College Loan Consolidation

[KNORMAN]

I am about to consolidate mine and my husband's college loans (about $19,000). Does anyone know anything about consolidating and what companies have the best rates. We are looking at EdAmerica right now. We are also going back to school for our masters. Should we wait to consolidate? I would appreciate any advice!

[RJB1180]

Re: College Loan Consolidation

Are The Loans Federal Direct Loans Or Loans From A Private Bank?

Do Not Consolidate If You Have Federal Loans And Are Going Back To School Full Time, You Will Give Up Any Deferment/forebarance(sp?) Rights You Have.

Generally, Direct Loans Are Best Consolidated With The Goverment. Also, Most

Also, Most Lenders Have Told Me That It Is Better To Keep Your Loans Seperate From Your Husbands, In Case Of Disability, Divorce Etc.

[flash]

Re: College Loan Consolidation

Hubby and I both deferred our loans while we pursued our doctorates. Unless that rule has changed too, I would definitely defer.

Again, ancient experience, but once the loan comes due, the original lender often sells it off to another institution, like Wachovia. If you haven't yet received your payment info, you might need to wait for it to settle before you try to consolidate.

Anyone know if consolidating student loans takes them out of the protection of student loan status?

[debtfreeme]

Re: College Loan Consolidation

my federal loans are consolidated and i have forbearance and deferment rights. I am in school for 6 units each semester to save the interest i have to pay. i still pay the minimums even though i am not requred to because part of one still will accrue interest as it is unsubsized. I have been doing this for year, perfect excuse to take a class or two and enjoy a new subject and puts myloans into deferment. If the consolidator gives out loans they must use the fed gov guide lines and give you forbearance and deferment capabilities but read the paperwork carefully.

You need to check, not all consolidation programs are the same. I loved mine with VSAC, they were quick and easy and a god experience. Get the lowest rate you can.

Be careful consolidating your loans together. If something was to happen to you or your husband and they had passed on, you are still responsible for paying it all back. be very careful. Most people recommend just consolidating your individual ones, not together wven if you are married because you will end up losing money in the end.

[jodi]

Re: College Loan Consolidation

DH and I consolidated several years ago - but not together. We were told not to for the reasons listed above - that is something happened to one of us, we would then be responsible for both.
He has Sallie Mae Servicing, I have Nelnet - no problems or outstanding service from either, although I do remember Sallie Mae giving a credit in the past to DH for a perfect repayment record - no missed payments for so many months (I don't remember how many), but we had to start this all over when we consolidated - meaning those years of perfect payments might have added up to more credits if we hadn't, but at least this way we locked in a better rate (I also have a perfect record, but Nelnet has never rewarded this). DH's loans are now in deferment since he is back in school - we had no problem getting this. In fact, we didn't have to do anything to get it. The deferement automatically started when he took his new loans out.

[KNORMAN]

Re: College Loan Consolidation

My loans are through citibank and my husbands are through edAmerica. I know mine are federal, but I am not sure about EdAmerica. I may not start my Masters for a couple of years. My husband is beginning his in the fall. We have been paying on the loans for several months, now, and I want to look into consolidation before the interest rates hike. So I just need to check into a company that will allow deferment if we go back to school and consolidate them separately?

[debtfreeme]

Re: College Loan Consolidation

First you need to call your husband student loan company and find out if his loans are private or federal.

If they are private the company can make any rules they want concerning deferment and fore bearance (here in called D and F). Some of this is spelled out in his original promissory notes. Pull them out and READ them. Most sign without reading. He also should have gone through exit counseling when he went through repayment schedules.

If they are federal loans they have to use the federal guidelines concerning D and F. Ask them to see in writing their procedures concerning consolidation.

Lock in a promise that they use the national clearing house for college and universities that way you will not have to go and do paperwork each semester he is in school, they just use the download from the clearinghouse.

What ever you do, do not pay his fees for classes late as he will not be showing on the download that he is in school, you will get a letter saying he is not in school from the loan company and then you have to go through the paper process to get deferred and that can take several months during which you might have to make payments.

Be careful, you may have more than one lender to deal with even if you think all your loans are through one company. If they sell any, make sure you have ALL your loans to do at one time.

