Student Loan Consolidation Plans For College Loan Repayment–Should Borrowers Consolidate Debt After Graduation?

Student loan debt which comes from multiple sources may be difficult for some graduates to pay as these multiple monthly payments on various student loans can be managed and burdensome for some, especially recent graduates who may have entered an unwelcoming job market. Yet, numerous college graduates have turned to student loan consolidation plans as a way to find affordability in their payments which must be required after a typical grace period is given.

While many students do have the opportunity to forego repaying their student loan for a set period of time after graduation, inevitably these repayments must begin and, for those in a bad financial position or with a large amount of student loan debt, this is a difficult task even for graduates who may have found an employment opportunity after college. Yet, a student loan consolidation, like traditional debt consolidation loans, allow students to group various debts into one obligation, which can make monthly payments more affordable.

There are some types of loans which may not be consolidated together, as an example private student loans cannot be consolidated under a federal student loan consolidation plan, but options for students to consolidate debt at reasonable interest rates are often available, especially on federal student loan debts. Yet, many question as to whether college graduates should consolidate their student loans after graduation, as there are some who may not benefit from consolidating.

Essentially, students who have benefited from student loan consolidations are those who may have multiple student loan debts within the same category, meaning either private or federal loans, and are simply unable to meet the total amount of repayment which is due on the loans. Obviously, a graduate would not want to miss payments on their student loan debt obligations, but financial advisers often counsel students to take stock of their student loan debt situation before consolidating.

There have been some cases where students who recently graduated were able to meet multiple student loan debt payments separately, which may allow for a more affordable debt repayment option, as smaller principal amounts are easier to erase and can come at an overall lower cost than one large principle through a consolidation loan. Yet, the affordability of a consolation loan versus repaying debt separately will heavily depend on a student’s personal financial situation and the amount of student loan debts they have outstanding.

Some students who did choose to consolidate their debt were able to erase this consolidated loan in a timely manner by simply meeting more than the minimum monthly payment which was required, but again this will be dependent upon an individual’s financial position. However, concerns over affordability when it comes to repaying student loan debt should be addressed early, and graduates are often advised to contact their student loan lender if worries about meeting payments are present, since finding a solution to student loan debt repayment early will obviously put a graduate in the best position to find a solution to their repayment obligation and avoid missed payments on their debts.