Private student loan consolidation: How can you gain from it?

Description: If you have a number of outstanding private student loans, then private student loan consolidation can relieve your debt burden.

Student loan consolidation permits borrowers to make their budgets simpler. They can combine all their eligible student loans into one loan with a low interest rate and a reduced monthly payment.

There are federal student loans and private student loans. Borrowers who are trying to pay off their private student loans can do it through private student loan consolidation. It’s truly an outstanding option for individuals who have become overextended with their private student loan burden. Private student loan consolidation offered by various agencies has helped countless graduates, students and parents alleviate their debt burden and breathe a sigh of relief. Loans are available at competitive rates and terms.

Why private student consolidation loans have become so popular?

Private student consolidation loans have garnered significant popularity because of the following reasons:

You are allowed to postpone payments for up to one year 
Introductory rates with auto debit discount as little as 7.27%
Reduced payments without prepayment penalties
Availability of cosigner release options

Benefits provided by private student loan consolidation

Following are the important benefits offered by private student loan consolidation:

1) Reduced monthly payment

Consolidation of your student loans offers you flexible and stretched out repayment terms that would considerably reduce your monthly loan payments. Stretching out your repayment terms can offer you the flexibility in cash flow you require to gain control over your finances. As there are no prepayment penalties, you can always make more than the minimum payment each month.      

2) A single monthly payment

You don’t have to worry about paying your multiple creditors any more. All your loans are combined into one so that you have one convenient monthly payment.

3) Improved interest rates

You should make the most of the introductory interest rate. You can qualify for a rate as low as 7.5%. You can also get an extra 0.25% rate reduction if you choose to pay through electronic debit from your savings or checking account. This would result in lowering of your introductory interest rate to 7.25%.

4) Postponement of monthly payments

Forbearance for 12 months is available if you’re unable to make a payment because of financial difficulties or unavoidable circumstances.

5) Cosigner release option   

Many borrowers come with cosigners who are bound to their private student loan liability. When you’re consolidating your private student loans without a cosigner, the cosigner is released from the responsibility wholly. Now the loan is yours only.