When considering student loan consolidation you have the option of either private or federal direct loans.

Private Loan Consolidation

Private loans are good if the college does not accept federal funding. It is also useful when federal funding will not cover all your outstanding loans. Private loan consolidations services are offered through banks and the terms are very similar to car loans and mortgages. Private loan consolidation has the advantage over federal loan consolidation in that it will typically cover the full amount of all your loans.

Federal Loan Consolidation Services

Federal direct loan consolidation made available from the U.S government is an option for American students and even to qualified non Americans who studied at U.S. colleges. This option for student loan consolidation is available to current students, recent graduates and those who are about to embark on new careers. It will not take your credit score into consideration and is easier to secure than private loans.

There four types of federal student loan consolidation. They are:

Standard School Loan Consolidation
With standard loan consolidation the payment terms extend to a maximum of 10 years with a fixed amount to be paid every month. Students who can afford to pay a fixed monthly payment should choose standard loans. The interest rate is almost negligible especially if the consolidation amount is high.

Extended Payment Plan
Much like the standard student loan consolidation the extended payment plan demands a fixed monthly payment that is extended over a longer period, usually 15 to 30 years. The length of time given for repayment all depends on the size of the loan.

Graduated Payment Plan
Students who are still enrolled in college who can only afford to begin payments after graduation should choose the graduated payment plan. With a repayment period of 15 to 30 years the monthly payments typically starts of low and increases every 2 years. In an ideal world the graduate will see an increase in salary over time and should be able to accommodate the increasing monthly payments as time passes.

Income Contingent Repayment Plan
The Income Contingent Repayment (ICR) plan makes it easier for students who pursue lower paying jobs to repay their loans. The monthly payments are based on the present income, size of family and the total amount of the loan. The payments are reviewed and adjusted annually based on changes in the borrower’s annual income and family obligations.

Visit our homepage at www.schoolloanconsolidation.net

Weigh the Risks and Benefits

Student loan consolidation can save you hundreds of dollars a month. Paying only one bill each month saves time and eliminates the possibility of accruing late fees because you were confused about which loan payment was due when. With consolidation it will always be clear when your payment is due, how much the payment is and what you interest rate you’re paying. And with a fixed interest rate you need never worry about fluctuations in the market increasing your monthly payment.

On the downside, loan consolidation can extend payments for as long as 30 years. The long repayment period means a low monthly bill, but overall interest rates could add a significant amount to your total. Make sure you understand the terms of the loan and are prepared to abide by them.

Find a Reputable Consolidation Program

There are many companies that offer student loan consolidation. Banks and other private lenders are available to consolidate private loans. Visit the Federal Student Aid website to consolidate federal loans. Perkins loans, HEAL loans, Federal FFELP loans and Federal Stafford loans, Guaranteed Student loans, and some others are all eligible for consolidation under the FSA program.

Gather Your Documents

Before filling out an application for student loan consolidation, take a moment to get organized and gather your necessary documents. You may need:

* Your FAFSA pin number
* Account statements
* Loan records
* Monthly bill statements
* Proof of income

File the Application

Carefully read any documents that are included with the application packet. You may be asked to select a repayment plan in order to complete the application. If so, use a loan repayment calculator, available at the FSA site, to help decide which plan is best for you. Complete and file your application online or by mail.

Federal Direct loans are supported by the government and offer lower interest rates and some flexibility when it comes to loan repayment. Since federal student loans don’t require payment until after a degree is earned, they allow the focus to remain on school. Most students are able to qualify for a federal student loan but must go through the process of filing a Free Application for Federal Student Aid (FAFSA) first.

Private Loans

A private student loan is also an option for funding a college education but doesn’t provide the flexibility that comes with a federal loan. A banking institute or credit union serves as the lender in this case and will base your loan qualification and amount upon a credit check. Variable interest rates are attached to your private loan and are dependent upon current interest rates.

School Consolidation Loans

Loan consolidation can help the borrower reduce monthly debt payment by combining more than one student loan into a consolidation loan. Although this can prolong the repayment process, it reduces the amount of money paid each month, which can help the borrower remain current with payments. Consolidation loans come in both Federal and Private consolidation forms.

Utilizing a school loan to fund college education can be a wise investment into the future. Like any other investment, it’s important to plan carefully to ensure the intended goal– obtaining a college education — can be met, without incurring debt that cannot be repaid in the future.

Private student loans can act as an alternative or a supplement to federal school loans. Either parents or students may apply for school loans through a private lending institution. Private loans have varying interest rates that depend on an applicant’s credit score and whether or not he or she has a co-signer for the loan.

Unlike federal direct loans that have fixed interest rates, many private loans have variable interest rates. Some students may secure interest rates that are lower than fixed federal rates, although variable rates are subject to increase in the future. Applying for a private school loan is less complicated than federal student loans, in that applicants do not have to complete the FAFSA, nor do they have to wait out lengthy processing times. Although it is preferable that students and parents secure funding for school plenty of time before tuition becomes due, applicants may apply for private school loans at any time.

Following college, students are often left with multiple student loans requiring more than one student loan payment every month. By combining those loans into a consolidation loan, students can make a single monthly payment and may be able to lower the amount of their monthly payment obligations. Federal direct consolidation loans are available through the U.S. Department of Education, and private consolidation loans are available through banks and lending institutions as well.

• www.loanconsolidation.ed.gov/ – Direct consolidation loans from the Government: Federal consolidation only.
• www.feded.net – student loan consolidation articles
• http://online.wsj.com/article/SB10001424052970204644504576653043088346786.html – WSJ article on new Obama student loan plan.
• http://www.consolidation.nelnet.net/ – starting place to start consolidating,

• School Loan Consolidation Home
• Private school loan consolidation
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• School Loans Blog

There is some word of advice that you should consider when it comes to federal loans and private student loans. Your federal loans are a higher priority in terms of payment versus your other loans. You have to consider federal loan consolidation before you get into private school loan consolidation. There are a few basic reasons for this. Through debt consolidation, you will be able to stretch payment for your federal loans for up to thirty years. Debt consolidation of your federal loans will also give you lower interest rates. You will be able to enjoy a few dollars off if you do this. One more thing that you should keep in mind with federal loans is that consolidating them is tax deductible. If you want to get into the more juicy details of such loan consolidation then you have to ask advice from experts in the field of finance. You might want to get in touch with a personal banker or a financial adviser. These experts will be able to give you solid advice in the field of consolidation. In fact, if you are lucky, you might be able to get in touch with a loan officer that specializes in loan consolidation at your bank.  You can ask advice regarding how to manage your federal loan consolidation and how to manage your personal loans. You will get a lot of information and you will learn a lot of techniques in managing the payment of your debt. Paying for student debt should not be a terror to face. You have to be ready and you have to be armed with the right information to address these issues. Your financial advisers will be able to do just that when you talk to them. Student consolidation loans are all over the place. If you want to take advantage of a more manageable financial future then you have to take active steps right now. You have to at least ask around about debt consolidation or loan consolidation.