Consolidating student loans pros and cons
Always talk to your servicer before making a choice. You can select between the Standard Repayment Plan, Graduated Repayment Plan, Extended Repayment Plan, or one of the 4 income-driven repayment plans.You will have to complete an additional plan request form for the plan you choose. After signing and submitting it, it generally takes about 2 months for the new consolidated loan to be disbursed.Student loan consolidation may help to lower payments and pay only one monthly bill. If your loan is in default, you must make arrangements to bring it current.You may also be eligible for a new repayment plan of up to 25 years. Watch out there are common mistakes to avoid before choosing consolidation. Usually this means making 3 timely payments in a row, or applying for an income-driven repayment plan.In the program you will find: Direct Subsidized: Loans for students who demonstrate financial need.
You will also retain the ability to apply for loan forgiveness, deferment, and forbearance in the future.
Deferments are given for economic hardship, unemployment, and returning to school.
During deferment, you don't have to make student loan payments.
There are several loans in the Direct Loan Program.
It is one of the largest student loan programs available.