Higher education loan consolidation (Caveat Emptor)
When you are looking to consolidate your higher education loans you will be solicited by a number of lenders. Some of the deals you are offered will sound too good to be true, and they are. There are a lot of faux-consolidators that are looking to make a fast buck off of an unsuspecting borrower by adding fees and stipulations to their loans.
You do not want to get caught up in their schemes because it can do more damage than just ruin your credit. In some cases, it can cost you your home and even more money. It is very important that you be well informed when making the decision about which lender to borrow from and what deals to accept. Higher education loan consolidation is supposed to be about saving money by benefiting from a low interest rate, not putting you at risk of further debt and trouble.
Making the Choice
Choosing higher education loan consolidation is an important step in your financial future and should not be taken without much thought. You need not rush into signing any part of the contract without reading and understanding all aspects. Feel free to ask the loan agent plenty of questions before you sign. Most loan rates change yearly, on a specific date (like July 1st according to the T-Bill) so you can take your time and make the right decision.
You may even want to talk to your current lender about consolidation options with their organization. It is possible that, already being affiliated with their service, you can benefit from interest reductions and avoid origination fees. Even if you do not know the name of your lender it is possible to get that information through American Student Assistance and find out if they do consolidate.
Variety
There are a number of different types of higher education loans available to students. Of course, this means there are also a variety of higher education loan consolidation options. You will want to separate you loan types for different forms of consolidation. The two main types of education loans are federal and private. It is relatively easy to consolidate your federal student loans (Perkins, Stafford, Ford, Nursing, etc) and there are many organizations capable of consolidating them all. Federal loan consolidation comes with many benefits which are available with nearly every lender.
Private loan consolidation generally comes with a required credit check, even if you have a cosigner. These types of consolidation loans can vary with the lender and require a greater amount of window shopping than federal loans. That said, you can get a really great deal if you look for one, and it can save you thousands of dollars and loads of headache.
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