Student loan debt is a grave concern in modern America. In fact, the amount of debt from student loans topped $1.3 trillion at the end of 2016, and 68% of seniors graduating from public and nonprofit colleges have student debt – the average is $30,100. It takes borrowers an average of 21 years to repay their student loans, while 28% of students are in default (or miss payments for 270 days or more) within five years of entering repayment.
The picture painted by these statistics is clear: many borrowers are in over their heads with student loan debt and are looking for relief. Student loan consolidation or refinancing can be a great tool to use for those looking to save on, or simplify, their monthly payments, but going that route can also have serious consequences if not approached carefully – there are even student loan consolidations scams to be aware of.
That’s why we created this guide – to give borrowers a useful resource that empowers them to choose if student loan consolidation is right for them and which type may best suit their needs. We start by discussing the basics of student loan consolidation and refinancing, and comparing the benefits and drawbacks of federal and private consolidation loans. We then detail a step-by-step guide to using and choosing consolidation loans. The last section is dedicated to identifying the best private consolidation loans for those with a few different financial profiles.