Throughout the years spent in the university, many students and graduates access multiple student loans.
Juggling with a wide range of multiple loans, it is considered combining all those loans into one simple effective loan. This process is commonly known as student loan consolidation.
Loan consolidation is a process that combines several federal student loans into one consistent consolidation loan that retains all the benefits of the federal loans: flexible repayment options, insurance in case of job loss or going back to school and even forgiveness programs after years of service in certain qualifying fields.
Just a few years ago, not many individuals knew about the student loan consolidation companies and the solutions they provide.
The advantages of consolidating student loans include:
- One simple monthly payment
- Extended payment period between 12 to 30 years
- Graduated payment over the years, correlated with gaining work experience
- Income contingent payment, as the income changes, the monthly payment changes
- Income sensitive payment as a percentage of the pre-tax monthly income
- Lower interest rates
- Fixed interest rates
- Better credit score
There are two types of financial entities or companies that can offer you the student loan consolidation: federal and private.
Federal student loans companies allow the consolidation of the previously accessed federal student loans, while private loans and parent loans are not eligible.
Private student loan consolidation companies may allow you to consolidate private and federal loans, combined. Private student loan consolidation companies look for applicants with a great credit score and credit histories or qualified co-signers. The terms and conditions of the private loan consolidation companies vary with every company.
The best student loan consolidation companies of 2019 are:
- SoFi- Best lender for online student loan refinancing or consolidation
SoFi means trust and tradition and has been offering student loans since 2011. Borrowers with a credit score as low as 650 may be approved. After fulfilling the online application with SoFi, the instant decision is pronounced.
SoFi provides a wide range of loan types, with fixed and variable rates, 5 to 20 years in loan consolidation terms, additional discounts, hardship owners but no cosigner release.
- Common Bond- best lender with a co-signer release
Refinance, consolidate, reset.
Common bond offers a wide range of student loans since 2012, with fixed and variable rate types and co-signer release after 24 consecutive on-time monthly payments. Also, our service offers protections as up to 24 months of forbearance over the life of your loan and no prepayment penalties.
The approach is no big secret: lower rates, simpler options, and a world-class experience; all built to support an individual throughout the student loan journey and its consolidation.
- Discover- Best lender with no application, origination or late fees
Discover Student Loans is one of the largest providers of private student loans in the United States, with excellent customer service and financial stability.
While refinancing student loans is it still possible to put more money back into the budget, due to low and variable interest rates. There is also the possibility of consolidating a student loan through this company without a cosigner.
- Earnest- Best lender for borrowers with a low credit score
The company was founded in 2013 and it approves loan consolidation for debt to income ratio of up to 65%. The motto is “Pay less interest; pick a payment that fits the budget”.
Consolidation of the existing federal and private education loans into a single loan. This new loan does not have an origination fee and typically has a lower interest rate. There is provided with the option of removing a co-signer.
- Laurel Road- Best lender with a co-signer option
A financial entity division of KeyBank, Laurel Road has offered student loan consolidation services since 203, with the possibility of completing the entire loan process online.
The offered service is a simplified, personalized process without added costs or fees, without the requirement of hard credit pull.
Also, one of the assets is that it provides up to 12-month forbearance for qualified hardships, like involuntary job loss or unpaid maternity leave. A co-signer can apply to assume full responsibility for the loan after just 36 consecutive on-time payments of principal and interest.
In conclusion, these are how student loan consolidation companies can successfully help you manage your student loans and all the benefits and discounts you can benefit from. Essentially, it is all about matching the right student debt consolidation company for your specific financial needs. The ultimate reachable goal is: paying off student debt sooner and effective.