student loans

Student loan consolidation tips

You are about to graduate from college, or you recently did. What should you be doing with your student loans? Besides paying them back, now is the perfect time to look into consolidating your student loans too. There are a large number of private companies that will help you consolidate your student loans at a lower rate. I’m pretty sure that you’ve received some type of letter asking you to consolidate your student loans at a lower rate. They tell you that if you consolidate with them, you can save money and pay off your loan in a faster amount of time. This is not the always the case. Sometimes students don’t save and payments take longer than expected.

Federal student loan consolidation can make it a lot easier for many students to stay on top of their loan payments. The current interest rate on student loans for July 2005 to June 2006 is 5.3% for Stafford loans and 6.1% for PLUS loans. These numbers are definitely higher than the rates that were being offered last year.

What should you do since the rates are high for this year? The choice is up to you. You can either go with an independent consolidation company or you can gamble. If you lock in your rates according to this year’s rates, you might miss out if the rates decrease next year.

Requirements for Federal Student Loan Consolidation

The most common mistake made is extending the current loans. A lot of people really believe that by extending their current loans, they will save and receive the same perks as consolidating. An extension will really increase the overall amount of interest pay, while consolidation may reduce that same amount. Besides the lower monthly payments, student loan consolidation offers many more benefits. Discounts are offered to people who have a balance exceeding $10,000, and lenders give a small percentage discount to anyone who makes a certain amount of consecutive payments.

In order to qualify for a student loan consolidation you typically must have $7,500 or more in student loans. If your credit is bad, your chances of being approved for consolidation will decrease.

student loans

How to find information on past student loans

While you were in college getting your education, you took out a bunch of loans to help you finance it. Now that you have graduated it is time to start paying them off. A lot of people do not know what happened to their loans once they graduate and end up defaulting. If you don’t know when or where to send payments, it is very important that you find out before you end up defaulting on your student loans. You should first check with the loan servicer. The servicer should provide you with contact information of the lender.

If you cannot get in contact with the loan servicer, or if the servicer is unable to provide you with the information requested, there are a few other places where you can look for help. Check with your school financial aid office for your lenders contact information. If you took out a Federal Perkins loan, the financial aid office should have all of the payment information that you need.

You can also try searching for your student loan information in the National Student Loan Data System. The National Student Loan Data System contains information on Pell Grants and federal student loans. In order to fully utilize the National Student Loan Data System, you will need to provide it with certain personal information. You will need to provide your social security number, date of birth, and your Federal PIN number. Your federal PIN number is the same number used in FAFSA application.

The last resources for finding information pertaining to your student loan is the National Student Loan Clearinghouse, Elmnet, and credit bureaus. The NSLC provides a free loan locator for Federal Family Education Loan program participants. Elmnet provides information for FFELP participants. Last but not least, you may contact your credit bureaus for a credit report that will give you information on your open student loans.