Debt Consolidation

For Student Loans

If you're near the end of paying back your student loans, taking out a new loan may not be worth it. On the other hand, if you still have many payments and a lot of years ahead of you -- and you've exhausted deferment and forbearance options on your existing loans -- making a clean slate with a student loan debt consolidation may be just what you need.

Do you have to choose between which bills to pay each month? Are your outstanding debts standing between you and saving money for a house, a car, or a family? It doesn't make sense to go through the years incurring new debts, while dragging around old ones from college.

A Solution

Fortunately, there is a solution. You still have to repay your school loans, but student loan debt consolidation makes monthly payments to just one lender.

Think of it as refinancing. The money you borrow from one lender pays off all your other loans. You no longer have to juggle what and when to pay each month. And the interest rate on a student loan debt consolidation is the weighted average of all the old loans, lowering the overall payment. Some student loan debt consolidations are settled at a fixed rate for the duration of the loan, so you don't have to be concerned each year that your payment will increase.

There are 4 different student loan debt consolidation repayment plans available to consider. One of them is apt to be just what you need.
 
If a fixed-rate really appeals to you, consider either the Standard Repayment Plan or the Extended Repayment Plan. The Standard Repayment Plan allows you a maximum of 10 years to repay, but payments are evenly split within that time limit at a fixed interest rate.

Extended Repayment Plans relieve monthly payment amounts further by expanding the payment period to between 12 and 30 years, depending on the total amount owed. The interest rate is still fixed and the payments are still lower. Over the total period you will end up paying more money, but the lower monthly payments will be easier to manage.

The Graduated Repayment Plan also allows you repay your monthly student load debt consolidation payments over 12 to 30 years, but the amount of your monthly payment increases every 2 years.

The fourth plan, an Income Contingent Repayment Plan, appeals to a lot of people because it takes into account what's happening in your life. A reasonable monthly payment is assessed based on your annual gross income, family size, and total direct student loan debt. Another advantage of this student loan debt consolidation repayment plan is it spreads the payments out over 25 years.

There's no way around it. You took out student loans to pay for your education and now you have to pay the money back. That can be difficult to stay on top of, whether you're still in college, trying to start your career, or even working on it a decade later. Consolidating your payments into a manageable monthly budget can make this bearable.