What is Federal Consodilation Loan?

A Federal Consolidate Loan is a loan that repays all your outstanding eligible federal student loan and replaces tha multiple payments you may be maing each month with a singlr student loan payments.This loan is not to be confused with private consolidation loans which may consolidate other types of debt (credit cards,private loans,rtc,.)in addition to student loans, but do not have the same benifits as a federal consolidation loan.



How do i apply for a Federal Consolidation Loan?

• STEP 1: Obtain all of your student loan information: loan tyoe,current balance,lender's name and address,account number,and the current interest rate.


• STEP 2: Gather all of your personal information (address,home telephone number. Social ecurity number, e-mail address, driver's license number, date of birth and two references) and employer information (name, address and telephone number).


• STEP 3: Select a lender you would like to work with. Here's a tip: if one of your current lender offers consodilation loans, you may want to consider working with them since they already have your loan information on file.


• STEP 4: Make sure your total loan balance meets the lender's minimum requirement to obtain a consodilation loan.Some lenders requires a minimum of $7,500 to consodilate; some requires $15,000.These amounts will vary from lender to lender.


• STEP 5: Complete a consolidation loan application,The application process may include the ability to complete an on-line application, downlaod and print application or request a paper application by telephone or e-mail. Some lenders will allow you to complete an application over the telephone. Make sure you have all of the information in steps one and two ready before you make calls.


• STEP 6: Choose a repayment plan.The lenders will offer you several repayments options.Review and pick the one that best suits your financial situtation.


• STEP 7: Read and sign the promissory note.Some lenders may offers you the option of signing electronicaly; pthers may only yake a signed paper promissory note.Either way,you accept the loan with your signature.


• STEP 8: Maintain your payment schedule with your current lender.Funding fot the consolidation loan can take six to ten weeks to process depending upon the lender; it is the important to keep maing payments to your current lender if you are in repayment status.


• STEP 9: Review the laon disclosure statement.After your loan is disbursed, a disclosure statment will be sent to you. It will contain detailed information regarding your new consolidation loan. Review it to make sure all loan information is correct and keep it in your files.