Fed Financial

I have almost $3000 in student loans all with Sallie Mae should I consolidate?

Like the title says, I have about $3000 in student loan debt some w/ Sallie Mae and then also AES. Is it wise to consolidate w/ Sallie Mae? I have horrible credit as I was out in 29 Palms doing USMC training and thought I was still in deferment but I wasn't and ound up being close to 4-5 months late on payments. There for I have HORRIBLE credit, I believe 480s last time I checked. I am trying to get my credit back under control so I need some help. What do you all recommend? I will be consolidating w/ Sallie Mae as well.

Public Comments

1. visit daveramsey.com to learn ur hard lessons from others bigger mistakes. NOW go out get pt/tm jobs delievering pizza newspaper and u'll pay them off in 4months. use a budget u'll have even more money.
2. Thank you for serving your country, and I'm sorry that your credit got into this situation while you were busy doing your duty. It is actually very common for military members to have this happen. It doesn't seem fair and I wish there was a special program to help soldiers avoid this credit difficulty that often occurs while they are moving around the country, doing training or are deployed. The good news is, Sallie Mae has a lot of options, check with them about their current requirements and offers. Some student loan consolidations require that you have been current on your recent loan payments. Other consolidations require that the debt be $7,500 or higher. Keep in mind that although consolidation can lower your monthly payments, from typical 10 year period up to as much as a 30 year period, it might also increase the total you will end up paying. The longer time you take to pay a loan, the more interest you pay over the extra years. By making smaller payments over a much longer time period, you could actually end up paying double the interest you would otherwise. Of course lower payments would help your budget right now, and then in a few years from now when you are making more money you could pay it all off early, and save the interest. There is usually no penalty at all for paying down loans ahead of schedule. Any prepayment goes towards the principal and that saves you interest over the life of the loan. It might help to talk to Sallie Mae about the possibility of another deferment. They have a page about it on their website. There is also something called Forbearance which is similar to deferment. In both cases it depends a lot on your particular situation, if you are going to be deployed soon, etc. The good news is, many people owe way more than $3,000 so that is a better amount to work on than what some people have. Best wishes.
3. I consolidated and I use AES with no problems. You can check in with other companies to see if they can offer you a better deal. Many of the companies will compete with each other so choose the one with the lowest interest rate.