Student Loan Consolidation

Student loan consolidation is one of the most used methods for reducing and working off student debt. If you want to consolidate debt, whether it’s a student loan debt or not, you have to follow a certain process. However, this process is easy to follow and will absolutely not require big efforts from your side.

Here is what you have to know about the consolidation process: You combine all of your various student loans into one large loan. Instead of paying toward all your loans each month, you make one payment towards this one loan. So, what will I gain with this, you may ask. If you compare the numbers before and after you have consolidated your student debt, you’ll understand that it’s a very good deal.

Student Loan Consolidation
Student Loan Consolidation

To start out the working career with an overwhelming amount of debt is a daunting prospect to put it mildly. But the fact is that many college graduates unfortunately are facing this situation. Fortunately consolidating your student loans is a great way to meet the challenge of getting rid of the burden of debt from school or college.

The main benefit of consolidation is that you’ll normally pay a lower interest rate then compared to what your various loans are already set at. This works the same way as refinancing a home in order to have a lower mortgage payment. And be aware of the fact that the current interest rate is the lowest it has been in almost 40 years. When you do a consolidation you’ll pay one interest rate, not several different rates. And at the time you took these loans, the rates were probably higher.

And this means money saved: A lower interest rate on a relatively big loan can save you thousands of dollars in the long run. And in addition to this, some lending companies offer rate reductions for students consolidating their loans while they are in their grace period. A warning though: Stay away from companies that require you to start your payment immediately after the grace period. There are financing companies out there that don’t require this. Go to them!!!

And as if this wasn’t enough, some companies even offer additional rate reductions. I have heard about companies that reduce your rate by one percent if you make all of your payments on time for two years. And this comes in addition to the discounts described above. One percent may seem small, but if you see it in a perspective of, let’s say 20 years, which is a normal payback schedule, it can mean lots of dollars saved.

Another benefit with student debt consolidation is saving time and effort. It’s much easier to handle one payment monthly than several separate payments.

A convenient way to do the monthly payments is to let the loan company deduct it directly from your bank account. Some companies allow that. And if it is a really good student loan consolidation, it will even give you a little interest rate reduction by handling your loan payments this way.

So, if you find that loan consolidation is (in) for you, your challenge is to decide which loan consolidation company to approach and finally select. What I would recommend is that you make a list of all the questions you might have, call a few companies and speak with their representatives. Or you can go online to find a good student loan consolidation company. There are some great companies out there.

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How To Get The Best Interest Rates On Used Car Auto Loans

Nobody wants to pay more than they really have to for what they buy, and that is true of used car auto loans as well. Since the amount that you pay back to the lender is tied to the amount of interest charged, it’s important to get the best auto loan rates that you can. Over the course of an auto loan that stretches over 5 – 6 years you can pay out thousands more on an loan that has higher than normal interest rates. So one of your main goals when arranging financing for the car purchase is to get the best interest rate that you can.

Used Car Auto Loans
Used Car Auto Loans

One of the most important points to realize is that you will almost always get the best auto loan deal by arranging it yourself before you even go car shopping. It may not be the easiest and most convenient thing to do, but getting your car financing lined up in advance can save you lots of money over the life of the loan. A lot of car buyers prefer to just let the dealer arrange the financing for them instead, and by doing that they wind up paying more than they should for that loan. Car dealers rely on this convenience factor and make plenty of money in their finance department as a result.

Typically, the dealer writes up your contract with a preferred lender who has an arrangement with them to pay the dealer so much money for every loan that they write through that company, and the dealer can also mark up the interest rate to pad their profits too. Of course, someone has to pay for that extra that the dealer gets, and that is you, the consumer. That’s why lining up your own uaed car auto loans in advance is a smart move.

Contact your local banks and credit unions if you belong to any, and have them make a loan offer for you. Then go online and get loan quotes from the major online auto financing sites that specialize in dealing directly with consumers. There is always a better loan deal that can be had, so the more you shop the more chances you have of getting lower rates and a better deal. You will also no doubt find that loan arrangements will vary not just a little but sometimes a lot between different companies, so that’s why it’s good to do as much shopping as you can first.

You should also know your credit history, and should have kept any errors off your credit report before you start loan shopping too. The credit score that is in your credit history will decide whether or not you get the best auto loan rates. So keep your credit score high to avoid losing money on future loans. If for any reason, your credit history suffers, get back on track as soon as you can and start paying your bills on time and in full. Often you can turn your credit score around in just 2 -3 years time even after suffering a serious setback.

Understanding the lending process and shopping for the best deal on your own puts you in control of your loan arrangements, and that means that you will be a smart consumer that saves money by getting the best auto loan rates possible each time you buy.


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When Should You Consolidate Student Loans?

If you have just graduated from college, the likelihood is that
you are under a large amount of debt in the form of student
loans. You might be wondering if there is any way to reduce the
amount you have to pay. One solution for reducing your
debt is to consolidate your student loans.

Student Loan Consolidation

Student loan consolidation is similar to refinancing a house on
better terms: although the principal of the loan will not be affected,
the interest rates you can lock in when you consolidate student loans
to a fixed rate can be substantially better, reducing your monthly
payments by up to forty percent. Plus, you might be able to stretch
out your payment time to reduce your monthly payment amount
even further.

