Manage Student Loans
If student loan payments are draining your budget, consolidating or refinancing may help. If you have several federal student loans, consolidating them through the Department of Education’s Direct Consolidation Loan program won’t save you money over the life of the loan, but you will be able to pick a new repayment plan that better fits your budget.
Most borrowers are placed on a 10-year repayment plan and pay the same amount each month until the loan is paid off. Other plans stretch repayment over a longer period, gradually increase your monthly payment amount or base your monthly payment on your income.
Unlike the federal government, private lenders will refinance both private and federal student loans into one loan. Assuming you’ve established a good credit history, you’ll likely be able to score a lower interest rate on your private loan than you did in college—and borrowers with stellar credit profiles may snag a reduced rate for their federal loans, too.
Keep in mind, though, that if you refinance your federal loans with a private lender, you’ll typically lose valuable benefits.
