Once a grantee needs to start paying his student loans, it is advisable that he seek loan consolidation. Student loans usually have varying interest charges, but with consolidation, the grantee is commonly locked into a lower interest rate and installment amounts, and therefore a loan easier to pay.
The Process Of Consolidation
Loan consolidation is simply taking out the existing loans from lenders and pooling them into a single loan. Taking out means the consolidator pays each lender a balloon payment for the outstanding loan balance, thus assuming the loan risks. The consolidator then restructures the loan, resulting in lower repayment amounts, but usually a longer payment term. However, a consolidator may maintain or even lessen the rates, depending on the creditworthiness of the loan grantee. The terms vary on a case-to-case basis.
Types Of Government Student Consolidation Loans
Generally, two types of government student loan consolidation schemes. The first is direct consolidation loans. This is making payments directly to the US government Department of Education, bypassing any bank or secondary lending institution that may have lent you the...
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