Canadian Student Loan Consolidation
Rising college costs in recent years have led to a large number of students seeking alternate sources for funding. A large number of students use student loans to finance their education and student loans are preferred over other types of aid as they have flexible borrowing limits and can be used to cover all of the costs incurred at college. Many students borrow more than one loan in order to meet all of their needs. While student loans are a quick and convenient way to cover most education-related expenses, they carry a markup interest rate and have to be paid back in full.
When it comes to repaying a student loan, consolidation is an excellent option. Simply put, consolidation means combining all loan repayments and rates into one repayment plan. There are basically two types of consolidation: federal and private. Both have different conditions and eligibility requirements, application procedures and repayment plans.
If you are a Canadian national and want to study in the United States, then you can use a student loan to finance your education. There are several financing options you can apply for, such as the Canadian Higher Education Loan Program (Can HELP). In some cases, one loan may not be sufficient to cover all of your educational expenses, so if you have borrowed multiple loans, then consolidation may make the repayment process much easier.
Student loan consolidation has a number of benefits, the most important of which is a lower rate of interest as compared to original rates. All the interest rates on your student loans are combined and averaged in a new weighted rate and the weighted rate is then rounded off to the nearest eighth of a percent to obtain the new interest rate, which can significantly lower the total amount you owe. Another benefit of consolidation is that the repayment schedules for all the loans are combined into a single extended schedule. Lower rates of interest and longer payment period mean lower monthly payments for you. Additionally, consolidation also allows for all loan payments to be combined into one installment each month, making it easier to keep track of your finances.