How to Consolidate Your Student Loan Debt

College graduates, take some advice from a person who did not prepare adequately for student loan repayment and start packing away the funds now. You have a 6-month “grace period” with most of your loans, but then… time to pay up! If you end up in the position I did – not having the money to make the payments – look into consolidating your student loan debt. It’ll make it so much easier to handle it if you do. If you’re not sure about how to do it, go to my favorite website, Credit-yogi.com, and get some answers. This free website will guide you through the process of merging your loans, making it relatively effortless. Let me share some of the advice I got from the knowledgeable people who staff the site.

For consolidating federal student loans here’s one option. You can choose to go with the new Pay as You Earn plan, which is what I did. According to Credit-yogi.com, if your total loan debt is disproportionately high compared to your income, this is a good repayment plan for you. Most of your direct loans can be consolidated and repaid using Pay as You Earn; the exceptions are Direct Consolidations that paid off PLUS loans for parents. If this idea seems like a good one to you, here’s what you need to do. Print out an application from the StudentAid.gov website and choose the Income-Based Repayment (IBR) plan. Once the Direct Consolidation loan has been drafted, you’ll get information from your new loan servicer. Included in the materials from the loan servicer will be instructions about contacting it to determine your eligibility for this plan. 

Let’s talk about your private loan debt. It can’t be consolidated with your federal loans, but this doesn’t mean it can’t be consolidated at all. Consolidation forprivate student loans is best accomplished through a credit union. As Credit-yogi.com points out, conventional banks seldom opt to consolidate private student loans because they’d have to lower the interest rates on them, which is not fiscally feasible for banks. Credit unions, however, are noted for having lower rates in general than banks do, and are pleased to be able to offer private student loan debt consolidation at rates as low as 4.75%. Credit unions are doing this to attract younger members, and it seems to be working. Some of these fresh additions to credit unions may be able to save hundreds of dollars by consolidating their private education loans, so check it out.

The information I just communicated to you is only part of what Credit-yogi.com has available. There are other ways to eliminate student loan debt besides what I mentioned, so give the intelligent, helpful staff members a call at 866-964-9644 whenever it’s convenient for you. The site is operational 24/7, and someone is always there to assist you.