Taking out a student loan consolidation loan seems to be more and more common these days. Students of all ages are finding themselves racked with debt from multiple financial aid lenders, whether private or government held. Interest rates on federally backed education loans have always been relatively low when you compare them to the majority of auto loans, mortgages and credit cards. But with changes in the economy and a whopping $1.1 trillion in student loan debt, Congress is getting ready to make decisions that will affect 7 million of people trying to pay back what they borrowed while obtaining post-secondary degrees.
Subsidized Stafford Loans are those backed by the federal government jason spencer dallas texas. They have held a steadily low rate of 3.4 percent since 2007 thanks to a piece of legislation enacted by Congress. Unfortunately, the time has come for those rates to expire. After a year long extension when rates were set to expire in 2012, Congress is faced with the daunting task of choosing whether or not to double student loan interest rates as of July 1, 2013. Without another extension, rates will go from 3.4 percent to 6.8 percent on loans for the new school year. Where will graduates, and their parents who are shouldered with paying back these debts, find student loan relief?
Student loan debt consolidation companies are seeking to provide graduates a way to get their loans under control. By combining multiple loans, borrowers can get a lower interest rate overall while lowering their monthly payment. Consolidation applies only to federally funded loans, not those serviced by the private sector. Working directly with the Department of Education, companies like NSLR shoulder the burden of collection and organizing paperwork and filing for one new consolidated loan that will offer the borrower with a 10 -30 year repayment term with a lower monthly payment benefit. Public Service Loan Forgiveness and Teacher Loan Forgiveness programs are also available to those who qualify.
With the looming possibility of interest rates going up and student loan balances becoming even bigger, borrower’s need to get creative and realize their options for tackling their debt. A student loan consolidation loan can offer a variety of benefits for borrowers including:
*One Low Monthly Payment
*Deferment and Forbearance Time Renewed
*Teacher Loan Forgiveness Programs ( Public Service Loan Forgiveness)
*Change Repayment Plans Routinely*
*Income Based Repayment Plans
Congress will soon enough decide whether or not they will let interest rates on government-backed loans double. This would apply to new loans, not those that have already been taken out. Anyone applying for a Stafford loan for the upcoming school year will most likely want to think twice about the fact that the interest they pay overall will most likely go up anywhere from $540 more on a $3,500 loan.
While those who already have loans out may find solace in the fact that their interest rates won’t double in their case, high balances and lack of a means to pay them off are still at the heart of the issue. A Student loan consolidation loan may be the answer for those who need options.