Taking a student loan may seem to be the most logical and easiest option when you are in college, however, when you have finished your studies and start working, the repayment of the student loan or loans can be quite a hassle.
Why would you want to refinance or consolidate your student loans?
When you are in college, you do not think much of the repayment of student loans. This is because the lender, will give you a grace period to start paying it back which in most cases are when you start working.
However, when you start working, there will be other expenses that you have to take care of as well. When this happens, the burden of student loans can weigh you down and be a headache.
Consolidation and Refinancing
When you have multiple student loans, there will be many payments that have to be taken care of on a monthly basis. It is easy to lose track of the payments. However, if you have one payment to make, you know exactly the situation you are in as far as your debt is concerned. Have a look at the SoFi options available to make this easier. Consolidation of these loans may also allow you to make use of better interest rates and easier repayment plans so that you do not stress over falling back on the payments.
Many people are stuck with student loans
In the US, there are many people who bear the burden of student loans and end up not being able to make payments. The topic has become one of major concern due to the shortage of jobs and lower income. If however, you decide to refinance, you will effectively get a fresh start on your loan and better interest rates.
Protect your credit score
When you fall back on loan repayments, your credit score can suffer. However, refinancing or consolidating them will ensure your credit score remains intact in case you need any credit facilities in the future.
You should not allow these loans to get out of hand and service them regularly. However, if you find yourself falling back and unable to make payments on time, refinance them so that it will appear as a new loan on your credit history.