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Take inventory of your student loans.
For information on your student loans, review your loan documents, and
contact your lender or loan servicer. If you are uncertain of your
current lenders or loan servicers, you can find them by going to www.nslds.ed.gov.
Monthly
Payment Amount
If you are not in repayment status yet, estimate your monthly non-consolidated
loan payment based on the current interest rate and your loan balance.
You can get payment amounts by calling your lender or loan servicer.
Next Steps
- Determine whether your monthly payment
exceeds the percentage of your income to be allocated to student
loan payment. This percentage should
be based on a realistic budget. If payment exceeds monthly allocation,
reevaluate budget
and assess income situation.
- Consider deferment or forbearance option
for short-term payment relief needs. If debt relief needs are long
term, consider consolidation.
- Select loans for consolidation.
- Determine monthly payment and total
interest costs for Consolidation Loan and compare to cost of repaying
loans without consolidation. For help in calculating monthly payments,
contact Government Loan Services at 1-888-788-4335 or
simply apply online.
- Consider the impact of consolidation
on future deferment options, cancellation options, and other borrower
benefits such as interest
rate discounts
or principal rebates, which can significantly
reduce the cost of repaying your loans.
You might lose some discharge (cancellation) benefits or deferment
benefits if
you include certain types of loans in your Consolidation Loan — Federal
Perkins Loans, for example. To find out more about the impact
consolidating might have on deferment and cancellation benefits,
contact the
holder of your loan.
- If you decide consolidation is right for
you, click here to begin the application
process.
- If still in the grace period, consider consolidating approximately
two months before the end of the grace period to allow enough
time to have your Consolidation
Loan processed before the grace period expires, yet not so
early that you lose too much of your grace period if you
have a FFEL
Consolidation Loan. (For FFEL
Consolidation Loans, if you consolidate during the grace
period, you
give up whatever portion of your grace period remains. You
retain all of your grace
period, however, if you have a Direct Consolidation Loan.)
Some FFEL lenders offer to hold disbursement of Consolidation
Loans
until the
end of the grace
period to enable borrowers to minimize their interest rate
and maximize their grace period.
- Remember that if you consolidate
during your grace period, you can lock in an interest rate at least
a half percent
lower than
the current
repayment rate.
- When filling out the consolidation application,
provide complete address information, include two references, and
sign the
promissory note.
- If already in repayment, make sure to
continue making payments on your loans until consolidation is completed.
If you need immediate payment relief, request deferment or forbearance.
- If you have questions about consolidation, do not hesitate to contact
Government Loan Services at 1-888-788-4335.
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