Apart from federal school loan consolidation, you can also opt for private school loan consolidation. Private school loan consolidation provides a way to consolidate all private, non-federal educational borrowings. With a private consolidation loan, you can consolidate your student debt as well as education-related credit card debt.
In private school loan consolidation, parents can consolidate loans of more than 1 child; even spouses can consolidate their loans into one private consolidation loan. Parents can act as co-signers in order to help students get lower interest rate and save a lot of money in the end.
Benefits of Private School Loan Consolidation:
- Integrates all loans into one and reflects a positive payment history.
- Improves your credit score.
- Combines all debt used to pay for your education, including high rate credit cards.
- Private student loan consolidation helps you save more money each month, cutting down payments to as low as 50%.
- It saves you money by giving you a competitive interest rate as compared to non-government loans.
- Enables you to write fewer checks and may have a lower monthly payment.
Moreover, they can be used to consolidate all education-related debt, including all private loans used for education-related expenses.
Private school consolidation loans:
You can consolidate the following loans under private school loan consolidation:
- Private education loans (non-government education loan).
- Loans used for travel expenses for school .
Comparing Private consolidation with Federal Consolidation:
Private student loan consolidation has a higher interest rate as compared to federal student loan consolidation, so if you have federal student loans which are eligible for federal consolidation, go for that only. This will help you save more money and get more benefits.
If you go for private school loan consolidate you will no longer be eligible for borrower benefits that include; grace period, deferment and forbearance that you can avail if you opt for federal loan consolidation. With a private school loan consolidation, you may be provided with an extended repayment term most of the time (up to 30 years). However, this also depends upon your loan amount and there is no pre-payment penalty.
Eligibility for Private School Loan Consolidation:
- Anyone with outstanding non-federal education-related expense can apply for private school loan consolidation.
- The candidate should be at least half-time enrolled in a degree or technical/diploma program.
- Has a minimum of $10,000 in private educational loans.
- Is in repayment status of private education loans at the time of application.
- Has good credit standing.
- Has proof of accommodation and present income.
Companies offering Private Loan Consolidation:
NationalCity:
- Borrow what you need - from $1,500 to $40,000 per academic year.
- Pay for other education-related expenses.
- Competitive interest rates.
- Receive a check within 5 business days.
- Pay it back after you graduate.
- Delay repayment while you are in school.
- Up to 0.50% interest rate reduction with automated payments.
StudentLoanConsolidator:
- Lower your monthly payment amount by as much as 45% in the first year.
- No application fees.
- No prepayment penalties.
- Fast and convenient online loan application.
- Conditional pre-approval decision within minutes online or by phone.
- 0.25% interest rate reduction for automatic checking account withdrawal.
- Interest-only payments available for the first 24 months of repayment.
- Interest payments may be tax deductible.
EdFed:
- Interest rate reduction of 0.25% when you sign up using auto-debit to repay your loan.
- Simple repayment terms, low, variable interest rate and no penalties for prepayment.
- One low convenient monthly payment to one lender.
- With EdFed, you work with one loan consultant throughout the process of consolidating your private educational loans.
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