Should I or Should I Not Join a Student Loan Consolidation Program?

Consolidating student loans by joining one of the many offered programs today, has become very popular among students through out the United States. However, a decent amount of due diligence has to be done prior joining a student loan consolidation program. Furthermore, it is important to understand that not every student loan should be consolidated with others as it will result in no financial benefit what so ever. In fact consolidating a Perkins Loan with other federal student loans will end up in paying more for ones initial student loan repayment plan.

Which type of loans should be consolidated?

Consolidating student loan debts is a good idea for any student looking to improve credit ratings or to ease the amount of monthly payments. If decided, consolidate all federal student loans such as PLUS and Stafford loans which have a non fixed rate and are relatively high. Therefore, a Perkins Loan should not be consolidated as it is known to be a low and fixed interest rate student loan.

You will be enjoying a fixed rate determined by the average of the student loans you wish to consolidate. Some student loan consolidation programs offer an incredible low and fixed rate of 4.5%. A good idea would be finding a few student loan payment calculators online which will give you better tools in order to compare rates from different lenders and eventually assist you in finding the ultimate program to fit your needs.

When the subject of consolidating private student loans is discussed, it is recommended that a student who has obtained private loans for student with bad credit ratings should consolidate his loans. This will result in improving his bad credit score and make payments easier with a benefit of an interest deduction in some cases. Do not consolidate federal student loans with private student loans because this act will result in loss.