<p>I'm graduating later this month, meaning my loans will go into repayment as of this November. I'm starting to consider budgeting and repayment plans, and -- naturally -- consolidation has come up. I see that this topic has been posted about before, but I'm going to try it again a little more generally.</p>
<p>What are the governing factors when determining whether to consolidate your loans? Is it the weighted average of your percentage rate? The overall amount of debt? Your anticipated pay off period? </p>
<p>In my case, I have about $30,000 in loans in 12 different packets. Most of them (~$21k, ~8 packets) are US Dept. of Ed. subsidized and unsubsidized loans. The rest are made up of Perkins, private and non-USDoE unsubsidized Stafford loans. I've surveyed consolidating all of these loans, and it should give me ~6.125% interest and projects a monthly fee that I can more or less pay 2x per month (given a conservative income estimate compared to my cost of living). </p>
<p>Is it better to keep certain loans separate (those that are very low interest, or those that are very high interest, or...?), or just to consolidate them all and make lump payments? </p>
<p>I've paid a lot of attention to everything in this college process, but I'm a little lost when it comes to the final finances. Help is appreciated!</p>
<p>I believe the current wisdom from FA people is not to consolidate federal loans with a private consolidation loan package as you lose the benefits those loans offer (discharge upon death, etc.) and, if possible, also not to consolidate Perkins loans, which have the best terms. There’s alot of info on these two sites about consolidations:
[FinAid</a> | Loans | Student Loan Consolidation](<a href=“Your Guide for College Financial Aid - Finaid”>Student Loan Consolidation - Finaid)
[Student</a> Loan Borrower Assistance Consolidation Loans](<a href=“http://www.studentloanborrowerassistance.org/understand-loans/consolidation-loans/#Loan%20Terms,%20Fees,%20and%20Limits]Student”>http://www.studentloanborrowerassistance.org/understand-loans/consolidation-loans/#Loan%20Terms,%20Fees,%20and%20Limits)</p>
<p>So if you have to consolidate, it’s better to take your fafsa loans into a federal consolidation loan package and keep the benefits of those loans. I know that federal loans don’t pass on to your family after death and there are loan forgivness options.
My nephew, before he came into some money, consolidated and although the interest would be more, breathed easier that he could afford the monthly payments and paid more when he could.
I saw on the news in Canada how the loan companies were hounding parents of a young man who died about his loan payments…a horrible thought to begin with, but then to have the harassment, was adding to their misery. The commentator said, at least in the US, we haven’t dropped to that level with our federal loans. He couldn’t say much more.</p>