Government Student Loan Consolidation Pros and Cons

By Dominic Joseph

Student loans can feel like a crushing burden to many people. One possible solution is government student loan consolidation. Although this can certainly lower your overall monthly burden, it's important to do your research before you rush out to consolidate. There are some specific negative consequences you should also be aware of.

First off, let's discuss the benefits of government student loan consolidation. Once you consolidate, you will have a stable interest rate below 8.25%. This rate can never change so it will make planning for the future much simpler than it was before at a variable rate that could shift with the economic winds. You can also choose to extend the term of the loan out to 30 years which will significantly lower your monthly payments. All of this can be accomplished in a very simple loan application process. And don't worry about fees, credit checks, or prepayment penalties, because none of these apply.

It may seem like a slam dunk case, but there's more to it than that. When weighing government student loan consolidation, you must consider the negatives. There are two specific situations when you should never consolidate. If you are near the end of your loan term, there is no benefit and when your consolidated rate would be higher than your current rate you should absolutely hold off. There are additional reasons that might figure into your decision though. Consolidating now could mean missing out on a lower interest rate in the future since you can only take advantage of government student loan consolidation once. You will also lose your 6 month post graduation grace period once you consolidate.

Given all of these factors, take the time to look over your specific situation. Do further research and try to determine if government student loan consolidation is right for you.

Dominic J offers financial advice on how to lower your monthly bills. He has also written a detailed description of government student loan consolidation procedure. Stop by his madhubber profile at HubPages to read similar articles. Article Source: http://EzineArticles.com/?expert=Dominic_Joseph