College graduates are blessed with having had the opportunity to receive higher education. In fact, only a small percentage of the world’s population even has the chance to attend college.
And yet, grads know that their degree was not handed to them. They had to work hard to earn it. After all, a college degree is not just given to a person for warming a seat in class for 4 years. Rather, it is earned by countless hours of focus, study and attention on a particular course of study.
In addition, grads have another challenge beyond having to study, which is that they have to find a way to pay for their tuition, books and living expenses. Of course, there are those fortunate ones who qualified for scholarships or received money from their parents to get them through school. But the vast majority of grads had to take out loans. And, that student loan debt stays with them for years to come.
Students who hold more than one student loan have things just a bit tougher still. Having multiple loans means having to make different payments each month on different dates. And those loans are usually locked in at different interest rates.
Reasons To Consolidate Your Loans
Many college graduates who have multiple loans choose to consolidate their loans into a single loan. The main reason to do so is that it can lower their monthly loan payments by stretching that debt out over more years.
Another reason that grads consolidate is because they want to simplify their finances by just having to make a single monthly payment at a certain interest rate.
Moreover, student loan consolidation results in the borrower paying a lower interest rate in many cases. That is because, under private loan consolidation, the interest rate of the new loan is based in part upon the borrower’s credit score.
Parent-Student Loan Consolidation
The fact that the interest rate for private student loan consolidation is based in part upon the borrower’s credit score means that parents with good credit can co-sign a student loan to bring the interest rate down. Parent-student consolidation means that both the parent and student are liable for paying back the loan.
Tips For Parents Co-Signing A Student Loan Consolidation
Here are 3 tips for a parent co-signing on a consolidation loan:
1. Start by researching multiple private consolidation lenders: Student loan companies offer different terms and different interest rates to the same applicant. It is always a good idea to hedge your bets and apply to multiple lenders. So, start by locating and researching at least 5 lenders.
2. Both parent and student should co-sign the loan during the application process: When submitting an application online or through the mail, be sure that both parent and student co-sign in order to lock in the best offer.
3. Select the offer with the best rate: Of course, with multiple offers on the table, you will be eligible for the best-possible interest rate.