Low interest rates for consolidating student loans

Over the life of the loan, the savings can be thousands of dollars.

But that doesn’t mean consolidation is always a smart move.If they turn you down, get the lender to document the reason.If you can mitigate the reason -- say by making another year's worth of on-time payments -- you can then go back to the lender and ask again a year from now. If you cannot get an interest rate reduction, pay down your loan early by making additional principal payments.By combining your interest rates, you also lose the ability to employ a favorite tactic of financial planners for paying down debt: targeting the most expensive debt, the loan with the highest interest rate, first.What’s more, consolidation typically results in the borrower paying more in total interest because consolidated loans are generally stretched out over a longer period, says Jessica Ferastoaru, a student loan counselor with Take Charge America. Consolidation usually gives you more repayment options, but it can limit them too.

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