Federal Student Loan Consolidation

  Update from Patrick Kandianis, co-founder of SimpleTuition, May 2, 2008

Unfortunately, we are unable to show you a comparison of federal consolidation loan offers at this time. Over the past year the student loan market has seen unprecedented changes. The changes made to the structure of the student loan programs that are guaranteed by the federal government (but that are actually issued by banks and private lenders) have forced many lenders to discontinue offering incentives or benefits to consumers and in many areas, to discontinue offering new student loans altogether. Federal consolidation loans have been especially hard hit. In general, these loans can be unprofitable for individual banks to issue under the new regulations. As a result, we have no lender offers available for comparison at this time. You still have options, however:

• Contact your current lender(s) about restructuring the repayment on your existing loan(s). Federal student loan repayment can be extended and modified in ways to help you attain a more manageable monthly payment.
• Obtain a federal consolidation loan from the Department of Education's Direct Loan Program. The interest rate on a federal consolidation loan is fixed, and the length of a federal consolidation loan can be extended up to 30 years which can also help lower the amount of your monthly payments.

If market conditions change and lenders restart their federal consolidation loan programs, we will reactivate our comparison marketplace.

Private Student Loan Consolidation

SimpleTuition has partnered with Wells Fargo to offer our users a private consolidation loan option. Learn more about this option. Other lenders may also offer this service.

Consolidation of private student loans is a relatively new option, and many lenders are still fine-tuning offerings. Make sure to do your homework before consolidating your private student loans - be aware of prepayment penalties and monthly payment rates that start out attractively low but increase over time.