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| Understanding Your Student Loan Consolidation Program Options |
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| Written by Dennis Powell |
| Saturday, 14 February 2009 09:55 |
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So you've worked your tail off for the last several years eating Ramen and pulling all nighters while living on your student loans that almost covered the bills, and now you've got a great job, a new life and a mountain of debt. Life next pop quizWhat do you do? Fortunately for today's education Loan borrowers there are plenty of options to help you get your new life started without having the old one hanging around your neck like an anchor. There are plenty of student loan consolidation options available for the savvy borrower, and one of them will probably fit your life. Most people start their borrowing with a Federal Family Education Loan or FFEL. FFELs cover both subsidized and unsubsidized loans, and an FFEL consolidation loan can wrap both of a borrower's federal loans into a single manageable package. FFEL consolidation programs offer extended repayment terms and fixed rates, and in some cases even those who have been in default in the past can qualify. If you have any federal education debt an FFEL consolidation loan should be the first place you look. In addition to traditional federally funded loans, many students finance their advanced education with a variety of private loans. Private consolidation of these loans offers borrowers many of the same benefits as federal consolidation - fixed rates, longer terms, and lower payments. Conditions may be stricter for a private consolidation and you cannot usually combine private and federal loans under a single consolidation package. You may end up with two consolidation loans, one for your federal debt, and one for private; be sure to shop around for the best rates. PLUS loan consolidation offers the chance for parents who have borrowed to fund their child's education to get many of the same benefits as FFEL and private loan consolidation. In addition to an interest rate reduction Plus loan consolidation offers the option of extended terms to make repayment more manageable. As with any consolidation loan, extended terms also increase the total amount of the loan so borrowers need to make sure that they are making the right choice for their financial situation. Another option to a traditional loan is an additional mortgage on a piece of real property like a house of land that you may own. Some students parents will take this option to pay off the loans and the student can they make payments directly to mom and dad. Private personal loans from family members are yet another possible way to get the worry of several large monthly payments off your back, and some businesses offer tuition reimbursement for their employees. New technologies have come to the lending world where the idea of peer-to-peer programs and micro-financing has taken root. Peer to peer financing allows the borrower to present a request for funding to a group of potential "micro-investors" who then bid on the loan by offering different rates and terms. Once a deal is struck the network services the loan, ensures payments are made and the necessary paperwork is taken care of. For borrowers with needs outside the comfort zone of traditional banks a P2P loan may help them get started down the path to getting their loans paid off. Making the transition from school life to your career is a road with more than its share of lessons and challenges. Having to make large student loan payments on an entry level salary while trying to save cash for a professional wardrobe, deposits on housing, and other "grown-up" essentials is enough to stop that progress dead in its tracks. There are many things to consider when applying for a consolidation, but knowing that you have options available can help make your transition manageable. About the Author: Dennis Powell writes about alternative consolidation loans for students as well as low interest student loan consolidation programs. Kindly provided by LJ-Marketing.dk You are welcome to use this article on your own website, if you include the link just before this text. |
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