Consolidating key alternative loans

02 Jan

Making payments on time is key to having a good credit rating.

If consolidating multiple debt payments into a single one can help you do that religiously, it might be worth considering.

If you just want to reduce your monthly payment, discuss the federal loan repayment options available with your loan serviser. Single Payment If you have loans with multiple servicers, you send a monthly payment to each.

However, if you consolidate all those loans, you make a single payment to one loan serviser.

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With a fixed rate, you know what your interest costs will be, regardless of the movement of the market interest rate that determines whether variable rates rise or fall.

Also, you might lose eligibility for certain cancellation or forgiveness programs, especially if you are including Perkins Loans in the Consolidation.

(In either case, check with your loan serviser.) More Interest Paid With a longer repayment period, you'll pay more interest over the life of the loan.

Consolidating should be a part of a larger strategy to decrease debt.

It can be tempting to go on using your newly paid-down cards after consolidating.