Consolidating government subsidized student loans

As you can see from the fact that there are both pros and cons, the question of whether to consolidate is not necessarily simple.

There are a lot of ramifications and wrinkles to consider, including the fact that student loans are generally not dischargeable in bankruptcy—so if you replace several smaller loans with one large one, you’re taking on a large obligation that you can’t get out from under other than by paying it off.

Subsidized loans are a sought after product offering by many people especially the middle income earners.

A government debt consolidation loan is a loan given by a government program or agency in order to help a person pay off debts he or she owes to multiple institutions simultaneously.

These are just a few of the issues to keep in mind when students, or former students, are contemplating consolidation.

Federal student loan borrowers have the option of consolidating their loans via the Direct Consolidation Loan program offered by the U. That loan is then serviced by the servicer of your choosing – of which Nelnet is one!

The consolidator then issues a new loan for the same amount with a secure interest rate.

This basically means that the rate isn’t going to change unless the borrower fails to make payments or otherwise defaults.

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People often like this sort of structure because of its convenience.

They can make just one payment instead of many, and they don’t have to keep track of multiple due dates.

When a person signs up for this type of loan, a government agency or consolidation company pays off the debt in full to all of the collectors.

You have the option to select the servicer of your choice (of which, Nelnet is an option) After your new Direct Consolidation Loan is complete, you may still add more eligible loans to your existing consolidation.

If you would like to add other eligible loans, your servicer must receive your Request to Add Loans Form within 180 days from the date your Direct Consolidation Loan is completed (originated).

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