Paying back student loans?

Erica, Yes when you consolidate your loans your interest rate will be lower. Usually companies like Sallie Mae or Wachovia have great offers. Your payment should begin six months after graduation. I would advise that you consolidate your loans and that will make your interest rate and payment much lower. Have a great day!

Consolidation is a trick to get more of your money. Sure the payments may be lower, but instead of paying for 10 years, you pay for 30. Thus giving them more of your money. Not to mention if you consolidate federal loans like the Stafford, you loose all the benefits of federal loans in the first place like mandatory forgiveness and forbearance options. Things you won't get if you go to a private company like the ones mentioned. Don't do it.

Consolidation CAN be a good thing, but it isn't necessarily ALWAYS going to be a good thing. Interest rates, like so many other things, change according to what's going on in the economy. Some years they are higher than others, some lower. Also, in most instances the more money you borrow, the higher the total amount of the loan, the higher the interest rate may be because the lender has more to lose if you don't pay. Ultimately, that's what decides the interest rate; how much the lender feels he has to make in interest in order to compensate him for the risk he's taking that he may not get his money back. Consider doing this: pull out the documentation on ALL of your loans, and write down the balance for each, and the interest rate they want for that balance. Then, go looking for consolidation loans, and check out the interest rates they are asking for on them; if your old loans have lower interest rates (and some of them very well may!) there's no sense in trading them in for a newer loan with a higher rate! The best strategy then is to total up the outstanding amount on each loan with a higher rate, and only refinance those. Also, only look at loans that have FIXED interest rates. They may have a higher interest rate right NOW than the lower interest rates attached to loans called "Variable rate" loans, but their are two main advantages to fixed-rate loans. You will ALWAYS know what your payments will be on them for the life of the loan, and the interest rate will NEVER go up, unless perhaps they include a penalty clause that allows them to raise the rate if you prove to be a bad payer. (some of those may be very strict; learn them and pay close attention to them; you have to try really hard to NEVER make a late payment) Interest rates will also vary according to how long you want the loan to last, for the same kind of reason; the longer they lend you the money, the more chance there is something will go wrong for you and make it difficult for you to pay... so, they want more interest to help protect them from an eventual loss. So in closing then, look for fixed rate loans with interest rates that are LOWER than the interest rates on the loans you already have, and try to only refinance the loans where you can get a lower rate. There is one other reason some people consolidate; many times when you total up the minimum payments due on several smaller loans, the total dollar amount will be higher than the monthly payment would be on a consolidated loan. Unless you don't have enough money to PAY all of those smaller minimums combined, the strategy I spelled out earlier is still better; a smaller monthly payment is no real advantage if you're paying more interest over time, because ultimately you will end up giving them a lot more money.

be careful with the terms of the agreement with consolidation. Found-1 is correct, they will extend the time to pay back the loan, this will get them more money in interest but lower monthly payments for you. I had a very large amount of student loans which I consolidated from an 8% rate to a less than 4% rate several years ago. They changed it from a 10 yr loan to a 20 or 30 year loan. Fortunately, all it took was a simple phone call to change it to a 5 yr repayment period. And honestly, the monthly payment did not go up as much as you might think with the 5 yr plan Read the details very carefully if you decide to consolidate and discuss with someone knowledgeable in finances to be sure what you are doing is in your best interest

Hello how are you? As mentioned in other responses consolidation can be a tricky issue. In some cases consolidation is a good choice however in other cases it is a bad choice. You can learn more about the positive and negative affects of student loan consolidation at how-to-get-a-student-loan.com I hope this helps you. Good Luck!