Effective Student Loan Consolidation Programs That Can Alleviate Student Debt

For everyone, regardless of their situation, there is a need to take control of debts. For students who have just graduated after four or five years in college, the reality of finally having to repay often numerous loans can cause panic. But the availability of student loan consolidation programs means there is a way to take control of this mammoth debt.By securing student refinancing deals, recent graduates can actually reduce the debt they face, as well as make the task of repaying what might be hundreds of thousands of dollars in a more manageable way.But there are two forms of these programs available; the private and the public. Both can help in the repayments of student loans but which one is best to choose depends on the specific situation that the graduate faces.Features of Private ProgramsThe fact that the majority of college loans taken out by students are from private lenders means many of these same lenders offer student loan consolidation programs. After all, they are more than willing to secure more business while also seeing their existing loans fully repaid. In many ways, these are the best choice for graduates.A key feature of the private program is the reduced monthly repayments, with the individual payments of four or five loans replaced by one simply payment. Of course, this is a central motivating factor when securing student refinancing deals, and is the one that principally provides the breathing space.Lower interest rates is also an important feature, with the very act to buying out the numerous student loans meaning that these loans are marked as repaid in full, which in turn causes the credit score to improve.Finally, most programs include no prepayment penalties, which means that a sudden financial improvement can see the graduate repay their loan ahead of schedule without punishment.Features of Public ProgramsOffered by the federal government, turning to publicly sponsored student loan consolidation programs can see the overall debt reduced and made much more manageable to clear. The principals are similar to private programs, with existing debts consolidated into one sum, while interest rates are much lower.However, because these programs are supported by the federal government, the specific terms are much better than those available through the private alternative. In fact, as securing student refinancing agreements go, this form is difficult to beat. The interest rates charged are the lowest available, while the repayment schedule is typically extended to ensure lower repayment sums.There are a number to choose from, not least the Federal Family Education Loan. By using these programs to combine the outstanding student loans, the loan default rate amongst graduates has been drastically reduced.Complicated Debt SituationsThe good news for all graduates is that the source of college loans has little to do with the structure of student loan consolidation programs. What this means is that even if a graduate has taken out a mixture of loans from both private and public sources, there is little problem in getting a program.This means that rather than securing student refinancing deals from a completely new lender, it is often a better idea to agree a deal with one of the existing lenders. The advantage is that these lenders already know the borrower, are in a better position to offer lower interest rates and are usually only too happy to increase their business.After graduation, and once employment has been secured, the repayment of student loans must begin. But a consolidation program means this huge responsibility has become more manageable, can save money and lead to a brighter financial future.