It is pretty pathetic how well they really educate the students on what they can do with their loans in order to pay them off or at least protect their credit during the process. Since I once worked for Sallie Mae for about 2 weeks I was able to get the inside scoop for all the different options. This was long enough for me to be trained on the options to use on the phone when calling those with defaulted or soon to be defaulted student loans. Here are your student loan consolidation options and more.
First, before we get into consolidation you need to understand what you can do to protect your credit if you cannot pay on your loans or cannot afford the entire payment. You have a few different options in this circumstance and the first is called a deferment. You can use up to 2 years of deferment and you can break it up into 6 month increments if necessary. This will protect your credit and give you time to get your finances in order before you start paying on your loans again.
Another option is forbearance and this can be used in 6 month increments as well. This is used for financial hardship and times of unemployment. Along with these two options you can always negotiate a smaller payment to continue paying on your loans without having to pay the full amount or ruining your credit. These are all things to consider instead of defaulting on your loans.
Second, when it comes to your student loan consolidation options you need to make sure that the option you choose will give you the full deferment and forbearance options. They many not be willing to negotiate on the payment, but most will and this would be a nice option to have as well. You should make sure that win any of the student loan consolidation options you choose you also get to deal with one well known company and you need to make sure they are not going to sell your loan to someone else.
Last, you also want to get a payment that fits your current budget to make life easier on yourself. This should also have an interest rate comparable to what you already have. When you consolidate you will no longer have to manage multiple payments and instead you will have one payment, at one interest rate, with one company to deal with. This makes life much easier for you financially.
By: Chad Wistick
Posts Tagged ‘Finances’
Student Loan Consolidation Options – What You Probably Do Not Know About Your Loans!
May 16th, 2010Consolidating Private Student Loans and The Rest of Your Options Post Graduation!
December 8th, 2009
If you are inching closer to graduation, then you have already begun to get marketing materials about consolidating private student loans. This is because when you graduate you have 6 months before you have to start paying on your loans. This is one of the options you can use to make it easier to manage your payments. Here are the other options you have.
1. Deferment
There are two type of deferment. One is just deferment and the other is educational deferment. The first is a period of time that your loans will accrue interest, but you will have no payments due. This will help you if you need more time to get your finances in order to pay on your loans. You can use this for up to 2 years after your first 6 months after graduation.
The other deferment is used for going back to school. As long as you are attending college classes part time you do not have to pay on your loans. They will still accrue interest if they are the type that do, but you will not have to pay until 6 months after you stop going to classes.
2. Consolidating private student loans
When you graduate you will have the option of consolidating private student loans and all your other loans. Most of the time you can do this to make them into one loan with one payment and one interest rate. This will make it much easier for you to deal with the loan and you will only have one monthly payment instead of a dozen or so. This is a smart option if you plan to begin paying on your loans.
3. Forbearance
If you have begun to pay on your loans and you run into some difficult financial times, then you can use what is called a forbearance to pause your loan payments for 6 months at a time to help you get through the difficult time before you have to pay on them again. This is for periods of unemployment or medical emergency.
By: Chad Wistick