Wells Fargo Student Loan Consolidation
Seven out of 10 college students graduated with an average student loan debt of $28,400 in 2012, according to the Project on Student Debt. Many students even have more than one loan in order to afford the rising costs of higher education. Students do what they can to get by, and then once they leave school and enter their repayment period, struggles with managing payments can become unbearable. One option to consider is loan consolidation. This means that you will merge all your existing loans into one loan, potentially with a new lender and new loan terms. Wells Fargo is a private financial institution that offers the Wells Fargo Private Consolidation (SM) Loan to eligible students.
Pros and Cons of a Consolidation Loan
If you have trouble keeping track of multiple loan payments, or have loans with high or ballooning variable interest rates, loan consolidation may be the answer. You should consider the interest rates of your current loans in comparison with a consolidation loan in order to determine if it can actually save you money over time. A consolidation loan may offer you lower monthly payments, although you should keep in mind that lowering your payments may extend the life of your loan, thus increasing the total amount of interest you will pay over time. Also by consolidating your existing loans, you may lose some benefits or certain repayment options.
Federal student loans can only be consolidated through the federal government via a Direct Consolidation Loan, while private student loans from any lender can be consolidated in a Wells Fargo Private Consolidation Loan.
Wells Fargo Private Consolidation Loan Details
Consolidation loans take between 45 and 60 days to process, and you should continue making payments on your current loans until you receive notification from Wells Fargo that the debt has been resolved and merged into a new consolidation loan. Wells Fargo Private Consolidation Loans have no origination fees and competitive fixed or variable interest rates. For current rates, check their website. You are entitled to a maximum loan amount of $120,00 for this loan, with a lifetime maximum amount of $250,00 for this loan in combination with all other education-related debt. Wells Fargo offers interest rate deductions of 0.25 percent each if you are a Wells Fargo customer and/or if you enroll in automatic payments.
How to Apply
To apply for a Wells Fargo Private Consolidation Loan, you will need the following information for each of your student loans:
- Name and address of your lender
- Account number
- Current monthly payment information
- Outstanding balance amount
- Current interest rate along with the type of rate you have (e.g., fixed or variable)
You will also need to provide your Social Security number, a personal reference, income information, home and school addresses, telephone number(s), gross income information, information on your residence, and your requested loan amount. You can apply online.
Consolidation loans, like regular private loans, are based on a credit check, and sometimes you may need a cosigner in order to qualify. A co-signer is financially liable for you and your loan in the event of nonpayment, and often the use of a credit-worthy co-signer can qualify you for better loan terms and rates. A consolidation loan can greatly simplify your student loan payments after you have left school, but be sure to do your research to determine if it is the right choice for your personal situation.