Going to college can be extremely expensive. Most college students, after graduating, typically have over ten thousand dollars in debt. It can be very difficult to juggle lots of different private loans, and it can cause harm to your credit score when you have several outstanding accounts. Fortunately, there are ways to make your student loan repayments more manageable. Personal student loan consolidation will allow you to combine your student loans into one. Instead of making several payments a month towards a number of different outstanding loans, you can simplify your debts with student loan consolidation so that you only have one payment a month.

Personal student loan consolidation, also known as private student loan consolidation, is different from federal student loan consolidation. Consolidated loans for private student loans typically do not have the lower, fixed interest rates that come with federal loans, nor is it possible to defer payments in the case that you find yourself in a bad financial situation. Read on to learn more about personal student loan consolidation.

Guide to Consolidating Private Student Loans

When planning to consolidate student loans, it's important to be aware of your credit score, as that will have an affect on your interest rate. All Americans are entitled to get a free credit score every 12 months from the 3 leading credit report bureaus -- Equifax, TransUnion and Experian -- otherwise, in most states, you will have to pay in order to get your report. If your credit rating has improved by 50 points or more since getting your student loans, you have two options: you can a. contact your current lenders and see if they will lower your current interest rates, or you can b. see about getting a consolidated loan with a lower interest rate than your outstanding loans.

In order to get a consolidated personal student loan, the combined amount owed between all of your loans should be, at minimum, $5,000 and, at maximum, $300,000. The minimum and maximum amounts may vary depending on where you are getting personal student loan consolidation.

Since lenders do not compete on price, it's a good idea to shop around to see which lender will offer you the lower interest rate. If you do not have very good credit, or you have an undergraduate degree, you will need a co-signer. Typically, a co-signer with an excellent credit rating will help you to get a lower interest rate. Keep in mind, though, that if you default on your loan, your co-signer will be stuck paying it off.

Some personal student loan consolidators will charge you with a pre-payment penalty if you pay off your loan at a faster rate, so try to find a lender who will not penalize you in case you pay a larger monthly payment than initially agreed to. More than that, consolidating private student loans is a big financial responsibility, so make sure you are prepared to pay off your loan in full within the time allotted.


Before you agree to any consolidated loan, always make sure you completely understand the terms. Personal student loan consolidation can be a great option for people burdened with several private school loans, but it's not for everyone. It's a good idea to do a lot of research before making any decisions, since you will be saddled with your consolidated loan for about 25 years, unless you are able to pay it off at a faster rate.