This is especially true if you have a bad credit score.
Student loans can fund your education, but things don’t always work out when it’s time to repay those loans.
So what happens if you stop making payments – do lenders give you extra time to pay, or do they garnish your wages to collect on student loans?
Another perk about the direct loan consolidation is that it actually improves your credit score.
When you consolidate your student loans, a number of factors are modified in your finances.
Ultimately, if you have good or bad credit and are thinking about consolidating your student loans, it will depend upon the type of loans that you have.
For Federal Loans, consolidation is usually a great idea, but for private loans it gets more tricky and it is important to be careful who you do business with.
Most of these changes will cause creditors to look more favorably upon you.
One factor that determines your credit score is the number of lines of credit that you have open. By consolidating your student loans, you replace your many student loans with one new loan.
, and once a private loan is put with a federal loan, all of the federal loans loose their benefits. Consolidating your private student loans is no easy task with a bad credit score. The one conceivable exception would be if you were to get someone to cosign on your consolidated student loans.