Student Loan Consolidation
by Kevin Ree
OK…pause and simplify the process with these empowering tips:
- Consolidation is combining loans to have one loan servicer AND one monthly payment. Start by knowing what types of student loans you have – are they federal or private? Have you asked them?
😝 - Federal and private education loans CANNOT be combined into a NEW FEDERAL LOAN (Direct Consolidation loan), BUT they CAN be combined into a NEW PRIVATE LOAN.
- No fees to consolidate federal loans when going through the U.S. Dept. of Education here: www.studentloans.gov (Beware of companies charging for a Direct Consolidation Loan).
- Private loan consolidation (AKA refinancing) usually involves fees, credit checks and being employed. The credit check helps determine the interest rate offered (nice score = nice rate).
You can’t un-consolidate a Direct Consolidation loan. And that matters why? 
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- If you’re going for Public Service Loan Forgiveness while working at a qualified employer AND have been making payments – CONSOLIDATION WILL RESET PAYMENTS. Yep, you’ll have to start the 120 payments over.
- Switching from a federal loan to a private loan reduces options for payment plans, deferments and forbearances. Before deciding, ask lenders what options they offer in case you ever need to lower or postpone payments (job loss, sickness, etc.).
See…so easy! Feeling great to be more empowered? 
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