Can I Consolidate My Student Loans?

A National Education Crisis

Today there is a new national crisis. The debt that is being racked up by students is astonishing. This debt is growing faster than at any time in United States history. Experts agree that it is expected that each college graduate will leave college with around $25,000 in unsecured loan debt. When you add to this the high unemployment rate among recent college graduates, you end up with a lot of bad student loan debt.
The total student loan debt is now running over $1 trillion. Part of this is the requirement of more people needing a college degree to get a living wage. Part of this is the rise in cost of tuition that has exceeded 1,120% over the last thirty years.
Since taking out student loans is the only way most of us can afford college, what can be done as we see the federal government hiking the interest rate? Luckily, student loans with bad credit can be consolidated today.

Defaulting on Loans

When a student defaults on a student loan, he finds himself in a bad credit spiral. Not only can she have trouble getting the student loans necessary to complete her education, but she may find that future employers will not talk with her because of her bad credit history.

Consolidating Student Loans

The student loan process can be helped through debt consolidation. This will not only help the students improve their credit score but it will allow them to obtain needed loans at lower interest rates.
The student has to surrender all the existing loans to a company that specializes in student loan consolidation. That company pays off the loans and issues a new loan that the student will have to pay off over time on a monthly basis.

Bad Credit

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The term bad credit when applied to students means the student is unable to repay his or her loans. By consolidating these loans, the student will earn a good credit rating and will find the loan repayment process to be much more manageable.

Expensive But Worth It

It is more expensive to consolidate student loans. This is because the credit rating of the student has fallen by missed or late payments. It is a good option, however. It helps the students by removing the crushing weight of bad loans and allows the students to focus on their education.

Federal Loans

The federal government offers several loan programs targeted at students. In most cases these programs are the best options available. The federal programs are not trying to earn a profit off of students. Some of these programs do not even look at the credit history of the student.

Cosigners

It is possible to obtain private loan consolidation. For this to work the student will require a cosigner. A cosigner is someone who steps in to make the loan payment if the student fails to. This person has to have excellent credit. The cosigner also has to have a steady job with enough income available to make the payments.
Unlike cosigning for other types of loans, student consolidation loans often will have an option that releases the cosigner after the student has made a certain number of payments on time. This allows a student to find a cosigner who is only willing to cosign for a year or two but does not want to be on the hook for decades.

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