Consolidating private student loan fixed rate
When you apply for loan refinancing with a private lender, the private lender is essentially consolidating and refinancing your student loans.
Whereas when you consolidate your federal loans with a Direct Consolidation Loan, this only combines your federal loans together without reducing your interest payment.
This figure does not even look at the student loans parents took out to help their child’s college costs. It is common for graduates to find themselves in a financial hard place when it comes to repaying their loans.
Dropping a cosigner, which is typically your parent or another close family member, releases any extra tension in your relationship.
Cosigning for a student loan is a massive undertaking and comes with high risks.
Another way a refinancing saves you money is because it can extend the duration of your loan.
If you choose to refinance your 10-year student loan into a 20-year loan, you will see a dramatic cut in your monthly payments.