Are you in a fix about the deals of loan repayment? Well, it all but common to have students pursuing their under-graduation, graduation and post graduation programs breaking their back over the proposition of repayment. That’s because as a student in dire need for resources, you may have ended up availing several loan options, in excess of one. Under such a scheme of necessity, you ought to come to a constructive decision. It is all about pondering and brainstorming, so that a suitable solution can be worked out. That’s because it isn’t impossible to come up with a feasible solution. One of the effective alternatives gears to the deal of consolidation.
What exactly is consolidating student loan?
It is a fresh package of loan option, which you bank upon, with the sole purpose of debt clearance. But here again, the responsibility for repaying the package lies with you. Do remember that not all private loan packages have the option for consolidation. But similar is not true of federal loans. That’s because all federal loan types facilitate repayment by way of consolidation. It is not a compulsion, but it is one of the constructive options for you to bank upon.
Some of the conditions of eligibility
The aforementioned no credit check loans facility is meant for fulltime students. But school going students are not eligible to apply for loan consolidation. Secondly, the option for consolidation is extended, only for the self assigned packages; the loan packages which are jointly shared along with partner, parents or spouse are not open to consolidation. The option is extended to those who are still within the grace period of repayment. You ought to carry at least five to seven thousands in US Dollars in credit, and then only, you will be in with a sanction. The condition of the least minimum balance amount varies from lender to lender. The lowest limit is not applicable for packages which are directly sanctioned by the federal government. Do remember that private loans cannot be repaid with the federal option for consolidation. Under such a circumstance, you ought to approach private loaning facilities for the purpose of consolidation.
Some of the features of advantage
The solution comes as a constructive option for those who are in with multiple loan packages. In that way, you can streamline the process of repayment, clearing out several small deals in one single stroke. With this option in hand, you can expand the term of repayment. Moreover, it is always better to go in for a singular mode of repayment than looking for those which are variable. By means of the same, you will be subjected to a fixed percentile of interest payment. With an improvised score of credit, you can pick on loan consolidation with lower rates attached to them. Instead of having to bear the brunt of interest payment on a monthly basis, certain lifestyle conditions or changes brought therein may be more conducive to singular mode of repayment.
Demerits for you to consider
Do be watchful about adding to the length of your time period, as that will entail greater payment in terms of interest. This in turn may necessitate enhanced saving and cutting down on the cost of living. By opting for a plan of consolidation, you may lose out on the benefits extended by loaners in terms of rebates and cuts of discounts.
It is also important for you to remember, that once you enter into a deal on loan consolidation, it cannot be done away with. So, do consider the long as well as short term impacts of the same, before entering into a deal of transaction.