The disadvantage when you consolidate student loans during your
initial six-month grace period is that you must start making your
payments right away. This can be difficult if you have not found
a job after graduation, although you can wait until just before the
grace period ends to consolidate, and still receive the lower rates.
Furthermore, once you have consolidated your student loans, you
cannot un-consolidate them again, so make sure to consider your
choice carefully.

How is Interest Calculated When I Consolidate Student Loans?
When you consolidate student loans, your lending company pays off
your government loan and issues you a new loan under its own name.
The typical way to determine the interest rate on the new loan is to
take the average interest rates on all of the student loans, and offer
a new rate that is an eighth of a percentage point higher (up to a
maximum interest rate of 8.25%).

Although agreeing to a higher interest rate might not sound like a
good reason to consolidate student loans, this rate is fixed over
the life of the loan, whereas the government rates will fluctuate.
Since rates are at an all time low right now, locking in the current
rates might be a good idea.

Furthermore, many banks give you ways to bring down the
percentage rates. For example, some lending institutions will
drop the rate by as much as a quarter point if you agree to
automatic deductions from a checking or savings account, whereas
others drop the rates after a certain number of timely
payments. As an additional bonus, there is no penalty for paying
off your consolidated loan early.

When Would You *Not* Want to Consolidate Student Loans?
Before you decide to consolidate student loans, you should
carefully consider your alternatives. For example, did you
realize that it might be possible to have your student loan
cancelled altogether? Student loan forgiveness options include
volunteering, for the Peace Corps for example, or working for the
government in a low-income area as a teacher or
doctor. Cancellation is not possible, however, after you have
consolidated your student loans. If this kind of work
interests you and is available, it could be a better option than
loan consolidation.

Another time to hesitate before you choose to consolidate student
loans is when you are close to finishing your payments.
Stepping up the payments and saving yourself some interest and
the hassle of consolidation might be more advantageous
to you.

Finally, there are loans that you might want to keep open because
they offer special advantages. For example, if you are
considering going back to school and you have a Perkins loan, you
would not want to consolidate that with your other student loans.

The government will pay all interest on Perkins
loans while you are in school, but if you have chosen to
consolidate student loans, you will not be able to receive this
benefit. You could always choose to leave any special
kinds of loans out of the consolidation mix, however.

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Find The Best Auto Loan For People With Bad Credit

An auto loan for people with bad credit is not as difficult to get as you might think. Wprking in your favor if you have bad credit, is that an auto loan for people with bad credit is still a secured loan. The lender keeps the title to your car until loan is paid in full. If you fail to pay your loan according to the terms of the loan, the lender can repossess your automobile and sell it to pay off your note.

Auto Loan For People With Bad Credit
Auto Loan For People With Bad Credit

This does not mean necessarily that it’s easy to get an auto loan for people with bad credit. Many lenders will want to see a stable employment history, and will want to make sure that your existing debts are covered by your monthly salary. Some lenders may want a minimum of three months employment with your current employer. And lenders will determine what percentage of your salary is spent now on monthly debt – your debt should be no more than 30% of your monthly income, but each lender will have their own guidelines. Although a lender is secured when they give you an auto loan for people with bad credit, the last thing the core lender wants to do is repossess your car.

If you have a stable employment history, and you currently can pay your debt with your income, then even if you have bad credit you can probably still qualify for an auto loan for people with bad credit. It’s possible to qualify for this type of loan even if you have bankruptcy, foreclosure, or other events in your past that have damaged your credit.

If you are trying to reestablish good credit, an auto loan for people with bad credit may be a good way to go. If you need a new vehicle, perhaps to take a job or to replace an existing vehicle, it’s worth it to try to use the auto loan as a way to establish good payment history. If you are in financial trouble, however, buying a new car simply to try to establish good credit is not a good idea. Try to keep your monthly debt payments to a minimum while you rebuild credit, and assess the auto loan in light of your complete financial picture. A better way to go might be a secured or unsecured credit card, in a small amounts such as $300 or $500, which will give you an opportunity to establish three to six months of good payment history. After that time you can qualify for better terms on an auto loan or other credit

However, if you do need a new car, and your credit history is poor, don’t despair. There are quite a few lenders to recognize that there is a market for auto loans for people with bad credit. You may have to pay higher interest on your loan, as well as an application fee. Some lenders may charge you additional fees, so be sure to ask before accepting a loan.

In addition, bad credit customers are often required to pay a prepayment penalty. A prepayment penalty is a charge that you are assessed if you pay off your auto loan before the end of the term. Lenders who write auto loans for people with bad credit are seeking a certain return on their investment; if you pay your loan early, they feel they have not received the profit they expected for their high risk loan. As a result some lenders charge the prepayment penalty to regain some of that expected profit. it’s highly recommended to avoid such a penalty, and if you shop around, you may be able to find a lender who will not charge a prepayment penalty.

Obtaining an auto loan for people with bad credit is not impossible, and it may be a good idea if you really need a new car. This auto loan can be another good credit item on your credit report as you rebuild your credit score.


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