Today, the cost of higher education is increasingly expensive. Some families may not be able to afford to send their son or daughter for further education. Getting a student loan will help.

There are two broad categories of student loans available. Government student loans and private student loans

Government or federal student loans are funded and administered by the US Department of Education and are classified in the Federal Student Loan Assistance Program. They have very few requirements other than studying at a US college or university International students can also apply, although approval is on a case-by-case basis.

Each year, the student loan assistance program disburses about $ 60 billion, making it a good option for obtaining a student loan from the government. Therefore, the interest rates are quite low.

Private student loans are financed and administered by banks and other financial institutions. These lenders offer student loans at a higher interest rate compared to federal student loans. Some common student loans available are from Citibank and Sallie Mae

You are allowed to apply for both private and federal student loans for your educational needs, although I would not recommend it.

For some students who have a few student loans to pay off at the same time, it can be a financial strain on their family finances. That’s where student loan consolidation comes in.

Student loan consolidation basically consolidates all of your student loans into one loan to make it easier to manage and make payments. When you obtain a student loan consolidation, either from the government or the private market, the student loan consolidation lender pays and clears your existing student loans. Balances carry over to the new student loan consolidation. Therefore, you start a new loan and you only need to make a one-time payment each month.

There are many advantages to using student loan consolidation. The interest rates will be lower since you take the average interest rates of your previous student loans. Therefore, due to government legislation, the maximum interest rate cannot be higher than 8.25 percent.

It becomes much easier to manage a single student loan and repayment is easier. The payment options are quite flexible. For federal student loan consolidation, you can choose to start paying after you graduate from school. There are also several other options.

Another beneficial side effect of student loan consolidation is that it can also improve your credit score. Since you are effectively paying off all of your old student loans and taking out a new one, your credit score will increase and it is important if you plan to take out other types of loans in the future.