Consolidating debt tips
For instance, you might be able to get a much lower interest rate and shorten your repayment term.
Because the interest rate is a weighted average, rounded up, consolidation is unlikely to save you money.Under these plans, the government extends your repayment term and caps your payments at a percentage of your income.That can help give you more breathing room in your budget.Debt, Direct Loan Consolidation, Featured, Federal Student Loan Refinancing, Private Student Loan Consolidation, Private Student Loan Refinancing, Student Loan Consolidation, Student Loan Consolidation Advice If you’re feeling overwhelmed by your student loans, you can take comfort in the fact that you’re not alone: Over 44 million Americans have student loan debt today.You might have a mix of both federal and private loans and have several different loan servicers.You’ll get a new loan equal to the combined amount of your old loans.
It will have a fixed interest rate based on a weighted average of the loans you consolidate.
If you want the stability of a fixed-rate loan with steady payments, consolidating can help.
Switching to a fixed-rate loan may give you a slightly higher interest rate, but it will remain the same for the duration of your loan.
Plus, refinancing is only available through private lenders, so you lose the federal benefits associated with any federal loans you refinance.
The new, refinanced loan can have completely different terms, too.
Use our calculator to see if refinancing can save you money. That means your interest charges could increase over time. If you’re on a tight budget and your loan payments eat up a big chunk of your salary, refinancing can help.