Consolidate College Loans
Any seeking to consolidate college loans may find that doing so will be both financially and administratively advantageous. Whether looking into the consolidation of federal financing or of funds provided by a private source, pulling a number of debts together under a single umbrella may decrease monthly payments and simplify the bill paying process. Federal financing generally comes under the heading of the Federal Family Education Loan Program, or FFELP, or the Federal Direct Student Loan Program, or FDLP. Both of these programs have lending options that allow students to pull together a number of separate debts that they may have accumulated during college years into a single loan. Longer loan terms can also go a long way to reduce the monthly payment. Attractive options such as fixed interest rates are also features that these lending options have in their favor. While obtaining a loan that extends from anywhere between ten and thirty years can certainly lower payments, the amount of my that will eventually be expended to retire the debt will, of course, be higher than with shorter term debt. There are many options to choose from, and a wise borrower will do careful research before moving forward to consolidate college loans.
Some of the different types of debt that can be consolidated by federal lending programs are the William D Stafford, the PLUS, and the Direct Stafford loan. When choosing to consolidate college loans, these lending options are generally processed through the Direct Loan Servicing Center. Students who are interested in checking out financing options can seek information through of these federal organizations. Free information packets as well as online information are generally readily available. Among the many benefits of choosing to consolidate college loans is obviously the financial reprieve that is available through lowered monthly payments. Other benefits might include a reduction in interest rates and an improvement in a borrower's personal credit rating. This improved credit rating is due to the fact that credit ratings can rise each time a loan is paid in full. The higher scores, coupled with the fact that monthly payments have been greatly decreased, can go a long way in improving the financial picture of the average consumer. There are, of course, some requirements for these lending opportunities. No loan that is in default can be part of a consolidation program. In addition, any debt that totals less than ten thousand dollars is not eligible for consolidation. A borrower must also be a graduate, or, if the borrower is still enrolled in school, must be only a part time student.
Often it is the parent rather than the student who is paying off a graduate's education debt. There are also federal programs that are available that allow these parents to consolidate college loans. of these programs is called the Federal Parent Plus program. As long as the parent's credit is high enough to qualify, they can take advantage of the same kinds of terms, interest rates and benefits that are offered to students who are attempting to consolidate college loans, along with some additional benefits. A variety of educational expenses can be covered by this funding including my that was spent to cover books, supplies, lab costs, room and board, and travel expenses. A credit rating of 625 or higher is generally required for this financing. However, no collateral is required for this financing and in some cases the interest that is paid may be tax deductible. The choice to bring all debt under loan can be a cost saving choice for both parents and students alike. The Bible talks about the benefits of trusting God. "As for God, his way is perfect: the word of the Lord is tried: he is a buckler to all those that trust in him." (Psalm 18:30)
Another source of funding can be found in the private student loan. Debt that has been accumulated through private lending sources can be consolidated as well. Most lenders who offer private financing also offer funding to cover all educational expenses. Once a student has graduated, any private loans that have g toward undergraduate or graduate degrees can be combined to consolidate college loans. Some lenders set a limit of not more than two hundred and fifty thousand dollars of total accumulated debt. For some of these financing options, a borrower will need to obtain a qualified co-signer. Unlike federally insured loans, obtaining a private loan is dependant on the borrower's credit. A healthy credit score that is based on timely debt pay off is needed before any kind of private loan consolidation can be achieved. As with any kind of borrowing, the higher the potential borrower's credit score, the better the terms and interest rates that will be available.
A combination of federal and private loans can not be included in debt consolidation loan. To consolidate college loans, private debt can only be combined with other private debt. In the same way, federal loans can only be combined with additional federal debt. In the case of federal debt, the interest rate on the new loans will be based on an average of all the loans that are being combined. The only exception to this would be if all of the debt that is involved in the consolidation happens to have the same interest rate. There are many web sites that include information on how to combine educational debt into loan. Whether choosing to consolidate federal or private debt, pulling all of this debt into loan can be very beneficial for students who are struggling to handle monthly payments.
