Should I consolidate? Help please

[Anonymous]

Here is a summary of my loans (rounded off) and the interest rates. OUT OF STATE TUITION SUCKS!!!

 Subsidized loans:

$5,000 @ 3.61%

$4,100 @ 6.0%

 Unsubsidized loans

$13,000 @ 6.8%

$10,500 @ 4.02%

$6,500 @ 5.53%

$46,000 @ 5.95%

$21,000 @ 6.95%

Total of about $106,000.

The last two loans I don't know if they are Subsidized or Unsubsidized

I have 3 different companies that I am dealing with (MI-LOAN, Great Lakes, and Direct Loans)

I graduated in December and start paying on one of the loans in June. Should I consolidate these to make easier payments and possibly reduce the interest rate? When should I apply for the consolidation? Thank you

[Anonymous]

Anyone??? Please help. I am considering contacting direct loans to see if it is a good idea.

[Anonymous]

I looked into consolidation myself and from what I can understand the real benefit is that you will be making 1 payment instead of several. New interest rate with be a weighted average of current rates, so you will not be winning anything.

A good place to start is Direct Loans website. I believe they have a link to a website that tells you what to do to consolidate your loans.

Also, consider calling your university's financial aid officer and ask him/her for information.

Good luck! 

[cobaltnv]

Consolidation was good for me. As the previous poster said your interest rate will be a weighted average. However, some (many?) consolidation companies will offer an interest rate reduction of 0.25 or 0.5 pts if you sign up for automatic payment. My company also offered a 1pt deduction in interest rate after 50 months (I think) of clean payment history.

IMO consolidation make life easier as it can extend your loan out to keep payments reasonable, you have only one payment ot worry about, and you can get some rate benefits.

Good luck. 

[cobaltnv]

I guess I would also recommend shopping around for a good company to consolidate with. You might be able to get better offers (lower interest rates etc). As for the timing of consolidation --that is up to you. I would guess you are already getting the phone calls about consolidating (I still get them even 10 years later)

Cheers 

[LynnInMN]

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@cobaltnv wrote:

I guess I would also recommend shopping around for a good company to consolidate with. You might be able to get better offers (lower interest rates etc). As for the timing of consolidation --that is up to you. I would guess you are already getting the phone calls about consolidating (I still get them even 10 years later)

Cheers 

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There really isnt any shopping around to be done nowadays.  Gone are the days of the the back end perks..most of those companies have since closed and sold off their portfolios....those that signed on lost all of their perks.  Your interest rate is governed by law...a weighted average.  With your balance, unless you are walking into a high paying job, Direct Loans is probably the answer for you.

[cobaltnv]

Lynn,

  Thanks for the clarification. I guess a lot has changed in 10 years. I am still getting the perks promised me as the interest rate on my consolidated loan is 6%. Based on the weighted average of my original loans it should be 7.25%.