When you have several loans outstanding for the education that you have acquired, you can take part in student loan refinancing in order to get a much better interest rate so that you can lower your monthly payment. When you first got your student loans and had them deferred until you graduated, a lot could have changed in the interest market because you may have been in school for two to six years. Once you have graduated and you are out of school, the student loans will come knocking at your door to start your repayment plan.
Once this has occurred, you should definitely talk with the loan officer that is involved with your loan to see if student loan refinancing would be a good option for you. The interest rates could be much lower than the interest rate was when you first took out the loan so it would be very beneficial to you to start a process of refinancing due to the fact that you will have lower monthly payments and you will be able to pay off the loan sooner than you originally thought. Many students do this because it might take them a while to get a good paying job after they have graduated.
One important thing about student loan refinancing is you have to make sure that you refinance your loans separate if you have more than one loan. There are differences in the interest rates when it comes to federal loans and private loans. If you refinance them together, you might end up with a much higher interest rate due to the fact that private loans will assume you will have a higher paying job because of the extra education that you now have under your belt.
Federal student loans give much lower interest rates because of the way they are created and the student loan refinancing on these federal loans will give you a much lower monthly payment than that of a private loan. Once you have done the refinancing on your loans, then you could go for a consolidation loan which would benefit you even more because you will consolidate all of your student loans into one main loan with one low monthly payment and one low interest rate. You need to make sure that you have a good credit score before going for this type of consolidation loan in order to get the best interest rate you can.