A student should always, once through college, initiate steps to consolidate their student loans. This article details the benefits available to graduates, parents or students who take those steps.

The Consolidation of Student Loans Brings Reduced Payments

When a student gets all his or her loans under the same Social Security number, then the government will agree to consolidate those student loans. The student’s individual loans are paid off, giving the student one large loan.

Moreover, when the government takes steps to consolidate student loans, it also takes two other important steps: It extends the loan and it lowers the loan rate.

There is not set way by which a loan provider can bring down the rate on a consolidated loan. A reputable loan provider carefully examines all the possible ways that a student’s rate might be made lower.

The loan provider then establishes that low rate as the rate for a consolidated and extended loan.

The government’s willingness to both extend the loan and to lower the rate can save students considerable money. Although the payment schedule has been extended, the person with the consolidated loan can feel free to pay the loan off ahead of schedule.

In other words, there is no prepayment penalty levied on those who make an early pay-off after choosing to consolidate student loans.

Two More Reasons to Consolidate Student Loans

It was mentioned above that the rate on a consolidated loan is lower than the rate on each of the original loans. Besides being lower, that rate is also fixed. The rate on a Stafford or Perkins Loan is variable.

The rate on a consolidated loan does not change during the course of the loan.

A student with a consolidated loan does not need to spend time keeping track of the payment schedule for two, three or more loans. That student loan recipient can just make a single monthly payment.

Often the student elects to make that single payment through an automatic debit. That can decrease the loan rate by another 0.25%.

Still Other Reasons to Consolidate Student Loans

Gradate students who consolidate student loans can learn then about fellowships and graduate school loans. Parents who consolidate their loans can search for free money or private loans. Those benefits come on top of the loan’s lower interest rate.

When you consolidate student loans, you provide yourself with a chance to improve your credit score. No graduate wants to face credit problems that have been caused by his or her need to take out loans in order to cover college expenses.

In light of all the above benefits, students should ask this question:

Who Can Qualify for the Program to Consolidate Student Loans?

Before allowing a student to consolidate student loans, the government looks to see if the student or graduate owes $10,500 or more.

The government also checks to see if the loan recipient has any loans in default.

By: Martin Haworth

The settlement loan frequently asked questions contains the 7 most popular answers to questions regarding settlement loans. It’s common to have questions when taking out this type of loan. Below, you’ll find all the answers to the basic questions that can arise.

What is a Settlement Loan?

A settlement loan is a cash advance on your pending lawsuit. A settlement loan provider will give you a loan contingent on your pending case; based on the amount that you might win and the merit the case holds in court. These are great for people who cannot work during their pending lawsuit and need cash to support themselves financially.

How do I pay back a Settlement Loan?

You loan is paid back after you case is settled. You will not make monthly payments or have a lien placed on any property you might own. The whole concept of the settlement loan is to provide an advance on possible winnings awarded in your lawsuit case.

What if I lose my pending lawsuit?

With most respectable settlement loan providers you pay nothing back. The agreement is that you only pay back the loan if your case is won. If you win less money then what was provided in your loan you keep the difference.

Can’t my attorney just lend me money during my case?

The American Bar Association won’t allow attorneys to lend money to clients. This prevents conflict of interest during your pending lawsuit. In theory, if you owed your attorney money you might feel the need to settle for a less amount to satisfy that loan.

What can I use the Settlement Loan for?

Whatever you want, the settlement loan will not contain restrictions on what the money can be spent on. However, settlement loan providers like to know their clients are using the money to support themselves during their pending lawsuit financially.

How long does it take to receive my funds?

This can vary from settlement loan providers; it can take longer if you go through a broker and not an actual settlement loan provider. It can take around 2 to 7 days in most instances to get your loan approved and receive your funds.

What will my attorney think of getting a settlement loan?

Your attorney should understand with your interest in a settlement loan. They especially know the hardship on some clients during a pending lawsuit when they cannot get access to funds. As long as it doesn’t interfere with any current agreements with your attorney they should have no reason to be against the idea.

By: Legal Settlement Loans

You can be considered in default of your student loans after one or two missed payments. Even if you make partial payments your account can go into a default status. This is not a bill that you can ignore without serious repercussions. You may think that you are just racking up a few late fees, but you could not be more wrong.

You will be charged late fees, of course, but what you may not realize is that these late fees can amount to more than you originally borrowed. There is no cap on how high your late fees can go. Collection efforts also come with a charge. The Department of Education has to hire a collection agency to do their dirty work and you get charged for it.

Your interest rate can jump up astronomically every month that you do not pay. This can also quickly raise your balance to way more than you ever thought possible. The Department of Education has the power to get their money by any means possible. Therefore, this huge number on paper will eventually come out of your pocket.

The IRS can send any refunds due to you directly to the student loan manager. This is usually their first line of defense when it comes to getting their money. They usually go to the IRS after ninety days of no payments, so it does not take long. Instead of getting your refund, you may get a letter stating that it has been sent to your student loan lender instead. If this amount does not cover the amount that you owe, then the next step is taken.

Your wages can be garnished and the amount you owe will start coming out of your paycheck. This can be devastating for most families and if you thought you were having trouble paying your bills before, try having your paycheck taken.

If that is still not enough, then they can sue you for the money that you owe. If you receive any kind of federal benefits, then they can intercept those as well. The bottom line is that you can not get away with not paying your student loans off.

If you are in default, call your loan manager and figure out the best steps to take. There are options like deferment, forbearance, and loan cancellation. Sometimes bankruptcy can dismiss student loans, but not always. The best thing to do is to lay out all of your options and come up with a solution. Some loans have income based payments that are adjustable depending on how much money you make. There are options out there for you, but you do have to ask. Paying off your student loans can be within your reach if you try.

By: Evelyn A. Saunders