Consolidating federal student loans interest rates

The best banks to refinance and consolidate student loans look at a borrower’s creditworthiness when determining whether or not to approve them for a new loan.Most lenders will look at a borrower’s credit score and monthly income to determine if they are a good fit for the loan product they are applying for.Borrowers should look for lenders that do not assess prepayment penalties.Lenders who charge for their services should be scrutinized closely.Borrowers who consolidate federal student loans through federal loan consolidation programs will have an interest rate that is equal to the combined average interest rate of the federal loans being consolidated.

Refinancing can save you money each month through lower payments, and save you money over the life of the loan through lower interest rates.Lenders will typically make a decision in a matter of minutes.Applicants who are denied on their own can reapply with a cosigner.This will show up as an inquiry on a credit report which can impact a credit score.Too many inquiries over a long period of time can lower a credit score, so you need to be certain you want to pursue refinancing and/or consolidating your student loan before completing the application process.

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