Consolidate Private student loans

 

In a similar fashion to consumer debt, you can consolidate private student loans
if you have several loans from different lenders. This is especially important if one or more of your loans has a variable interest rate. By consolidating your student loans, you will be able to lock in a fixed rate for one amount. You will have just one lower payment each month making it easier to keep up with the payments. Also often there will be no origination or application fees and no prepayment penalty. In addition, some loans give you up to 30 years to pay. 

Federal and private student loans should not be consolidated together because if you do, you will lose certain benefits that come with federal student loans. Benefits like payment deferment will be lost if you combine your federal student loans with private student loans for consolidation.  There are programs that consolidate federal loans. You just should not combine the consolidation with private loans.

To consolidate private student loans often times can be harder than government loans.  Unlike government loans, you will have to have a good credit score.  An unfavorable credit score may require you to obtain a co-signer with decent credit.  Even if you do have good credit a credit worthy co-signer may reduce your interest rate.  Of course with all co-signer situations, the co-signer is also liable for the debt.  Also, some lenders are picky as to which creditors they will consolidate loans for.  You really need to check with the lender to see what their requirements are.

If you plan to consolidate your private student loans, you can reduce your monthly student loan payments by a significant amount and have just one monthly payment at a lower interest rate.