Federal Debt Consolidation Loans For Students

For American students, the U.S. Government came up with a plan
that can help a student manage their student loan debt. The plan
they came up with is called a Federal Direct Consolidation Loan.
It does not matter if you are a recent graduate student, well
into your career already, still at school, or in your grace
period for repayment of a student loan. For any of those student
categories, a Federal debt consolidation loan may be applied for.

Students successful in their application for a federal debt
consolidation loan may reduce the amount they need to repay each
month, or increase the time that they have to pay off their
current debt.

How Does a Federal Debt Consolidation Loan Help a Student Pay
Off Their Debt?

For a student who has student loans under several different
programs, bringing them all together under one direct Federal
Debt Consolidation Loan can make your debts easier to manage. By
combining all of your loans into one, you’re only responsible
for making one payment to one lender – the U.S. Government. To
help make the option of debt consolidation more attractive,
there are four flexible payment plans available, including two
that which take income and/or income expectations into account.

The Federal Debt Consolidation Loan is Available to Help you
Manage your Student Debt.

Student loan debt is not something that you want dragging at
your feet like a ball and chain. It provides a good opportunity
for students to learn to manage their finances. Even if you are
still at school, it is a good time to learn to manage your debt.
That will hold you in good stead as a consumer long into the
future. For example, if you choose to consolidate all your
student debts into one before you leave school, you can lock in
an interest rate that as much as .6% lower than if you attempt
to refinance later, after you have left and are no longer a

For more how a Federal Direct Consolidation Loan can help lower
your repayments, and manage your student debt, you can visit the
Department of Education’s web site. Once there, you can make use
of their online debt calculator at https://loanconsolidation.e
d.gov to estimate your projected monthly payment under the
various plans.

Can a Federal Direct Consolidation Loan help you manage your

There could be reasons why debt consolidation is not the best
solution for any particular student. If a student is close to
the end of their repayment term, for example, it may not be
worth the work to consolidate. Prolonging the life of your loan
is likely to increase the amount you pay overall. If you can
afford the higher monthly payments to pay off the debt sooner,
you can ultimately save money by doing so.

If, however, you are sure that a Federal Direct Consolidation
Loan will be to your benefit, you still need to be eligible for
the program. The eligibility guidelines can be found at
loanconsolidation.ed.gove/borrower/beligible.html In addition,
the list of loans that are eligible for consolidation can be
viewed at: loanconsolidation.ed.gov.borrower/bloans.html

Which Federal Student Loan Consolidation Plan is the most
suitable for you?

Here are the 4 consolidation loan consolidation plans that are
available to choose from:

Standard: The standard repayment plan is fixed-rate, and runs
for a maximum of 10 years. The minimum monthly payment is $50.

Extended Repayment Plan: this is a fixed rate plan, with
payments extending over the course of 12-30 years. Payments are
a minimum of $50, and the life of the loan is dependent on the
total amount of the debt.

Graduated Repayment Plan: Under the graduated plan, payments
start low and increase, generally every two years. The length of
the repayment period can vary from 12 right up to 30 years.

Income Contingent Repayment Plan: The monthly payment is based
on a borrower’s annual adjusted gross income, family size and
the total amount of direct loans.

If your student loan debt is out of control, or could be better
managed, it is worth paying a visit to: https://loanconsolidation.e
d.gov to see how the federal government can help you with a
debt consolidation loan for students

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