News Room

Tuesday, July 3, 2007

Federal Loan Consolidation - Your Friend In Need

Federal loan consolidation is all about providing loans to students in need of finance. These student debt consolidation loans come as a fresh lease of life to students who are already reeling under the impact of student loans taken earlier. These loans have a longer repayment date and are provided at a much lower rate of interest. You can take advantage of these loans in many ways. Students with bad credit or no credit can apply for federal loan consolidation. Your application does not go through a credit card check. You do not have to give any guarantee of income. Best of all, you do not have to pay any fees.

The Benefits Of Federal Loan Consolidation

The greatest advantage of federal loan consolidation is that it has the guarantee of the government. Private student loan consolidation companies try to entice borrowers by offering loans at a reduced rate of interest. Usually, the students get a package, in which they get a reduction in interest rates, a longer duration of payment and a lower monthly installment. During the term of the loan even if you miss an installment due to a financial crunch, you do not have to lose sleep over it as you can always apply for extension. You can also offer a date on which it will be possible for you to pay. Because of the ensuing benefits, federal loans are extremely helpful for student debt consolidation.

When you opt for federal loan consolidation, you should tread very carefully and choose your lender very carefully. You get only one chance to take a federal loan. Make sure that the lender is at a reachable distance and one with whom you can interact freely. Also, see that the lender gives you proper respect and consideration. A federal program helps you to save thousands of dollars in terms of interest. Besides, you have a longer tenure and lower fixed installment to pay. However, this program may be available for only a short term, so do not lose time and apply for a federal loan consolidation immediately.

Some More Benefits

Moreover, this is not all; students who pay on time get rewards and incentives from the government. You also improve your credit-rating if you a pay on time. With a federal loan consolidation program, you can save up to 60%on your monthly payment besides getting tenure as long as 30 years if the amount of loan is bigger than $10000. For all purposes, student loan consolidation companies are more than eager to provide loans under a federal loan consolidation program. This is a new loan for the student and he no longer needs to worry about the previous loan installments.

Federal loans are available for a big section of student loans and other loans. HPSL, NSL, FISL, ALAS, SLS, NDSL, HEAL, PLUS and LDS. The US government supports federal loans consolidation under certain conditions. You should try to repay your loan according to the terms and conditions; otherwise, the government pays the lending companies, and extracts the same from the borrower, which can be very inconvenient for the borrower.



Technorati tags:
Posted by at 3 comments:
Labels:

Sunday, May 20, 2007

Federal Loan Consolidation for Medical Students

by Matthew Kelly

By the time you graduate you will most likely have at least $200,000.00 in student loan debt. After interest is added you could be paying a total of over $500,000.00, so it is extremely important to make sure you are getting the best deal possible with your loan consolidation. You will probably have both federal and private loans but for this article we will be dealing with only your federal loans.

Loan forgiveness -

The first thing to look into is if you will be eligible for any loan forgiveness, you don't want to lose your eligibility by not knowing what is required. In general you have to practice in a facility that serves low income people for a number of years but the conditions do vary by state. Check with your state's department of education for the specific rules. http://www.ed.gov/about/contacts/state/index.html With Stafford loans it doesn't matter if you've consolidated the loans or not, they can be forgiven either way. With Perkins loans you lose any chance of forgiveness if you consolidate them so you should check into it before deciding to add them to a consolidation. The National Health Service Corps offers loan forgiveness programs for physicians who agree to serve a certain number of years in areas that lack adequate medical care. Many hospitals and private care facilities offer loan repayment as an employment incentive for medical personnel.

