Loans.


Do you want to apply for Private Student Consolidation Loans? For students that are interested in consolidating their educational loans, Federal Student Consolidation Loans should be the first type of loan which students attempt to obtain. However, it is not recommended to combine Private Student Consolidation Loans with Federal Student Consolidation Loans, and it may be necessary to speak to the loan provider in order to determine their specific requirements on loan consolidation.

Some of the other types of Student Consolidation Loans are:
• FFELP Consolidation Loans
• FDSLP Consolidation Loans

Private Student Consolidation Loans do not hold the same level of benefits as do the Federal Consolidation Loans such as lower interest rates, easy repayment options, lower monthly payments and subsidy retention. The interest rates for Private Student Consolidation Loans are generally assessed at the same interest rates as a home equity loan, and unlike the Federal Consolidation Loans, may be offered at a fixed or a variable interest rate.

Another important thing to consider with Private Student Consolidation Loans is that there may be fees, charges, and penalties associated with default or late payments which may significantly increase the total loan amount. Some of the benefits of Private Student Consolidation Loans are that they do not require the student or the parent to file a FAFSA and that there are no set limitations to the loan amount which may be consolidated.


Are you interested in applying for Graduate Student Consolidation Loans? For students that have received their graduate degrees and are now trying to save money, Graduate Student Consolidation Loans may be the right financial instrument to quell the high monthly payments from Federal Stafford loans, Federal PLUS loans, Federal Perkins Loans and even through Private Graduate Student Loans.

Graduate Student Consolidation Loans are available for both the FFEL program and the FDSL program. Listed below are some of the other types of Federal Student Loans which may be eligible for consolidation:
• Federal Stafford Loans
• Federal Graduate Stafford Loans
• Federal Perkins Loans
• Federal PLUS Loans
• Federal Grad PLUS Loans

There too are options for Private Graduate Student Loans to be consolidated as well. However, it is not recommended to consolidate Federal Student Loans with Private Student Loans – the interest rates and the inherent benefits associated with Federal Loans do not apply to Private Loans. Though their area many private lenders that will offer Graduate Student Consolidation Loans, the rates are not competitive with that of the Federal Direct Student Consolidation Loans.

Over the past few decades, the cost of a Graduate or professional degree has increased substantially, where the Federal loan limits have remained virtually the same for over a decade. With the high educational costs and lack of Federal funding, many students are choosing to pursue private funding to pay for their education.

Though private lenders make it very easy to obtain a student loan, for those that qualify the benefits of the Federal Loan programs are significantly better and offer students many options to remedy their Graduate Student Consolidation Loans if financial difficulties arise during the lifetime of the loan.