If you have multiple student loans and you are tired of making multiple monthly payments on each loan, then you may want to consider consolidating your student loan debt. Not only does consolidation eliminate your multiple payments, but it will also lower your total monthly payment in most cases. For those who are having difficulty repaying their loans, a consolidation can provide a more manageable repayment plan.
Consolidation Loan Details
A student loan consolidation will extend your repayment term so your monthly payments are lower, but you will most likely repay more over time in interest, even if you have a lower interest rate. Most people who use student loan consolidation will pay thousands of dollars more in interest, so keep that in mind as you consider your options.
Bank of American Options
The Bank of America has partnered with the Khan Academy to provide educational tools and resources related to student loan and debt consolidation in general. Although Bank of America does not offer consolidation loans specific to student loans, they do offer general debt consolidation loans.
Private Student Loans
If you have private student loans, you will be able to include those in a debt consolidation loan, but be sure to compare the interest rate of the consolidation loan to what you are currently being charged. If the consolidation loan has a higher interest rate, you may want to re-consider, because you will be paying more in interest over time, even if your monthly payments are lower.
Federal Student Loans
In most cases, you cannot include federal student loans in a debt consolidation loan. This is actually a good thing, because most federal student loans have low interest rates, and most debt consolidation loans have high interest rates. In addition, some federal loans do not have any interest charges, so you will want to carefully consider the advantages and disadvantages of consolidating your federal student loans. In some cases, you may want to be selective in the loans you choose to consolidate, although you will still be left with more than one monthly payment.
Whether you have federal or private student loans, or both, there are consolidation options available. Take some time to do some research to find the financial institution that has consolidation options that are the best fit for your specific situation. Don’t be afraid to contact a lender online or by phone if you have questions about their consolidation options.