First off, loan consolidation means merging qualified student loans into a single loan. This tends to ultimately make payments regarding these loans more affordable and much easier. This can lead to additional financial savings for the customer allowing them to control their financial circumstances better.
Various kinds of loans could meet the requirements for loan consolidation through ACS including federal unsubsidized and subsidized Stafford loans, federal PLUS loans, and federal direct loans, just to mention a few.
There are few specifications to make note of in order for borrowers to be eligible. The overall loans combined should have a minimum amount of $20,000. Borrowers will need to have a good record of being up-to-date with their repayments and none of the loans should be in default.
Only borrowers who've graduated and those under specific clauses meet the requirements and students currently enrolled aren't qualified.
Indebted students could gain countless advantages from this kind of debt consolidation. Various lenders including ACS may differ in some terms -- but generally offer the following things.
The borrower may acquire lengthier repayment period for their loans. The package offers several payment term options from 10 to 30 years. Monthly payments may also be fixed or varying - based on the borrower's personal finances.
There is just one required payment every month. Borrowers just have to write a single check to a single lender. What this means is less inconvenience because the paperwork is simplified.
There are no additional fees in applying for consolidation and no prepayment charges involved.
Finally, it allows the borrower to lock in on a lower fixed rate of interest for the life of the loan potentially reducing monthly payments by up to 50%.
Comparable to any other loan, there could be some potential drawbacks that may also be a consequence of loan consolidation. For instance a longer period for repayment and higher interest costs.
Due to the extended term of the loan, it may take a longer time to repay the loans altogether. For this reason, the accumulated interest cost over the life of the loan will lead to a higher amount.
However, as the economy continues to recover, borrowers really should investigate practical options such as the ACS student loans consolidation that will give them more overall flexibility in managing their money.