College Loan Consolidation Programs: Preparation For Your Application
Graduates often find it difficult to take control of their debts, which explains the popularity of college loan consolidation programs. But properly preparing for the application process is vital to getting the best consolidation deal.
The financial pressure created by loans taken out while in college can be crippling by the time graduation day arrives,
when lenders expect the repayment schedule to kick in. But many graduates are not yet in a position to meet those repayments. Thankfully, through college loan consolidation programs, the pressure can be alleviated.There are several advantages to choosing this course of action. After all, managing college debt is not a simple thing when debts of as much as $50,000 have been amassed across several loans. With different balances, interest rates and repayments schedules, meeting loan repayments can cause a serious headache.However, with the benefits of consolidation, the challenge of clearing college loans is made a lot simpler. Obviously, qualifying for a consolidation program is essential, and to this end there are several factors to keep in mind.Know Your Financial StatusArguably, the most important factor is to know what your own financial status is. There is little point in applying for a college loan consolidation program if the extent of the debt to be consolidated, and the budget available for repayments, are not known. So, the first step is to assess the total existing debt and how much is available to repay them.Once this is done, managing college debt becomes a lot simpler. For example, if there are five loans outstanding, with a combined balance of $43,000, the different interest rates could see the repayments due figure as high as $700, depending on the term of the loans. By doubling the term, from 5 years to 10 years, a more affordable repayment of $350 can be secured.Negotiating the consolidation loan term is very important. The longer the lifetime of the loan, the lower that actual repayments - though it also means the interest paid will be much greater that on the original college loans.Check Your CriteriaOf course, it is also necessary to make sure all of the necessary criteria is met before beginning the application process. College loan consolidation programs are designed to help graduates who are either set to struggle or are already struggling to make their loan repayments. This means that not just anyone can get one.For a start, the applicant needs to prove they have received the right kind of funding, with confirmation of loan agreements with the lending authorities. It is also necessary to be 18 years or over, and a US citizen. Also, managing college debt through consolidation loans is really only effective when a large debt remains, so a minimum debt balance of $10,000 must exist.As well as these conditions, it is also necessary for the borrower to confirm a source of income. Once this is provided, then the process of clearing the college loans can begin.Details to CheckAnother key factor to watch out for is the reputation of the lender. The Internet is full of unscrupulous operators, so it is vital to make sure that any prospective lender is trustworthy. Use the Better Business Bureau website to confirm the reputation is good first.However, it is advisable to seek college loan consolidation program from a familiar lender - ideally a lender of the existing loans.Managing college debts through a consolidation program is definitely worth it, since the ability to repay the loans and regain credit ratings is made so such easier. It is important not to accept the first package offered and to be able to tell the difference between a good deal and okay one.Interest rates should be as low as possible, and usually a fixed rate is best as it ensures consistency in your budget. And, even if it takes 30 years, once the college loans are cleared, the weight off your shoulders will be apparent.