Consolidating private student loans chase
ccording to the Project on Student Debt, the average debt for graduating college students is ,000 as of 2010.This marks a rise in the average debt compared to previous years. The Institute for College Access and Success found that student debt is growing at an average of 6% every year.The Federal Direct Consolidation Loan program, however, has no minimum balance for consolidation loans.The interest rate on a consolidation loan is the weighted average of the interest rates on the loans being consolidated, rounded up to the nearest 1/8 of a percent and capped at 8.25%.
If your school participates in Direct Lending, you should visit the US Department of Education’s Federal Direct Consolidation Loan website. I'm at Day 26 in your 31 day money challenge podcast. I've been looking for a comprehensive guide to all-things-money and this has been so informative." --Danielle Get Instant Access!
Also, most lenders require a minimum balance before they will consolidate your loans.
For example, many lenders will only offer consolidation loans for borrowers with loan balances of at least ,500.
Consolidation loans combine several student or parent loans into one big loan from a single lender, which is then used to pay off the balances on the other loans.
The theory is that either by stretching out repayment of the loans or refinancing them at lower interest rates (or both), the borrower can reduce monthly payments. It is important to note that Federal student loans cannot be consolidated with private loans.