I am a student at Seattle Pacific University. I have both federal loans and private student loans. I did my FAFSA every year and 2 out of the 4 years I didn’t get enough federal financial aid (loans), so I had to apply for private student loans. I did it through Sallie Mae. Now the time has come for me to consolidate all these loans together. Unfortunately, private student loans cant be consolidated with federal student loans. The interest rates on federal’s are too low to consolidate with private’s. Here is my dilemma. Its ok though you have a lot of options I’ve looked into for refinancing those private loans.
Consolidate my private loan by paying more?
This is probably the route I am going to take. Most private loans don’t compete on price so a private consolidation loan is simply replacing the private loans with one another and combining their total value. Your main goal and its main benefit is to pay a single monthly payment. Additionally, consolidating your private loan resets the term of the loan. So your monthly payment will be lower. You do end up paying more on interest over the lifetime of the loan, then you would have if you did not consolidate, but that is the least of our worries when we have to eat and find a job right? Plus this interest is fixed.
If Brett Favre consolidated
Interest rates on Private loans are based primarily off your credit score. What this means is your score may have improved since graduation. If this is the case then you may be able to get a lower interest rate on your consolidated loan, by talking to the current holder of your loan or a consolidated lender. Here is where Brett Favre comes in. Even if your credit score has not improved, you can talk to your current holder and see if they will lower your interest rates, rather than lose you to another lender. If they do not oblige, go to the Jets and live in NYC. Kapeesh?
Who will consolidate my Private Loan?
Now you have to make a decision. Which lender will consolidate my private student loans? I have made a list that might help your decision. These are private programs that consolidate your loans so the interest rate is not set by the government, it is dictated by the lender. So ask questions like is the rate fixed or variable? and whether there are any fees or prepayment penalties.
Really Important: Don’t consolidate your federal loans with your private loans. The interest rates, and superior benefits of federal loans far outweigh that of a private loan.
They are not listed in any particular order. I found them on FinAid.org
Educated Borrower Private Consolidation Loan
$7,500 minimum. $300,000 maximum. Up to 30-year term. Introductory rate of LIBOR + 1% to LIBOR + 1.75% during the first year. After the first year the rate increases to LIBOR + 5% to LIBOR + 5.75%. Origination fee of 0% to 5%. No prepayment penalty.
MELA Private Consolidation Loan
$10,000 minimum. No aggregate loan limit for MELA loans. $125,000 aggregate loan limit for non-MELA loans. Variable interest rate updated annually based on the MELA tax-exempt bond auction rate plus a spread of 3.5%. The 2007-08 MELA auction rate was 3.85%, yielding a consolidation interest rate of 7.35%. The same interest rate is provided to all borrowers, regardless of credit. The fees vary based on credit score, with 1% for excellent credit, 3% for good credit, and 6% for fair credit. The repayment term is 15-30 years, depending on the amount owed (15 years for up to $20,000, 20 years for up to $40,000, 25 years for up to $60,000 and 30 years for more than $60,000). 0.25% interest rate reduction for auto debit. Borrowers must be a Maine resident, existing MELA borrower or a student who attended a Maine college. There must be a Maine affiliation to apply for this loan.
NextStudent Private Consolidation Loan
$7,500 minimum. $300,000 maximum. Up to 30-year term. No prepayment penalties. Variable rate loan. Interest rates of 3-month LIBOR + 1.00% to 3-month LIBOR + 1.75% during the first year and 3-month LIBOR + 5.00% to 3-month LIBOR + 5.75% after the first year. Interest rates vary quarterly. Origination fees of 0% to 5%. No prepayment penalties.
SC Student Loan – PAL Consolidation Loan
$5,000 minimum. $150,000 maximum. Loans must be in grace period or repayment. Borrowers under age 24 must have a creditworthy cosigner. Borrowers age 24 or older must either be creditworthy or have a creditworthy cosigner. Repayment term of 10 to 30 years depending on the loan balance. No prepayment penalties. Variable rate loan. Interest rates of 3-month LIBOR + 4.50%. Interest rates vary quarterly. No fees. No prepayment penalties.
Student Loan Network Private Loan Consolidation
$10,000 minimum. $300,000 maximum. 20-year term for loans less than $40,000. Up to 30-year loan term for higher amounts. Variable rate loan. Interest rates of 3-month LIBOR + 5.00% to 3-month LIBOR + 8.5%. Origination fees of 1% to 5%. No prepayment penalties. Cosigner release after 48 on-time payments, contingent upon primary borrower credit.
StudentLoans.com Private Consolidation Loan
(A Brazos company.)
There is only minimal information about the loans on the web site. This loan appears to be a private label of the Education Finance Partners Private Consolidation Loan.
Wells Fargo Private Consolidation Loan
$5,000 minimum. $40,000 to $100,000 maximum, depending on credit. Aggregate loan limit of $100,000 (including other education debt). Up to 15-year term. Variable rate loan. Interest ranges from Prime + 0.0% to Prime + 6.75%. No origination fees. Up to 0.50% interest rate reduction for auto-debit. 0.5% interest rate reduction after making 48 initial on-time monthly payments.
