Consolidating federal grad plus loans
Second, you may be able to get a lower interest rate, which will save you money over the life of the loan.
Many borrowers don’t have great credit when they start college, simply because they haven’t built it up yet.
If you want to consolidate your Federal and private student loans, you have to do it through a private lender.
If your Federal loans are at 6.8%, and you aren’t taking advantage of any of the special repayment plans, you may benefit by consolidating to a private student loan with a lower interest rate.
Grad PLUS loans are actually made to the students, not the parents.
In other words, repayment is the responsibility of the student who applies for the loan.
For example, a ,000 Federal student loan at 6.8% will cost a borrower ,619 to repay – ,619 in interest.
By contrast, if that student refinanced into a private student loan, they could significantly lower their interest rate and monthly payments.
This is one of the best ways to lower your current payment on your Federal student loans.