Private Student Loan Consolidation – Pros and Cons You Need To Know

The best way to reduce your monthly payments for all your student loans is to apply for a private student loan consolidation. Combining all these private loans will help you lessen your worries and stress of multiple obligations in payment numerous bills.It will help you manage your funds effectively because it will make the interest rate lower once you consolidate your loans. For instance, the interest rate of one of the loans you applied is 6.8% payable in 15 years but once you consolidate everything in one private loan, it will extend its terms to 25 years with the same rate of 6.8%.Below is a list of benefits of the private student loan consolidation:-Your monthly payments will be reduced. Getting a consolidation will help you extend the payment terms.-It will lessen the interest rates. Once you established a good credit line, most of the time you will be offered reduced interest rates.-You may be granted lower annual percentage of rate loans if you apply as an individual or with a co-signer who is credit worthy.-Postponement for 48 months for dental and medical residents, and 36 months for any military personnel who are active in the service.-For borrowers who are still undergraduates, they may be granted up to 25 years payment term and for those who already graduated they may be given up to 30 years payment term.-Should you make a payments in an amount greater than what is due, the extra money will go straight to paying down the principal.On the other hand, below is the list of things you should know before you apply for private student loan consolidation.-Usually, it will take 45 days for the entire process of private loan consolidation. Although, this is depending on the completeness of documents you submitted, such as expenses, income and information about all of your student loans.-Your school need not to be involved in your loan consolidation.-While you are still finalizing the process of the consolidation, you have to continue paying your monthly dues on time. This will show that you still have a good credit standing.-There’s a minimum amount that can be borrowed, which is a combination of all the student loans of around $5,000 or higher. On the other hand, there’s also a maximum amount that can be borrowed. Most of the time, the figure will depend on the lender’s policies. Contact your lender for detailed information and clarifications.