Student Loan Consolidation

Posted by Judy Anne Cavey on Sep 19, 2011 in , , | No Comments

There’s only one type loan to consolidate–a student loan–and now is the time to do so.

One money management expert and best-selling author, Dave Ramsey, believes students would be wise to obtain all the facts before attempting to consolidate students loans. In his Q & A with American Profile, Mr. Ramsey discussed how student loans are different than other kinds of loans and credit, therefore, are good candidates for consolidation. Here are his rules if this sounds like something you want to do:

1.) You are allowed one chance for student loan consolidation, so do it when interest rates are low–right now.

2.) Get a fixed rate consolidation, do not get a variable rate as the interest rate goes up as rates do.

3.) Get a lower rate than your aggregate of your overall rate. For example: if you have a small student loan at 9%, and several big loans at 4%, the aggregate may be higher if you accept a 5% loan on the consolidation–the total may be higher. Make sure your overall rate is less, across the board, with all of your loans.

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