Pro and cons of consolidating a student loan
If any of the student loans that you are consolidating have an outstanding interest then that interest will become a part of your new consolidation loan.This means that you will be paying interest on a higher principal than your original loan amount.So, this article not only offers you an insight of the pros and cons but also guides you with all of the various aspects that you need to take care of before you apply for Student Loan Consolidation.It’s better to start by understanding the basic meaning and then moving ahead.If you get your student loan consolidated for a longer term then it means that you will have to pay the interest amount for a longer duration.So, consolidating your student loan might end up increasing your payment amount.All of the Variable, as well as Fixed interest rates, get converted into a single Fixed Interest Rate after consolidation.So, what you pay next month or next year will be the same as the current payment, giving you no shock in the future.
In such cases, deciding to consolidate student loans could help you manage your debt more efficiently.
It’s common to have a mix of Federal and Private Loan after school.
You can easily have multiple loan services, due dates and minimum payments.
To know more about the Best Banks for Consolidating Student Loans in 2019, please visit this article.
To put it simply: Student Loan Consolidation is One Loan, One Lender, One Payment.
Here are some of the reasons to make you think otherwise and not opt for Student Loan Consolidation.