Consolidating a private loan with a federal loan

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Be sure to explore all your options and weigh which benefits – those provided by your original loans or those you could access with direct consolidation – will help you the most.Private loans are not eligible for Direct Consolidation Loans.Before you choose to consolidate your loans, examine your situation carefully to determine if this is the best course of action.This isn’t a solution that works well for everyone (even if you do have several different loans to manage).You may benefit by creating an easier-to-manage financial situation, getting better terms, or securing lower monthly payments.One big benefit of private student loan consolidation is the ability to refinance and potentially secure a much lower interest rate.

Access to those repayment plans is one of the benefits of Direct Consolidation Loans for some borrowers.Although the Perkins Loan program came to an end in September, 2017, old Perkins Loans are still eligible for consolidation, as well.If you have a PLUS loan in the name of a parent, that loan cannot be transferred to the student during consolidation.It’s best to reach out to individual lenders and ask for their specific rules around eligibility; compare the results to one another to determine what might be a good fit for you.Both the benefits and drawbacks of consolidating your private student loans are similar to consolidating federal loans.

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