Advice for consoladating school loans
Instead of making multiple payments to multiple lenders, the borrower only has to pay off the new consolidation loan, says Michelle Pezzulli, vice president of operations for Credit Union Student Choice, a student lending service provider in Washington, D.
C."That new loan will have its own interest rate; it will have its own repayment terms; it will have its own terms and conditions," she says.
Consolidation provides grads with the ability to combine their student loans into one megaloan, but it comes with drawbacks.
Along with gaining a new degree, many graduates will also leave campus with new student loan payments they'll have to fit into their post-graduate budgets.
A consolidation loan is just what it sounds like: You can take two or more outstanding loans and refinance them into one.
That’s what our Student Loan Smarts series is all about—helping you understand all of your options so you can make decisions that fit with your financial goals. Choosing to consolidate or refinance student loans.
For example, under the Public Service Loan Forgiveness Program (PSLFP), your Direct Loan balance may be eligible for forgiveness after 120 payments if you’ve worked in the public sector that entire time.