Student Loan Repayment: When is Consolidation a Good Idea

Once you leave college and enter the real world, it's time to start focusing on a student loan repayment program. Student loan debt, credit card debt, car payments and mortgage payments, however, add up quickly, meaning you might find yourself swimming in debt that the income from the job you landed fresh out of college simply can't cover. If you find yourself in that situation, it might be time to consider some serious student loan repayment help such as consolidating your student loans.

There are a number of issues to consider when deciding if consolidating your student loan repayment programs is a good idea. While consolidation means you can pay one lender each month as opposed to two or three, you will also repay the loan over a much longer period of time. There are, however, a number of benefits that might make consolidation a good idea for you.

Primarily, it's much easier to manage your finances if you are making fewer payments each month. If you find yourself struggling to make payments due to the sheer number you have, this alone makes student loan consolidation right for you. In addition, you will also likely be able to lock in a much lower interest rate than your original loan. That difference, however, may be cancelled out by the longer repayment schedule. Another important factor to consider is that consolidation may allow you to postpone repayment, allowing you to get your financial legs under you before you begin student loan repayment in earnest. Finally, as with any loan consolidation, you may be able to take out a little more money in the loan and apply the money to paying off other creditors. You will likely not find a lower interest rate or more favorable repayment terms than a student loan repayment consolidation loan. As such, if you can use the money borrowed there to pay off other higher interest creditors, it makes sound financial sense to do so.

Student loan consolidation may not be for everyone. However if you are drowning in the sheer number of payments, have a high interest rate, wouldn't mind postponing repayment for a while and have other high interest creditors you could use help with, student loan repayment consolidation may be a good idea for you.

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