Knowing Everything About the Federal Consolidation Loan
There are different types of student loan consolidation. Consolidating student loan has been a way for parents or students to pay several student loans in one manageable account. This will definitely help these people to settle their loans at the most flexible term that they can pay. Federal consolidation loan is one of these types.
However, even before you start consolidating loans through a federal consolidation loan, you have to make sure that you know the types of loans that you can consolidate. You can consolidate Stafford loans, federal Grad PLUS loans, federal nursing loans and health professions student loans. You also have to know that you do not have to consolidate all your loans. You can just choose some of them and then consolidate it.
Federal consolidation loan has both its advantages and disadvantages. On the advantages side, it can give you a lower and a more fixed amount. Simultaneously, you can even get up to more than 10 years in order to make your monthly payments lower that it was. Getting a fixed rate is the main reason why consolidating student loans are making payment terms much easier.
The down side of federal consolidation loan however is that even if you have a fixed rate, it can still result to a higher rate and higher charges in the end. With this, you would still have to pay a lot in the process only at a manageable way of paying. Aside from this, this might also make you lose your eligibility on other types of loans like deferment programs. You might also not be eligible for forgiveness programs. Eligibility to other forgiveness provisions may also be lost.
So even before you do consolidate the student loans, it is very important for you to research on this topic first so you will know the things that you should expect. This should include the process of consolidating plus the people involved and the types of loans that are advantageous to consolidate than those that will make you lose some of your eligibility.
Without a doubt, federal consolidation loan is a good help for people who wants to manage their loans properly. This can make things lighter as you’re just looking at one loan, once agreed upon terms and one duration of payment. And with all the consolidation types available, you can surely find one that will definitely be of help to your finances and to your studies as well.