Questions about consolidating student loans
Those perks include income based repayment plans and student loan forgiveness.Another advantage to the federal loan consolidation process is that anybody can do it. The downside is that consolidating your federal loans doesn’t actually lower your interest rate. Another downside is that you can’t pick the federal loan servicer that handles your new consolidated loan.
All loans are eligible for private loan consolidation, even federal.
Consolidation with a Private Lender – In order to consolidate with a private lender, a borrower must pass a credit check in order to get approved.
At that point the borrower provides the new lender specific loan information so that the old loans can be paid off.
In theory, only one lender is required to complete the process, but we normally recommend shopping around in order to get the lowest interest rate.
This adds a bit of extra time to the process, but can result in significant savings.