Consolidation Loans are available to most borrowers of Federal education loans and come from one of two sources: Direct Consolidation Loans are made by the U.S. Department of Education. You repay a Federal Consolidation Loan to the U.S. Department of Education. Federal Consolidation Loans are made through Federal Family Education Loan (FFEL) Program. While FFEL funds come from private lenders, such as banks and credit unions, they are subsidized and supported by the U.S. Department of Education. You repay a FFEL Consolidation Loan to the private lender that made the loan or to its designated agency. Whether you receive a Direct or FFEL Consolidation Loan depends on which program you choose. In either case the terms of the loan (loan amounts, interest rate, and other benefits) are generally the same. General Program Requirements Most Federal student loans are eligible for consolidation, including subsidized and unsubsidized Direct and Federal Family Education (FFEL) Stafford Loans, Direct and FFEL PLUS Loans (parent loans), Federal Perkins Loans, Federal Nursing Loans, and Health Education Assistance Loans. Private educational loans are not eligible. You can get an FFEL Consolidation Loan during your grace period, once you have entered repayment, or during periods of deferment or forbearance. Direct Consolidation Loans are also available when you are still in school. Borrowers who are in default must meet certain requirements before they may consolidate their loans.

PLUS Loans come from one of two sources: Direct PLUS Loans are made by the U.S. Department of Education. You repay a Direct PLUS Loan to the U.S. Department of Education. Federal PLUS Loans are made through Federal Family Education Loan (FFEL) Program. While FFEL funds come from private lenders, such as banks and credit unions, they are subsidized and supported by the U.S. Department of Education. You repay a FFEL PLUS Loan to the private lender that made the loan or to its designated agency. Whether you receive a Direct or FFEL PLUS Loan depends on the program in which your school participates. In either case the terms of the loan (loan amounts, interest rate, and other benefits) are generally the same. The school applies PLUS loan funds toward your child's educational costs such as tuition, fees, and room and board. If any loan funds remain after school charges are paid, you will receive the remaining amount from the school, unless you authorized the school to release the funds to your child. Any funds you or your child receives must be used to pay the child's educational expenses.

Federal Perkins Loans help financially needy undergraduate students and graduate students meet the cost of postsecondary education. The award is made by the school based on the availability of funds. A Federal Perkins Loans carries a fixed interest rate (currently 5 percent) and must be repaid beginning after a nine-month grace period following the date when the student is no longer enrolled on at least a half-time basis.

Stafford Loans are available for undergraduate and graduate students and come from one of two sources: Direct Stafford Loans are made by the U.S. Department of Education. You repay a Federal Direct Stafford Loan to the U.S. Department of Education. Federal Stafford Loans are made through Federal Family Education Loan (FFEL) Program. While FFEL funds come from private lenders, such as banks and credit unions, they are subsidized and supported by the U.S. Department of Education. You repay a FFEL Stafford Loan to the private lender that made the loan or to its designated agency. Whether you receive a Direct or FFEL Stafford Loan depends on the program in which your school participates. In either case the terms of the loan (loan amounts, interest rate, and other benefits) are generally the same.

So, you just finished college and you are getting all types of things in the mail telling you that you need to consolidate your student loans. Should you go ahead and consolidate or not? What are the advantages and the disadvantages? Here is all the information you need in order to make a decision about student loan debt consolidation.

Federal Student Loan is the most common college student loan. There are mainly two kinds of federal student loans i.e. subsidized and unsubsidized. Subsidized college student loan: Government pays the interest whilst the student is attending the college.

It can be confusing when you need to apply for student loans but it does not have to be. A student loan is just money you borrow that you have to pay back with interest. The sum you borrow is the principal. Interest is a percentage of the principal you pay for borrowing. You pay back the interest and principal monthly. If you do not pay, you face government penalties. To apply for student loans you need to fill out an FAFSA form. You will need information from your federal tax return. Some schools may require you to fill out additional forms. You will have to check with your particular school. You will be notified if you qualify.

Even if a student has made payment mistakes in the past, a new loan is available in the loan market with some conditions. Bad credit of a student is no longer seen as a hurdle in the way of providing loans for collage studies. This can be an option for the students of the UK who have late payments, arrears, defaults etc in their names.

College is expensive, and many students use financial aid to pay for tuition, books, and other education-related expenses. Student loans are the most common type of financial aid. With so many loan programs available, there is more than one way to find money for school. Whether you have good credit or bad credit, banks, credit unions, and Federal loan programs offer packages to fit every need. Of course, if you want to maximum your loan choices, a good credit history is imperative. While bad credit will not disqualify a student loan applicant, bad credit student loans come with steep penalties and higher rates.