Are you carrying credit card debt with sky-high interest rates — in addition to your student loans? But think carefully before you use a personal loan to pay off credit cards.
As with all things in life, however, there are pros and cons to taking out yet another loan. (We’ll explain why below.) While there could be great benefits to taking on a personal loan to pay off credit cards, you will want to weigh those benefits against any drawbacks before making your decision.
There’s no “right” or “wrong” answer — you’ll want to consider all the facts, then judge for yourself.
The biggest advantage of federal student loan consolidation is that your monthly cash flow improves immediately.
My monthly payment went from almost $600 a month to $202 a month.
That means that you have various loans, and all of them have a 10-year repayment schedule. I got a lower rate and a lower payment, since my total repayment term had been extended to 25 years.
My monthly payments, all added together, ended up being right around 0 a month. Consolidation has worked well for me, and it can work well for many students, as long as you understand the risks.You may end up paying more in total interest after you consolidate your student loan debts.You could lose some of the benefits from your subsidized student loans.Loans that can be consolidated include direct subsidized and unsubsidized loans, subsidized and unsubsidized Stafford loans, direct PLUS loans, SLS loans, Federal Perkins loans and Health Education Assistance loans, among others.Private education loans are not eligible for consolidation.Commercial vehicles, salvage titled vehicles, and certain others are not acceptable collateral for secured loans. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors.