Are there any additional benefits that I receive if I consolidate while I am in grace?
When you are in your grace period (the six months immediately following graduation), the interest rate on your variable rate Stafford loans are 0.60% less then what they would be if they were in repayment. By consolidating while you are in grace, the Educational Loan Company will you this smaller interest rate it the calculation formula for you new fixed rate. This can save you thousands of dollars of interest over the course of repaying your loan debt.
Can I postpone my first payment until my grace period expires?
Yes, the Educational Loan Company can fund your loan at the end of your grace period there by lowering your new fixed interest rate at the same time maximizing the time period in which you will not need to make any payments.
What if I don’t know much about what I owe?
Don’t worry. This happens quite often. You can access the U.S. Department of Education’s NSLDS (National Student Loan Data System) online at www.nslds.ed.gov. Here you will be able to get a print out of all of your outstanding federal student loan information by utilizing your social security number, date of birth, and PIN (Personal Identification Number). If you don’t remember your PIN, you can retrieve it or create a new one. If you have a HPSL (Health Professions Student Loan) or a HEAL (Higher Education Assistance Loan) loan, you will need to contact your school’s Financial Aid Office. This information is not available on the NSLDS.
Are there any fees associated with this program?
There are no fees whatsoever. This is a free federal program designed to assist you in repaying your federal student loan debt obligation. You are simply taking your federal debt from one or two federal programs and transferring it to a third.
Is there a credit check required for this loan?
There are no credit checks required. You are eligible for federal consolidation if you have at least one outstanding federal loan (not previously consolidated).
How long does this process take?
The consolidation process takes approximately 4 – 6 weeks to complete. The majority of this time is consumed communicating with your current lender(s) for the purpose of obtaining exact payoff information. It is extremely important that you continue making payments, if applicable, with your current lender(s) until your are notified vial mail that your consolidation is complete.
What loans can I consolidate?
You can consolidate any federal student loan. These include Stafford, Perkins, Consolidation, PLUS (Parent Loan for Undergraduate Students), Graduate PLUS, HPSL (Health Professions Student Loan), NDSL (National Direct/Defense Student Loan), FISL (Federal Insured Student Loan), LDS (Loans for Disadvantaged Students), SLS (Supplemental Loans for Students), and HEAL (Higher Education Assistance Loan) loans.
Why can’t I include any private loans or credit card debt?
The U.S. Department of Education insures all federal student loan debt. It does not insure any private or credit card debt. Therefore, it will only allow the consolidation of federal student loans into the federal consolidation loan program.
How does this program lower my monthly payment?
Currently, most of your loans are set up on a ten year repayment term. When you consolidate, you will receive a longer repayment term of up to 30 years in length depending on your overall student loan indebtedness. By having to repay the same amount of debt off over a longer period of time, you receive a smaller monthly payment obligation.
Are there any prepayment penalties?
There are no prepayment penalties. As with any federal student loan, you can pay off your federal consolidation loan as fast as you want. Any dollar you pay over the minimum monthly payment will go directly to the principal of the loan, assuming that you don’t have any unpaid late fees or accrued interest.
Should I consolidation all of my federal student loans?
It depends. Some federal loans have loan forgiveness features. For example, if you have a Perkins loan and you are a teacher working in a rural or underdeveloped area, you may be eligible to have some or all of your Perkins loan debt forgiven. Contact one of our customer service representatives for more information.
Can I choose what type of payment plan I receive?
You will be able to select from a multiple choice of repayment options. Two of the most popular repayment plans are the “standard” and “graduated” repayment plans. On the level (standard) repayment plan, you will have one payment for the entire time you have the loan. A graduated repayment plan, on the other hand, will allow you the opportunity of starting with a much smaller payment initially. Your monthly payment will go up over time.
Are there forbearance and deferment options available?
As with any federal loan program, there are a multitude of forbearance and deferment options at your disposal. From being in-school on a half time or greater basis, in residency, or unemployed, there are several safe guards built into the federal consolidation loan program to assist you.
If I have already consolidated, can I consolidate again?
You may consolidate as many times as you like so long as you have at least one federal loan that you have not previously consolidated. You may also consolidate two or more consolidation loans (with different disbursement dates).
Are there any disadvantages to consolidating my loans?
There are two possible disadvantages when it comes to consolidating your loans. First, if you consolidate a Perkins loan, you will lose its subsidization feature and may lose certain loan forgiveness clauses that go with it. Contact one of our representatives for more information. Second, by receiving a longer repayment period, you may end up paying more interest over the life of the loan. However, if you take your monthly savings and apply them towards more expensive debts like credit cards and car loans, you will come out ahead financially.
Are you a part of the federal government?
The Educational Loan Company is not part of the federal government. The Educational Loan Company is a private organization that is authorized to fund and originate federal student loans that are guaranteed by the U.S. Department of Education. Educational Loan Company’s Federal Lender Identification Number is 834003.
