Question about consolidating student loans?
I have loans that have previously been consolidated-one set of loans has an interest rate of 5.25% (that is the bulk of my loans) and the rest has an interest rate of 6.8%. Would it make sense to consolidate them together to get one interest rate. I think that most likely the 5.25% will be raised which will mean in time i’ll pay more for that portion of my loans. Is that correct? I’m not worried about getting smaller monthly payments as I already pay more than the minimum due each month anyway.
Can you help me to determine what the pros and cons would be of doing this now? Or if I should just leave them alone. I was on http://loanconsolidation.ed.gov/borrower/borrower.shtml tha website using their loan calculator and it showed that my interest would be 5.5% which isn’t much more than 5.25%-but is it worth it?
Thanks!
You have to compare the annual interest cost of having the two separate loans versus the one loan at 5.5%. If you lower you interest costs then it obviously helps to consolidate into one loan.
