Does consolidating your student loans help your credit

WARNING: It is very dangerous to consolidate federal loans into a private consolidation loan.

You will lose your rights under the federal loan programs once you choose to consolidate with a private lender.

APPLYING FOR DIRECT LOAN CONSOLIDATION The Department generally requires all borrowers to apply for Direct Loan consolidation using the web site. It is very important to review this sheet and check to make sure all of the loans you wanted to consolidate are included in the new consolidation loan.

(Click espanol to find a Spanish version of the on-line application). Be sure to meet the deadline for responding if you think there are problems with the consolidation or if you have decided you do not want to go forward.

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You may consolidate with Direct Loans during grace periods, once you have entered repayment, or during periods of deferment or forbearance.This may be a good idea if you want a single monthly payment.You may also be able to get a better deal if, for example, your credit score is better now than it was when you first took out the private loans.These circumstances are: Borrowers cannot consolidate private student loans with the federal consolidation loan programs.However, if you have private loans, you may want to think about consolidating these loans into a new private consolidation loan.

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