No credit card required
Browse credit cards from a variety of issuers to see if there's a better card for you.
I would recommend against consolidating your loan if you don't need to do it (full disclosure, I have a consolidated loan)
They will close your current student loan tradelines - they will stay on your report for up to 10 years, continuing to contribute to your average age of accounts, and other aging factors in your FICO score. Any lates or derogatories will also stay on your report, they don't get transferred or removed before the usual 7 year exclusion period.
A single NEW tradeline will be reported, so you will have a brand new, age of youngest account = 0, 100% utilized installment loan. While not necessarily a bad thing, it could drop your scores a bit, which will rise back up over time.
I usually recommend against consolidation because the math doesn't work out in your favor as long as you keep the tradelines positive. A lot of positive, old tradelines really help your score a lot. I don't harp on the utilization as much, because the utilization of installment loans doesn't have nearly the impact as revolving tradelines (credit cards) do. And if there is a penalty of having loans over 100%, no one's been able to see it (so it's likely small if any at all). Utilization over 100% on student loans is not uncommon at all.
What the interest thing is: all of the interest that is currently on your other (older) student loans that has accrued will be capitalized and turned into principle on your new loan. That could be pretty unfortunate depending on how much interest you have built up (with 0% payment, it could be significant). In addition, your interest rate will be a weighted average in your new loan (from your old loans).
Sabii is usually around these parts - and way more knowledgable regarding the impact this may have on any forgiveness options you could have. I know that changing loans can alter your eligibility for forgiveness, but I am not really well versed in that aspect.
@Sitori wrote:
The only thing that made me call them today about consolidating was Bc I got a really weird alert from CK about my accounts changing. So when I logged in, it showed all of my 9 student loans with an increased balance of some sort plus some really weird remark about “deferment removed”.
I have no clue what this is Bc I’ve never seen any of it before, BUT it DID show on all 9 accounts and then on top of it showed a 60 point decrease in my scores!!!
When I called fedloan she said she had no idea what it was except that maybe my interest reported and made the balances higher? But why wouldn’t it have done this prior? It’s never happened in all the years I’ve had the loans so I have no clue what it is or what it means. I also don’t know how to fix it, except to consolidate them all. This is the second time I’ve had some HORRENDOUS decrease in score bc of them.
When applying for the consolidation, it told me that my new consolidated interest rate would be around 4.5%. Half of my current loans are at 3.5 and the others are at 6. So I don’t know if that means it would be better or worse in the long run.
I can’t risk anything happening to my score right now unless it’s good. I need to get approved for too many things. If this 60 point decrease reflects on my actual FICO scores I’ll DIE. I don’t even understand what it is!!!
It's really good that you called FedLoan. Check your account (with them and by downloading your file at the NSLDS) to confirm they're still deferred. I never, ever trust servicers, because they tend towards incompetence (probably because they're covered by the feds and there is no penalty for it).
I would recommend checking your FICO8s somewhere to see how those are shaping up. I've found Vantage to be really squirrely, particularly with loan utilization where FICO doesn't mind it as much. If you go to Experian.com, you can get a $1 7 day free trial and pull your three CRA FICO8s & reports. Experian will also give you the rest of their scores. You can cancel your subscription by "updating" your account to the free one within that 7 days and not owe them more than the dollar - I usually do it when I'm checking up on something.
I think the weightest average of interest works out not-too-terribly in the end, however, that outstanding interest being rolled into your new principle could have a bigger impact.
And I get you on the number of tradelines - miss one 30 day payment on a consolidated loan, 1 late. Miss it with your 9 and that's 9 30 days and pretty ugly. You'll have to decide if it's worth it to you in the end.
But for now, yeah, I wouldn't consolidate until you sort out your other needs. You can consolidate regardless of your credit score after you're done with the auto loan, you don't need to stress that until later if that's the route you want to take.
I heard about EduLoan Docs. They offer federal loan consolidation assistance by helping former students through the application process and by selecting the best repayment or loan forgiveness plans for their unique situation.
@Anonymous wrote:I heard about EduLoan Docs. They offer federal loan consolidation assistance by helping former students through the application process and by selecting the best repayment or loan forgiveness plans for their unique situation.
I just went through their website.
They are offering to sell me help that the servicer's rep gave me for free (which I could have done on my own if I'd seen this forum first), so I'd DEFINITELY not recommend using them.