Sallie mae rates consolidating student loans

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The interest rate on your consolidation loans is the weighted average of the interest rates on the loans you have now, rounded up to the nearest 1/8 of a percent and capped at 8.25 percent. You can get help doing the math with an online calculator at the Federal Direct Consolidation Loans website.

Click on “Borrower Services,” then “Online Calculator.” Interest rates are determined by the federal government and change each year on July 1, so check with a lender to get their take on possible rate fluctuation.

You may also have access to a new repayment schedule (like an income-contingent plan) that’s a little easier on your wallet.

If you don’t care about the extra cash and just want a consolidation for the simplicity of a single monthly payment, you can use any money you save to pay down the principal.

Unlike with refinancing, serialization won’t lock in a good interest rate. You shouldn’t pay origination or any other fees to get a consolidation loan.

Yes, a married couple can jointly consolidate their loans, but it may not be a good idea.

Current law dictates that you can only consolidate once, so if you consolidate at a 6 percent interest rate and rates later drop to 3 percent, you’re out of luck.

There are two exceptions: if you’ve since gone back to school and acquired new student loans, or if an outstanding loan was excluded from your original consolidation.

(There are no prepayment penalties for student consolidation loans.) If you have only a couple more years or a few thousand more dollars to go till you pay off your student loans, consolidation is probably more hassle than it’s worth.

Switching to a new lending institution might eliminate any benefits you’ve earned, like lower interest rates for on-time payments over the years.

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