But after researching and reviewing the opportunities available, I started to understand more about the various options and also more about who specifically can benefit.Importantly, I learned that student loan consolidation can be a great option for some.When you consolidate your student loan debt you essentially combine multiple student loans (usually with various interest rates) into one new loan with a single interest rate.
As a holder of student loan debt myself, my interest is always piqued when I see an opportunity to ease the burden of student loan debt.
That being said, I’ll be the first to admit that I was a bit skeptical when I first heard about student loan consolidation.
My reaction upon first learning about student loan consolidation roller coastered from, Needless to say, I covered the gamut of emotion.
After years of hearing about the unforgiving nature of student loan debt (no bankruptcy, fewer options for forgiveness, etc), an opportunity to lower monthly payments (and potentially lower interest rates) seemed almost too good to be true.
Federal student loans are usually consolidated through the federal government and the interest rate is calculated by using weighted average of all the federal loans being consolidated.
Private student loans (and occasionally federal student loans) are consolidated by private lenders and the new interest rate offered will be dependent on your credit score. Check your rate using Ready For Zero's free debt consolidation tool.
People have saved thousands by consolidating higher-interest debts using a single, personal loan, this will not negatively impact your credit.
Check Your Rate Now Cons to student loan debt consolidation include…
Loss of protections When you consolidate your student loan debt, you may lose some benefits attached to your original federal loan.