Consolidate Payday LoansWhether or not to consolidate payday loans is a question many people may have on their minds, especially if there are more than a few of these screaming high interest loans that are behind schedule in being paid back. Payday loan agreements are a very bad idea for those who need money to tie them over until the next pay check arrives. It's understandable that sudden emergencies do crop up all the time, whether it is a furnace motor, a well pump, new brakes for the car, a medical co pay or some other pressing issue. Since it is estimated that seventy percent of Americans actually live pay check to paycheck, the possibility of having any real savings to cover these pop up crises is negligible. Now some people have outside resources from which to borrow money such as parents, other relatives and perhaps even a few churches, but most people are probably surrounded by those who are in the same no dough boat. So there may be no other place for a father to go when the radiator starts leaking on the car and it needs a one hundred and fifty dollar repair and pay day is a week and a half away. The car is the only way to get to work so there is no choice but go down to the local predatory lending company known as a pay check advance store.
Once this cycle begins, the difficulty to break out of it begins in earnest. More everyday emergencies arise as they always do and it quickly becomes very difficult to extract one's self from the ever increasing black hole. As a result, the principle amounts of the paycheck advance lending agreements often never get repaid and then the expense skyrockets and the question of whether to consolidate payday loans becomes a real possibility. Paycheck advance companies have extraordinarily high interest rates. In many states across the country, an unpaid loan of this type, if not paid in a year will cost the borrower eleven hundred dollars! Can a person even imagine the stress and the anxiety caused by not being able to stop this freight train effect could have on a low income family trying to do the right thing but knowing they are just a victim?
So suppose this father, who has borrowed two hundred dollars to pay for the radiator must let the loan principle ride for several months. He has only been able to keep up with the costs of administering the loan, about thirty dollars each paycheck, but in three months time the loan is now at four hundred and fifty dollars. Sadly, his son has to have emergency surgery and out of pocket expenses are over a thousand dollars. He goes back to the payday lender for more money. The man gets five hundred dollars this time and then it must ride for several months also. Suddenly debt is over fifteen hundred dollars in just five months time and growing by the day. So to the stop the bleeding, the father decides that to consolidate payday loans is the best strategy. No one wants to be poor financially, but Jesus actually praised a certain kind of poverty when he declared, "Blessed are the poor in spirit, for theirs is the kingdom of heaven." (Matthew 5:3)
There is a very barbed wire that surrounds the decision to consolidate payday loans and that is the condition of the debtor. Since FICO scores are of no interest to payday lenders, it is not a stretch to say that those who use these predatory companies probably have very tattered credit scores. Many may be in the low five hundreds. They are not individuals who can go into a bank and get a home equity loan so they will have to get borrowed money at local loan companies or certain online lending companies that charge as much as thirty percent interest if they can even qualify for this high risk money. This becomes a very real conundrum for the people that are looking to consolidate payday loans are the ones who cannot in any shape or form afford either a high interest loan or another one being introduced into their monthly budget.
Credit counseling services might be a good alternative for those who are wishing to consolidate payday loans. But there is a gigantic cockroach in that ointment. These friendly, personal check into cash people won't offer any consolidate payday loans benefits to its customers. In other words, credit counseling services can often cut in half the interest on choking credit card accounts, but cannot offer the same services for those drowning from paycheck advance interest. So perhaps the only choice for a person wanting to escape such a toothy bear trap is to seek out a high interest unsecured loan.
However, before making such a drastic step to consolidate payday loans, the advice so many financial experts give is to seek out a wise person who is successful at running their own financial household or business. Listen to their advice closely and ask them to give ideas on different options. Perhaps out of that conversation can arise a new perspective that has never been considered before. The beginning of wisdom is the genuine admittance that one does not have all the answers and that giant blunders have been made. God is certainly longing to hear that admission from all of us.