You’re through with your college education, and now it’s time to repay those loans which greatly helped you finance your education. It’s advisable to use student loan consolidation companies because while you’re repaying them, you’ll also be in a position to save a considerable amount of money in your monthly budget. However, with an array of programs out there how do you identify the best student loan consolidation companies? How do you choose the company that fits your needs the best?
Potential risks may arise when you consolidate student loans?
What Loan Consolidation is All About?
Consolidation loan for students (private and federal) is a relatively new approach and is quite useful for graduates having multiple loans to refinance. In many cases, the interest on the student loan can be extremely high for some borrowers.
There are several private student loan consolidation companies on the market which can help if you’re stuck paying that high interest rate on your federal or private student loan debt. The private lender combines all your loans so that you can refinance them at lower interest rate.
Some of the Best Student Loan Consolidation Companies
These days, the market is awash with private student loan consolidation companies. Since student loan consolidation is a relatively new concept, the lenders you’ll come across aren’t your traditional banks, and you’ll probably come across very uncommon names.
Some of the best companies you can rely on are CommonBond, SoFi, U-fi, DRB, and LendKey. Each of these companies has its unique way of doing things, and it’s a good idea to compare all of them before choosing a particular one.
A Variety of Repayment Options
Statistically, SoFi is the leading student loan consolidation company with more than $3 billion in student loans refinance. So, it’s a good starting point especially if you don’t know which one to pick from the ones mentioned above.
The lender has an array of options available such as fixed rates, variable rates, mixed rates, short-term repayment period, long-term repayment period, etc. The good thing about the majority of these lenders is that they don’t charge any fees for consolidation.
What are the Benefits Associated with Consolidating Student Loans?
If you chose income-based repayment option, you’re allowed to refinance your federal student loan using your income meaning; you can regulate the amount you need to pay every month. Public Service Loan Forgiveness is a perfect example of such benefits. Like traditional banks, student loan consolidation has its fair amount of risks. By consolidating your student loans with a private student loan lender, all your student loan benefits will be washed down the drain.