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Consolidation Loans – General

What is Consolidation?

A Federal Consolidation loan is a repayment option for student loan borrowers. It is designed to make education loan repayment easier by combining existing eligible federal education loans into one new loan with a fixed interest rate and a lower monthly payment. Consolidation is a bit of a misnomer because a single loan can be "consolidated" to take advantage of better loan terms.

Why should I consolidate my student loans?

Because you want to lock in your rate, lower your payment. But consolidation is not for everyone, especially private loan consolidation. ScholarPoint offers info, data research and resources in hopes your learn before you act.a complete and instant online student loan experience. You simply enter your informatio

Are there other costs associated with consolidation?

There are no fees of any kind associated with a Federal Consolidation loan. There are no closing costs, prepayment penalties, or credit checks.

Who should consolidate?

Faced with typically lower paying entry level positions immediately after graduation, former students have not yet had the time for their degrees to begin translating into strong earnings which is why it is the worst possible time for them to be faced with large monthly student loan payments. Refinancing the education loans can be the perfect answer for many faced with steep monthly student loan payments.

Refinancing can help simplify the financial situations of recent college graduates by cutting monthly education loan payments, sometimes by as much as 50%. This is achieved when borrowers take advantage of student loan consolidation opportunities. Actually student loan consolidation and refinancing student loans are synonymous concepts because the refinancing is accomplished through consolidation.

Typically, college loans are disbursed each term or year that a student is attending school. Thus, upon graduation students may have a number of separate loans, sometimes all at different student loan interest rates. They may all be federal student loans or a combination of federal student loans and private education loans. Student loan consolidation allows graduates to roll several education loans into one single student loan with one single monthly payment as opposed to multiple monthly payments on multiple college loans.

In addition to obtaining lower monthly payments, student loan consolidation can also often results in real savings when students can consolidate student loans bearing higher interest rates into a single loan at a lower interest rate. As a result they pay less in interest on the college loans over time.

Students and parents who have large federal education loan debt or high monthly payments consider a Federal Consolidation loan. Federal Consolidation loans are ideal for borrowers who have high monthly payments and prefer to lower them. Also, many borrowers that have several federal education loans with different lenders or different due dates, find consolidation an attractive option.

What are the benefits and advantages to consolidating?

Lower Monthly Payments: Most federal education loans have a maximum repayment period of ten years. A Consolidation loan allows you to extend the term up to 30 years, which may lower monthly payments by as much as 53%.

Interest Rate Cap Reduction: The maximum interest rate on a consolidation loan is 8.25%. This will help PLUS loan borrowers repaying at a higher rate.

One Convenient Payment: You only need to make one payment a month versus multiple payments with different due dates to different lenders.

One Fixed Interest Rate: A Consolidation loan is a fixed rate that will never increase.

No Penalty For Early Repayment: You may prepay your Consolidation loan at any time without penalty.

Four Repayment Plans: ScholarPoint offers a Graduated Payment Plan, a Level Payment Plan, an Income Sensitive Payment Plan, and an Extended Payment Plan depending on your needs.

Simple Loan Application Process: Applying for a Consolidation loan is hassle-free. There are no credit checks, application, origination or processing fees.