Direct Student Loan Consolidation: The Advantages

2007-03-08 10:33:40

( Financial )



Federal direct student loan consolidation is a way for you to consolidate all eligible loans into a single loan and get a fixed interest rate for the entire life of the loan. Federal direct student loan consolidation program usually combines your federal student loans with your other eligible loans.

If you are going to take advantage of a student loan consolidation program, you have to act as soon as possible to lock in the lowest rates. You can consolidate your federal direct loans with other eligible loans. Other student loans can also be consolidated if you have an existing federal loan that has never been consolidated before. Direct student loan consolidation does not accept all kinds of loans. You may want to check with your local student assistance center or your lending institution to verify which loans are eligible for consolidation.

The interest rate on your direct student loan consolidation will depend on the current interest rates you have on your existing loans, the types of loans that you have and if you have gone through loan consolidation before. If you are confused, you should the help of your lending institution. They can help clarify the interest rate calculation.

If you have consolidation some of your loans in the past and you want to go through student loan consolidation again, you should first consider what your monthly payments will be. You should compare your monthly payments between the two options. If the monthly payments are almost the same, you should then consider the length of repayment period and the flexibility to allocate your monthly payments towards the loan with the higher interest rate.

If you want to view your loan history, most lenders offer an online service where you can view your account after registration. You can also get a copy from the local student loan data system available in your area.


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