Consolidating private student loans through government
To successfully navigate this often confusing process, you need to understand the pros and cons of refinancing, what to expect from the process, and what programs are offered by top lenders in the industry. Federal student loans come in two types: Direct Subsidized Loans or Direct Unsubsidized Loans.Students with demonstrated financial need are often awarded Direct Subsidized Loans which do not change interest as long as you are in school or in a deferment period.Borrowers should look for lenders that do not assess prepayment penalties.Lenders who charge for their services should be scrutinized closely.Private student loans can also come in handy for unexpected educational costs that aren’t covered by a federal loan.When you graduate or leave school, your student loan will go into repayment and you will need to assess whether or not your loan is really the best deal out there.The best banks to refinance and consolidate student loans look at a borrower’s creditworthiness when determining whether or not to approve them for a new loan.
When trying to make a determination whether or not it makes sense to refinance or consolidate your student loans, it is important to have a clear understanding of what you want to achieve.
The best banks to refinance your student loan do not charge such fees.
Lenders do charge late fees or fees for insufficient funds, but clearly communicate those fees to borrowers in advance.
This will show up as an inquiry on a credit report which can impact a credit score.
Too many inquiries over a long period of time can lower a credit score, so you need to be certain you want to pursue refinancing and/or consolidating your student loan before completing the application process.