After the payment can really eat into any extra money you have left over each month after paying all your other living expenses. Of course, you are obliged to pay them back. But we also need to be able to afford the regular costs that allow you to keep a roof over your head, eat, buy gasoline and even pay for the occasional doctor's visit.
Most college grads and post-graduate study to carry $ 10,000 and loans, with many carrying more than one hundred thousand dollars in debt. And many of those loans are in fact many in their name. When a person has to multiple payments each month, this means that different payment amounts are due on different days - a confusing mess
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One solution that many grads with debt used to reduce your monthly payments: loan consolidation. It can also be thought of as refinancing your debt.
How to refinance student loans are different than refinancing a mortgage
, however, refinancing student loans is a little different than refinancing a mortgage. This is because, with student consolidation loans, you essentially are combining multiple loans into one loan. And you are able to spread their payments over a longer period of time -. Which reduces your monthly payment is
In the meantime, when you refinance a mortgage, usually just a refinancing of existing mortgages. And, in the case of mortgages, usually you exchange a 30-year mortgages for others. Thus, unlike the student loan refinancing, mortgage refinancing if the only way to reduce the payout is to find lower interest loans.
consolidation loan: refinance your student loan
This is why consolidation loans can be such a great way to reduce your payments. Depending on the type of loan you have - federal or private -. The interest rate for your new loan is calculated differently
For example, if you want to consolidate federal student loan debt consolidation of your interest rate is calculated as a weighted average (including the outstanding amount of principal and interest) of all existing loans, rounded to the nearest 0.125%.
On the other hand, if you need to consolidate private student loan debt, your new interest rate is calculated based on either prime rate or LIBOR, plus an additional number of points of interest largely determined by your current credit score.
In order to strengthen
If you currently have federal student loans, like Federal Perkins, treat, Stafford, PLUS, FFELP and Direct, you will need to fill out a request for federal student loan consolidation. You can find these applications at the U.S. Department of Education web site, or a quick Internet search.
to refinance and consolidate private loans, you should first contact at least 5 private student loan consolidation companies. Do your research on each company, using its web site and any other available materials. Your goal should be to see if they have any special programs going.
Once you have found 3 lenders that you like, fill out a request for all of them. You will want to make sure to receive offers from any of them. Only by comparing multiple bids can be sure you're getting the best possible interest rates.