Does consolidating student loans help credit score dating shushu ua

It is important to understand how your interest rate, repayment benefits, deferment/forbearance options and other factors differ between your current federal student loan(s) and a private consolidation loan.

Knowing the differences will help you to determine if consolidating your federal student loan(s) into a private consolidation loan is in your best interest.

This is particularly true for grad school borrowers who use unsubsidized Direct loans and Graduate PLUS loans to finance their education.offer benefits and protections that do not transfer to private lenders.This is often the reason that people cite when they say you shouldn’t combine federal and private loans.But before you dismiss the idea of refinancing, you should first take a look to see if any of these benefits apply to you.For example, under the Public Service Loan Forgiveness Program (PSLFP), your Direct Loan balance may be eligible for forgiveness after 120 payments if you’ve worked in the public sector that entire time.

Similarly, the Teacher Loan Forgiveness Program is available for teachers who work in schools that serve low-income families full-time for five consecutive years.

These are clearly great programs for people who choose careers in public service or education, but if that’s not you, they won’t do you any good.

There are also a number of federal loan repayment plans that can ease the burden for borrowers facing tough economic times.

For example, the government’s Pay As You Earn (PAYE) and Income-Based Repayment (IBR) programs allow borrowers to make reduced monthly payments based on financial hardship.

But if your income is over a certain threshold, you won’t benefit from these programs.

And if you do qualify, but you’re at the high end of the spectrum, your slightly lowered payments may come at a through the refinancing process won’t make sense for every borrower, but it provides great benefits for some.