First things first you need to contact your lender and fill out the appropriate applications. Many times this can be done online now or even over the phone.
The lender will now contact your lending agencies and request amounts owed. Once they compile this data, they will notify you of the amount owed, paperwork/documents that need to be filled out, disclosures and repayment terms.
The good thing about direct loan consolidation is that you will get a fixed interest rate. This rate is determined by averaging your previous loans. This can be a good thing if you were caught with some high rate loans and a low rate loan. They will use the lower rated average to determine the new rate.
Private educational loans are typically not eligible for consolidation. Most all federal loans are. These include the PLUS Loans, Stafford, SLS, Federal Perkins, Health Education assistance, Federal Nursing Loans, FFEL subsidized and unsubsidized and more.
There are a few rules. All Direct Stafford and FFEL are eligible to consolidate after they graduate or fall below half-time Enrolment or leave school.
Once fully disbursed, the PLUS loans are eligible for consolidation. If the PLUS loan was made by a parent for the dependent, then the dependent would not be able to include it in a direct loan consolidation.
All borrowers who are behind in their loans must get up to date or meet certain qualification in order to qualify for the consolidation. You will need to contact your lender for more information.
Borrowers, in order to qualify for a direct loan consolidation must have at least one FFEL or direct federal type loan.
There are more rules depending on the type of loans you have, length you’ve had them, status of those loans, etc. Your particular circumstances must be evaluated by the lender.
Interest rates, like I stated above are going to be calculated on an average basis. Payback begins within 60 days of disbursement. The terms can range from 10 to 30 years.
For more information on a direct loan consolidation programs, qualifications, contacts, please go here: http://www.thestudentloans.org/category/directloanconsolidation
