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I have 5 total federal loans from my college days. They vary in interest rates from around 2.8 to 6.8%. As pure chance would have it, my bigger loans happen to have the higher interest rates between 6.0 and 6.8%. I just went to some consolidation site and type in my numbers on their calculator form and it claimed I would save around $ 80 a month if I consolidated. Is this a good idea or not?

2 Thoughts on Is consolidating federal college loans a good idea?
  1. Reply
    golferwhoworks
    November 28, 2012 at 9:34 pm

    you have a 1 time shot at this. yes in most cases if you still send the $ 80 saved every month you can retire the same debt years sooner

  2. Reply
    Michael L
    November 28, 2012 at 10:14 pm

    there are a few things you have to weigh. Assuming that this consolidation is legit, many lure you in with good numbers but hide the up front fees. How long does it run for? Are you turning 7 year loans into 14 years loans to save $ 80 a month or under a $ 1000 a year?

    You don’t indicate whether or not you’re having problems meeting the current payments on a monthly basis. What will you do the extra $ 80 you have? Will you use it to leverage paying down what you owe, save it, or spend it?

    Rerun the numbers without the 2.8% loans in it, you really don’t want to refi those into a higher rate.

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