Deferral and forbearance -

When you graduate and go into your residency or fellowship your loans will be switched to repayment status and you will have to make payment arrangements. Since most students in residency or fellowships do not make that much money they want put off making their payments. All federal loans come with the benefit of three years of forbearance and three years of deferral. In deferral the government pays the interest on the subsidized portion of your loans, in forbearance you are responsible for all of the interest. You must qualify for deferral, some fellowships qualify but since residency is considered employment the only option there is if you can show an economic hardship. In general your loan payments must exceed 20% of your disposable income to qualify for economic hardship. One of the benefits to consolidation is your deferral and forbearance time is renewed. This can be important to a medical student looking at a long residency, in that case you would want to wait to consolidate until you have used all of your deferral time so you can have three more years of it. It is important to remember that you are gathering interest during this time on all but the subsidized portion of any loans in deferral, the costs can really add up. Most lenders will allow you to make payments as you can during deferral and forbearance, if you think you will be able to offset your costs by paying anything during this time make sure your lender will accept payments when you are considering a consolidation company.

Capitalizing interest -

When choosing a consolidation company ask how often they capitalize interest during your deferral or forbearance period. A company that capitalizes quarterly will cost you more in the long run than a company that capitalizes yearly.

A student loan consolidation can save you thousands of dollars in interest but you must choose your company wisely. Ask questions before you decide who to consolidate with. Know how much you will be paying in total.

About the Author

Federal Education Services is a company that specializes in federal student loan consolidation, Stafford loan origination, PLUS and Graduate PLUS loan origination and as a resource for students with questions regarding educational financing. For any questions regarding this article please contact Federal Education Services. A friendly loan specialist can be reached at (877) 222-4727 or you can find us on the web at www.feded.net.



Technorati tags:
Posted by at No comments:
Labels:

Tuesday, May 15, 2007

Federal Family Education Loan Consolidation Helps Students Save

The Federal Family Education Loan Program (FFELP) helps students and their families save money by bundling multiple student loans into a single student loan, locking in the new student loan at a low interest rate and offering benefits in the form of interest rate reductions. H.R. 5, a bill recently passed by the House of Representatives and now being debated in the senate, will have a negative impact on Federal Consolidation Loans if it is approved by the senate and becomes law.

This legislation doubles the fees paid by FFELP lenders to provide federal student loans, which may eliminate the incentive benefits offered by FFELP lenders. It also encourages colleges to participate in the Direct Lending Program, which does not offer many interest rate reduction benefits to students when they do a student loan consolidation on their student loans.

Loss of Benefits Costs Students

According to NextStudent, the Phoenix-based premier education funding company, over the past three years, 4,653,000 students consolidated their federal student loans through FFELP lenders. As result of the interest rate reductions offered by FFELP lenders, such as NextStudent, a borrower who consolidated $30,000 last year could save $3,513 more than a borrower who consolidated with the Direct Lending Program. Additionally, a medical student could save more than $47,512 over the life of his or her student loans by consolidating with FFELP. These would be the savings lost if the current legislation becomes law.

Student Loan Consolidation Locks In Interest Rates

Other packages include the Google Package: a discount of .25 percent for Auto-Debit, a .375 percent discount after six months of on-time payments and a 1 percent discount after 36 on-time payments (not locked). The 2% Package features a discount of .25 percent for Auto-Debit and a 2 percent discount after 36 on-time payments (not locked).

Qualify over the phone in as little as five minutes. NextStudent’s personally assigned Education Finance Advisors will walk you through the student loan consolidation process from start to finish.

NextStudent believes that getting an education is the best investment you can make, and it is dedicated to helping you pursue your education dreams by making college funding simple. Learn more about Student Loans and Student Loan Consolidation at NextStudent.com.

Federal student loan consolidation is free of charge and can lower monthly payments by up to 60 percent. Also, there are no prepayment penalties. NextStudent offers some of the most aggressive benefits in the industry including a discount of .25 percent for Auto-Debit and a 1 percent LOCKED interest rate reduction after the first 36 on-time payments. These benefits can save borrowers thousands of dollars over the life of their consolidated student loan.



Technorati tags:

IceRocket tags:
Posted by at No comments:
Subscribe to: Posts (Atom)