Choosing a Consolidation Lender
Many companies offer loan consolidation, so it’s important to be an educated consumer when shopping for a consolidation lender.
- – Some lenders promise very low monthly payments, but your actual monthly payment may differ based on the underlying loans you consolidate. Get all the details before you commit to consolidation
- – Lenders may offer you perks, such as a small reduction in your interest rate, if you sign up for monthly electronic automatic payment. However, consolidation loans are frequently sold among lenders, so the terms of your agreement may change when your loan changes hands
- – If you’re unsure whether a consolidation lender is reputable, check with your school or the Department of Education
- – Consolidation is available both through private lenders and through the Direct Loan Program. Interest rates are the same both ways, but private lenders may sometimes offer incentives like interest rate discounts if you sign up for automatic payment plans
