Refinance Student Loans


Refinance student loans as soon as possible to avoid missing the chance at record low interest rates. According to recent financial projections, future interest rates on refinancing or consolidating student loans will become much more costly as of July 1, 2006. This is not the time to procrastinate as time is quite rapidly running out. Some project an increase to approximately twelve percent over the course of the months following July. Refinancing student loans has the most usually positive effect of reducing your monthly student loan payments by spreading them out over as much as thirty years. There are many different methods of accomplishing this. Most lending institutions have student loan consolidation programs.

Refinancing student loans begins with making sure that your credit history is in good standing with your lending institution as your interest rate will be based on it. Although they can be had with bad credit, the interest rate will be substantially higher. Before July with a solidly good credit report you could refinance at as low a rate as two and three quarter's points. These interest rates vary by lending institution and so you need to be sure to shop around carefully for the best deal and not just settle for the first loan you find.

Refinancing student loans is not always the best course of action so think hard about your situation before committing to a consolidation plan. For instance, should you be near the end of your current loan term you may well just simply add far too much interest defeating the purpose of saving money. Also, if you would have ready cash available to you the best plan would be eradicating the loan completely and freeing yourself from it in one finishing step.

Refinancing student loans is often sought during a time of financial need, such as starting a new business or buying your first home. The need for lowering monthly expenses at those times is essential. After all, the lower your monthly expenses the more attractive you are to a potential lender. Refinancing student loans through a federally funded program rather then a private lending institution is most likely your best choice as the interest rates are far lower then with a private loan. Take a look at how much money you have outstanding, unless it is seven thousand five hundred dollars or more it will most likely not be considered as able to be consolidated.


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