Student loan consolidation makes it possible to combine your outstanding student loans into one, convenient loan.
There are two types of consolidation: private student loan consolidation and federal student loan consolidation.
You can read the full details for each below and learn how to consolidate your existing student loans.
Generally, you can combine private student loans from one or more private banks or lenders into one loan made by an existing lender or a lender that specializes in consolidating private loans.
However, you shouldn’t and in most cases can’t, consolidate federal student loans into a private consolidation loan.
Finding the right bank to refinance or consolidate your student loans is confusing.
For example, consolidation simply means combining multiple student loans into one loan, but you get different results by consolidating with the federal government vs. Student loan refinancing is when you apply for a loan under new terms and use that loan to pay off one or more existing student loans. When you consolidate with the government, your existing federal loans are combined into one new loan with a new rate, which is a weighted average of your old loans’ rates.Student loans have a way of making you feel powerless.But the truth is, you have more control than you think.That’s what our Student Loan Smarts series is all about—helping you understand all of your options so you can make decisions that fit with your financial goals. Choosing to consolidate or refinance student loans.