Consolidating federal and private student loans together
That’s far easier than making several payments and remembering different due dates.
Not only will you save time and frustration, you’ll be less likely to accidentally miss a payment and incur fees and/or a negative mark on your credit report.
You are eligible for federal loan consolidation if you have two or more federal student loans and have graduated from school or dropped below half-time status.
You may be eligible even if you are in default on one or more of your student loans, provided that you have agreed to a modified repayment plan.
If you would like to add other eligible loans, your servicer must receive your Request to Add Loans Form within 180 days from the date your Direct Consolidation Loan is completed (originated).
And sometimes, you might even be able to save money by refinancing your student loans at a lower interest rate.
Here’s a beginner’s guide to student loan consolidation and refinancing.
Sometimes it makes sense to consolidate or refinance, but many times it doesn’t. Student loan consolidation is a program that repackages all of your federal student loans into a single loan with one fixed interest rate and one payment.
If you have variable-rate student loans, there is always the chance that those rates could go down and the fixed rate you get with a consolidation loan will be higher than you would’ve paid.
Right now (2015), however, this isn’t much of a risk as interest rates are low to begin with and will conceivably only go up in the near future.