Student Loan Consolidation Rate – What Will Mine Be?
The answer to this question depends entirely on the type of student loan you want to consolidate. For example, consolidating federal student loans gives you the chance to obtain a fixed interest rate based on the weighted averages of your existing loans. The rate for a private student loan consolidation is more difficult to nail down.
Consolidation rates for federal student loans
With federal student loans consolidation, the rate is determined by the weighted average of all your loans’ rates, which is then rounded up to the nearest 0.125%. The determine the weighted average of your loans, you should first know their present interest rates and amounts. You can find this out by taking the “Financial Aid Review” from the NSLDS website.
To receive a precise information of what the final interest rate and monthly payments will be, go to the Department of Education’s calculator.
Consolidation Rates For Private Student Loans
As was mentioned above, this type of student loans are much more difficult to determine a specific interest rate. Just like taking a private loan, credit history plays a big role in determining the interest rate. Bad credit can mean you receive a higher interest rate or an outright refusal to consolidate.
Also private student loans consolidation is not very widespread like federal loans consolidation. Making a thorough research ahead of time and using a good co-signer will vastly improve your chances of being approved for consolidation with lower rates.
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