Many students graduate from college and have two or three different student loans that they have to start repaying. The amount of money that you pay out each month can take a significant chunk out of your salary each month. With student loan consolidation, you can roll all the student loans into one and have one monthly payment that takes care of them all. The payment is often lower than the combined total of the separate loans.
The Federal Student Loan Consolidation program allows you to manage the debt much better. It bundles all the various loans with different interest rates into one single fixed-rate loan where the interest rate can be as low as 2.75%. When you lock in the rate at this low level, you know the amount of your payment each month for the term of the loan and this makes it much easier to budget. Graduating from college not only brings you the repayment process of your student loan, but when you start a new job you also have to have a car and pay rent for your own apartment. When you consolidate the loans, it makes it much easier to have the other things you need.
It is very easy to apply for student loan consolidation. If you have several loans with different lenders, contact each one to see which lender has the lowest interest rate. You can also contact other lenders to have them take over all the loans. If you do the consolidation within the grace period provided just after you leave college, you can cut the monthly payment by about 60%. However, this also means that you will have to start making the payments sooner. You can also save money by electing to have the payments come directly out of your back account.
When you consolidate your student loans with lower interest rates, it also means you can have them paid off sooner. There is no application fee and the chances of getting the approval for the consolidation are quite high if you have a job. There is also the added benefit that you can pay as much extra as you wish each month without being penalized for early payment.