When looking at student loan debt, it can feel overwhelming to figure out how to make all the payments manageable. It’s especially challenging when you have both federal and private student loans. Show
Student loan refinancing and federal loan consolidation can simplify matters. But can you consolidate federal and private loans together? Let’s take a look at your options to consolidate federal and private loans so you can make a decision that works for you. Can you consolidate private and federal loans?When looking to consolidate student loans, many borrowers wonder if you can put private and federal loans together. The reality of the situation is that it’s possible, but it comes with some caveats.
Before you decide to consolidate federal and private loans with refinancing, it’s essential to carefully consider the situation and determine if it’s the right move for you. How to decide if you should consolidate private and federal loans togetherThere are some critical factors to consider as you decide whether to consolidate federal and private loans through student loan refinancing. Here’s what to look at before you move forward. Interest rateWhile there are some attractive interest rates available through student loan refinancing, you might not always get the best rate. Organizations such as Juno can help you with student loan refinancing, giving you access to the best deals. However, even then, you might not get the best interest rate compared with federal loan rates. Depending on the disbursement date and type of loan, federal loans have varying interest rates. Double-check your current rates to see if refinancing will give you a better rate. You’ll have access to the best rates if you have a good credit history and income or if you can find a co-signer who does. With federal loan consolidation, you’ll have a weighted average rate for the student loans you decide to consolidate, rounded up to the nearest one-eighth of one percent. Your credit score and income don’t matter with a federal loan refinance, and you won’t get a special break on your interest rate. Remember: You’ll be able to pay off your federal student loans with a private refinance, but you won’t be able to use federal loan consolidation for your private student loans. Take a look at the current situation and get quotes from lenders to see what your interest rate is likely to be. Then decide whether you can save money on interest over the life of the loan when you refinance your federal loans with your private loans. Federal student loan benefitsIt’s not just about the interest rates, though. Federal student loans come with a variety of benefits that you don’t get with private student loans, including:
Because student loan refinancing is paying off other loans, once you use it on your federal loans, you no longer have federal loans. Instead, you’ve used a private loan to pay off your debts to the federal government. None of these federal loan benefits apply to you anymore. If you think you might want to apply for student loan forgiveness, or if you think you might need access to income-driven repayment or deferment, it might not make sense to refinance your federal loans. Refinancing your student loansEven though you can consolidate private and federal student loans together, it’s not always the best idea. Some borrowers choose to refinance their private student loans to one lower interest rate and consolidate their federal student loans separately. While that doesn’t simplify matters as much as having just one payment and one interest rate, it can be beneficial in some cases. You still make things easier by reducing the number of payments you have. Overall, you’ll potentially pay less in interest on your private student loans when you refinance. However, you keep your federal loan benefits — especially access to PSLF — intact just in case you need them. As you refinance, don’t forget to compare lenders. Juno makes it easy by providing partner deals to see what’s available to you depending on your situation and the types of loans you have. Compare rates and choose a lender that works for you. Then, decide which loans you want to refinance and which you want to keep with the government for a separate consolidation. Juno's Exclusive Student Loan Refinance DealsCosigner: Can’t be refinanced with a cosigner Rates: Fixed starting at 3.75% APR, Variable starting at 2.99% APR including autopay and Juno discount. Juno benefit: Rate reduction of 0.25% Check: Soft Credit Check to get rates; Hard Credit Check to refinance Cosigner: May be able to refinance with a cosigner Rates: Fixed starting at 3.99% APR, Variable starting at 2.75% APR. May include autopay discount. Juno benefit: Up to $1,000 cashback based on loan amount Check: Soft Credit Check to get rates; Hard Credit Check to refinance Cosigner: May be able to refinance with a cosigner Rates: Fixed starting at 4.49% APR, Variable starting at 2.50% APR Juno benefit: Rate reduction of 0.25% Check: Soft Credit Check to get rates; Hard Credit Check to refinance Juno's Exclusive Student Loan Refinance Deals
Bottom line Can you consolidate private and federal student loans together? Yes, but only if you pay them off through the process of private refinancing. You won’t be able to combine federal and student loans together if you go through the federal student loan consolidation process. Carefully consider your needs and long-term financial goals before you move forward. Then, decide on a course of action most likely to benefit you over time. Can I consolidate my student loans with a personal loan?Most personal loan lenders have strict policies that prohibit paying for school with a personal loan or refinancing existing student loans with a personal loan. Personal loans have shorter repayment terms: Personal loans tend to have short repayment terms — often seven years or less.
Can you combine two loans to make one?Mortgage consolidation gives you the option of merging multiple loans into one. It's a good way for some people to save money or get a little more breathing room in their monthly payments. Learn more about the mortgage consolidation process and see if it's right for you.
Can you consolidate private student loans into a Direct consolidation loan?Like the federal government, private companies offer the option to consolidate multiple student loans into one. But while you can't transfer private loans to the federal government, you can consolidate both federal and private loans with a private lender.
Can I consolidate student loans from two different lenders?Yes, you can consolidate (i.e., refinance) student loans from different lenders.
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