Does consolidating student loans hurt your credit dating married info
If you have private student loans at differing variable rates of interest, you may be able to consolidate and get one new loan with a fixed rate of interest—a good move if rates have dropped significantly since you were in school.
That's because you'll start the loan repayment clock again and it will probably be for a longer time.
That can help you meet your other financial obligations.
The trade off is that because you repay the debt over a much longer period, it will cost you more over time to repay, even at a lower interest rate.
Therefore, even though your interest rate is the same or lower, you'll likely end up paying more interest.
For such installment loans, the important factors are how much total debt you owe and, of course, most importantly if you have missed any payments. It can be helpful if you have education debt from multiple lenders or student loan guaranty companies.
The truth is that lenders weight the average of the interest rates you're currently paying on your existing federal student loans and then round that number up to the nearest one-eighth of a percentage.
While the interest rate on the new loan may be lower than the higher interest rate, it will also be higher than the lower interest rate you're currently paying.
It is a little confusing because after you graduate, you probably will write one check to the lender each month to pay for the entire amount you borrowed.
As long as you make the payments on time and in full, the multiple student loans showing on your credit report will not have any negative effect on your ability to get new credit.