The Decision to Consolidate Student Loans

Consolidating student loans can improve the bottom line

Get the facts lined up before you decide to consolidate

Consolidating student loans may be a helpful alternative for someone struggling to pay off multiple loans, particularly if some have high variable interest rates. Although college loans are considered to be good debt because they are financing a person's future, they can nonetheless be a burden to repay. Those who find themselves in deep student-loan debt after their educations are complete often find that consolidating student loans really helps with the bottom line.

The decision to consolidate student loans

There's no right or wrong answer when it comes to whether or not you should consolidate student loans, but there are many factors to consider. The only answer that applies universally is that whether you should consolidate depends on your individual circumstances at the time, including type of loans you have and their interest rates. For instance, as of 1996, PLUS and Stafford loans have featured a fixed interest rate. For students with loans prior to 1996, however, the interest rates were variable. This means that the rates on these loans may continue to fluctuate each year. People with a variable rate often consolidate their loans in order to obtain a lower fixed rate.

Getting the best rate when consolidating student loans

Variable interest rates for student loans are established on July 1 of each year. Depending on current interest rates, a person planning to consolidate may want to wait until July 1 to do so, especially if interest rates have been falling. ... click here to read the rest of the article titled "The Decision to Consolidate Student Loans"