Pros and cons of consolidating federal loans
This page will present a quick overview of each of the repayment plans, including which loans are eligible for them, what the monthly payment and time frame is like, and a summary analysis of the plan pros and cons.Here are the 7 available student loan repayment programs currently on offer: Your student loan is almost guaranteed to begin on the standard repayment plan, as this is the traditional repayment option.When I talk to people who are frustrated with their student loan debt and want to get rid of it as soon as possible, there’s one question that comes up over and over again: Should I consolidate my student loans?It’s a tricky question both because there are a lot of variables to consider and because there’s a lot of misinformation out there about exactly what student loan consolidation is and how it can help you.This plan is great for people who don’t have trouble making monthly payments, but it’s not so good for those of us who are living paycheck to paycheck, relying on credit cards to pay the bills, and consistently having trouble meeting our financial obligations.This plan is excellent if you’re having serious trouble meeting your monthly repayments either because you don’t earn enough money, or because you’ve got a huge student loan debt.
There are a lot of private consolidation products available. Here, for easy understanding: the pros and cons no one talks about when it comes to consolidating your student loans.
While it can be a great option to simplify and lower your monthly payments, there are other important factors to take into consideration. If consolidating isn’t right for you, there are other ways to manage your debt to get you to the celebration stage.
Your college degree might not always feel like it is worth the investment.
With respect to student loans, consolidation specifically refers to the Federal Direct Consolidation Loan program, which essentially allows you to turn one or more federal student loans into a different kind of federal student loan.
The main reason you would consider consolidation is it may give you access to the best federal student loan repayment plans. On the other hand, refinancing means taking out a new to replace one or more federal or private student loans.
If you’ve begun to feel overwhelmed by the pressure of student loans, fear not! Thousands of student loans are taken out every year, and many students are feeling the heat in the same way you are.