Do yourself a favor: Hate debt; start paying it off; spend less than you earn.
Student loans usually appear on a credit report as multiple loans, but that doesn’t look bad to lenders.
Surveys confirm that about two-thirds of those who borrow against their home equity to pay off plastic run up more credit card debt within two years.
So here’s the big sticking point: couples should not consolidate until they have changed their habits.
Consolidation, on the other hand, is a strategy used when you owe balances on more than one student loan.
As you may have experienced, since each of those separate loans has its own monthly payment, interest rate, and terms it can be complicated to manage all of them.
There is one huge downside in consolidating your loans, however.
If you haven’t solved the problems that put you into debt in the first place, you’ll end up off.
Having more accounts is not automatically a negative factor in your credit history.
Before you consolidate, consider the following pros and cons: Note: Just remember, you must continue making payments after submitting your application until you receive notice from your servicer that underlying loans have been paid off.
You have the option to select the servicer of your choice (of which, Nelnet is an option) After your new Direct Consolidation Loan is complete, you may still add more eligible loans to your existing consolidation.
By doing so, you “consolidate” your student debt into a single loan.
To answer the question of which is best for you – a refinance or a consolidation loan – it helps to first understand the primary benefits of each and the main difference between refinancing and consolidating student loans. When you refinance a student loan, you take out a brand new loan.