Questions to ask of your consolidators:

If you do consolidate your loans separately (please do this, god forbid someone dies or you divorce it just get to messy and you end up paying way to much.) ask them if they give credits back for xx months of repayment good history.

Ask if they take a % off when you consolidate all your loans with them so that you can save some money. (I saved more than 2k when I did this)

Do we get a % off if we use direct withdrawal through ACH? (if so use this service! It can save you hundreds in interest if not thousands. Set up a separate saving account they can access and make sure there is always several months of payments in there when you get into repayment.)

Can you make payments toward the principal owed while he is in school for his loans, and make sure the letter you send with each extra payment specifies PRINCIPAL repayment.

Are there any fees to consolidate?

How often can I consolidate? If you are both going to go back to school you want to know this because I can guarantee you will not have the same lender for both under and grad school.

Ask if they ever sell loans?

Will I lose the grace period on loans that have not gone into repayment? Can I add those in later?

Make sure you really want to do this before you do it. Makes sure you have a good interest rate, make sure that you can consolidate your loans from grad school into this one or to create a new one.

Ask them to give you different figures. IE if you have one loan that is at 8% and others are at 3-5 depending upon the weighted average and the amounts you have in different interest rates it might be better to not consolidate a higher interest rate one because if you do you end up paying more on the other little amounts in the long run. Perhaps you keep the large interest rate out and pay that off separately.

If you want to talk about this privately send me a PM with your phone number and I am happy to talk to you about it.

I take two classes a semester at a local college to avoid having to pay interest, get a great edu in something I know nothing about or perfect my foreign languages and have a great time. Look into this too. All together I pay about 100 per semester and save more than that. I still make payment but directly to principal only.

[debtfreeme]

Re: College Loan Consolidation

Also, if you can consolidate them with the company you took them with, do not use some outside agency, they can make any rules they want regardless of what kind of loans they are.

If you choose to go this route, check with the BBB and feds to see how they are regarded. Ask to speak to students who have consolidated with them and READ EVERYTHING you can about them. Dont just use a service that send you something in the mail. They got your info simply because they accessed your credit report and saw you have loans. Often they get brochures from some of the larger and more private schools on graduation day and just start checking. They make money and are there to make money, NOT to hlep you save money.

[abowers]

Re: College Loan Consolidation

I consolidated with Nelnet back in April. I locked in at a lovely 2.67 interest rate, I think that's gone up considerably by now. I had about $17,900 in loans when I did that. I'm satisfied with Nelnet (although the reason I'm with them is because HSBC sold my loans to them). Their customer service is good over the phone, and their website is easy to use. My loans are all federal stafford loans, subsidized.

You can consolidate and then go on to grad school, I am doing that. You can still defer (with Nelnet anyway) as long as you are above half-time status as a student.

I consolidated to lock in at that super low rate. It extended the term out to 15 years, but my payments are only $123/month right now, which I can afford as a preschool teacher. My reasoning is that after my master's I'll be making a lot more, and I can pay them off quicker than in 15 years if I want. But it made it more affordable to pay them now.

I'm also glad I did this because my grad loans will probably be at a much higher interest rate than my under grad by the time I'm done -- I'm not planning on grouping those together when Im done with my master's.

[KNORMAN]

Re: College Loan Consolidation

Thank you for all the help! I have a list of places I am going to check into, and now I have all the questions I need to ask them! If I need any more help, I may take you up on the offer to call "debtfreeme." I don't know much of the terminology when it comes to business and loans, etc. I took my loans with Citibank. They are a pretty big company. Does anyone have any opinions about them?

[KNORMAN]

Re: College Loan Consolidation

Well! It actually is better for me to go with my husband's loan company. They allow deferment during school, consolidation into current consolidated loans with new loans, discount for 36 months of timely pay, and a discount for automatic debit.

That's great for us! They also said the application comes with an agreement from them that they will never sell our loans to another company. I am just waiting on the application to read the fine print!

The interest rate is 3.75, I think. I will have to look at the paperwork again. The only downfall is that my husband's loans are not enough to consolidate alone. He has about $6,000 or so, and most companies want at least $10,000.00. Total though, our loans will only be around $25,000.00. That's great! And we can pay on the principal while he's in school.