Tag Archives: student loans

Features of Student Loan Consolidation

July 9, 2020   Loan Tips

In today’s scenario, where the whole world is reeling under a huge economic crisis, paying off multiple student loans can prove to be really difficult. Apart from the fact that you need to remember the monthly repayment dates for all your student loans, keeping a track of the varying interest rates and paying off huge sums of money each month can surely disturb your monthly budget. Therefore, if you are looking for an option that is far simpler and can assist you in lowering your monthly repayments, you can go ahead and consolidate student loans. Yes, by consolidating your student loans you end up making life much easier for you. Here are some key features of student loan consolidation:

• To begin with, instead of paying simultaneous monthly payments, each with a different date, you simply need to make a single monthly payment. • After you consolidate student loans, you are presented with a fixed interest rate that is capped at 8.25 percent, which is much lower than the interest rate of your student loans. • The monthly payment, if you consolidate student loans, becomes pretty less than the total of your individual student loan monthly payments. • The repayment period can increase, if you consolidate student loans. Therefore, instead of paying off all your loans within 10 years, you can consolidate them and extend the loan repayment period to 12, 15, 20, and even 30 years. • You can pay off your single consolidated loan electronically. Most lending companies even offer you 0.25 percent off on the interest rate, if you pay your monthly installments electronically. • You do not need to pay any processing fees to consolidate student loans. The whole process is free of cost, which is yet another advantage for you. • Students as well as parents who borrowed the money can consolidate student loans. However, students and their parents cannot combine their individual loans for consolidation. This is because only loans from a single borrower can be consolidated. • You have the option to consolidate student loans with any lender. This provides with the facility to look for lenders that offer the lowest interest rates and other benefits.

With such great features, it is not surprising that more and more students opt to consolidate student loans. This makes life relatively easier for them and allows them to concentrate on their job and career. By getting to consolidate student loans, you know how much exactly you need to shell out each month. In addition, the single monthly payment, which can be paid electronically or through direct debit from your bank, relieves you from remembering the monthly loan repayment date. A lower monthly repayment option is one feature that most students look out for while repaying their student loan. This is because most fresh graduates need to be contended with a low monthly salary that can increase only through performance and experience. In such a situation lower monthly repayments are really welcome to such graduates. This and the above mentioned features, is exactly the reason why student loan consolidation is gaining such prominence.

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Availability of Student Loans With No Security

July 4, 2020   Auto Loans

Many wonder if there are student loans offered with no collateral. There is no simple answer to this question as it really depends on the applicant’s qualifications. There are of course federal loans that require no security and even private loans that do not require security but qualifying for them is not such an easy task.

Thus, in order to know whether you will be able to obtain a student loan with no security you need to know the different loan types offered and whether you meet the requirements needed to get approved for federal or private unsecured student loans. Also, if you can provide collateral to secure a student loan, you should rethink your decision of not doing so.

Federal Student Loans And Private Unsecured Student Loans

Federal Student Loans are student loans subsidized by the government, the interest rate they charge is significantly low since they are meant for promoting education and handled by government agencies with that purpose. The interest rate charged by these loans is even lower than the rate charged for home loans or home equity loans. However, the rest of the loan terms are not so advantageous. Though the repayment program can be long, usually, the loan amount you can obtain through these loans is not good enough to cover all college expenses.

Besides, these loans are awarded according to the needs of the applicant because they are meant to promote education for underprivileged applicants and thus, not everybody can apply for these loans and get approved successfully. Only those that meet these particular requirements of federal student loans should contact the government agencies to obtain further information on these loan programs.

Private unsecured student loans do not require collateral either. Thus, non homeowners can easily apply for these loans. However, the interest rate charged for these loans is usually high. Thus, only those that can afford the monthly payments on unsecured student loans will be able to get approved for them.

Unsecured student loans subsidized by private non profit organizations charge a lower interest rate but suffer the same restrictions as government loans. These loans are either awarded according to the needs of the applicant which excludes those with repayment capacity or according to merit. This last group of loans is meant to promote those who have had an outstanding performance on previous studies and thus, the institution wants to support their career.

Reconsidering Secured Loans

As you can see, getting approved for unsecured student loans is not that easy. So, if you are a homeowner or you have relatives or friends willing to offer an asset as guarantee of the loan, you should reconsider applying for a secured loan as you will get approved more easily and you will also get better terms on your loan including lower interest rates, higher loan amounts, longer repayment programs and thus, lower monthly payments that will be a lot easier to afford. As regards collateral, as long as you make sure you can repay the loan installments there is no reason to fear repossession of the property.

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