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Feb-18th-2015

Student Loan Consolidation: Research Other Debt Relief Options First

750538246_7d1b3dbfcd_zWe often hear talk about refinancing loans, but when it comes to federal student loan consolidation, there are many more benefits enjoy. Refinancing is making payments more affordable. Consolidating places two or more loans into one. The monthly payments are lower, interest rates are lower and the budget relief it brings is immense. The affordability usually overrides the fact that a person who refinances or consolidates pays more in the long run.

When it comes to student loans most debtors have more than one and are trying to find an easier and more affordable way to manage the cost. The fewer bills the budget has to manage, the easier the task of not only affording it but also getting the payment out on time. Before you focus on student loan consolidation plans, you will want to make sure that you check your federal loans for other possible benefits. Once loans go into consolidation, the extra benefits are almost always erased.

Consolidating federal student loans takes careful consideration. Depending on the type(s) of loans you have out you may qualify for forgiveness programs or one of the many income-based repayment plans.

*In order to qualify for forgiveness, you would need to be working in public service at an eligible employer. For those who do, they can potentially have thousands of dollars wiped off their total balance. Forgiveness opportunities are erased once the loan has been consolidated, and default loans must be current before they may be accepted into the program.

*Income-based repayment plans bring affordability to those who are eligible. Monthly payments are lowered according to income and family size (savings varies by state) and the payment is recalculated each year. As your income goes up, so does your payment.

One thing you should never do is to combine your federal loans in with those from the private sector. The Department of Education will never service private loans, but a private lender will include federal loans. Once you turn these loans into a private loan, you have completely erased any federal benefit.

In some cases, consolidating student loan debt will not only combine your loans into one but the payment will also qualify for certain income-based repayment plans. When it comes to federal loans it is important to not settle for just one option. Most people miss out on multiple benefits because of the complexities involved with sorting through federal loan opportunities.

Federal loan debt services are a great way to get the most out of federal loan benefits. The expert loan officers have been thoroughly trained to match each loan with eligible payment plans. With certain loans, one plan must be processed before the next. Details such as this are often over-looked when a non-professional is processing the loans for debt relief. Take advantage of free consultations in order to shop for the best service provider. These programs should not cost thousands of dollars and a monthly management fee is unnecessary. Professional companies that offer a cost effective one-time fee with a guarantee brings more than peace of mind. You will find more than just student loan consolidation planning with a great company.

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