Help Consolidating College Loans

RobAnybody

Hello all,
I am a long-time lurker of these forums, and I have great faith in the quality of advice that lies here. Hell, I have gotten help on my own life issues simply by reading responses to someone else's problem. But enough of that. My issue is college loans, and they aren't even my own.

My girlfriend and I live together. She has about $45,000 in loans from college. I have none, thanks to my folks and my scholarships. She is in the process of finding a way to consolidate them so they can be manageable. This is pretty darn stressful, since $45,000 is a lot of money and while we both have full time jobs, we don't make tons. These are federal loans, and she has a grace period through deferment until February. If you need more specifics, I would be happy to supply them.

Anyway, any advice anyone has on ways to consolidate this debt effectively and get on a payment plan that won't cripple us, nor will it have us paying off a buttload of interest over the years, would be most appreciated. Thank you much in advance.

Uncle Long

Check with the lender. Mine was Great Lakes. They were federal loans through Great Lakes. Request that your federal loans be consolidated and they will send you the forms or have a way to do it on line.

I just did this last month.

RobAnybody

I think she already tried this avenue. Her loan was with Citi Bank, so I am not sure if they will be particularly friendly. Then again, I know jack about banks in general and which ones are good to go with.

But is there any way to deal with the original lender so that you can have a measure of control over the monthly payments? Or do you have to bend over and take it regardless of what they offer as a consolidation?

Uncle Long

I also had a loan with citibank. Not a federal loan but a citiassist loan. Same story. I went through their web page.

What original lender are you talking about? The US Government?

Also, look into the plans they have there. Graduated payment plan will cut your payments about in half for the first 60 payments and put them back up to what you would normally be paying for the next 120.

RobAnybody

The original lender I was referring to was just Citi Bank. I was curious if some third-party group would be better to deal with than the bank itself.

A small question on the Graduated Payment Plan: will that choice leave us with a larger portion of interest to pay? Or will it pretty much balance itself out with the larger payments later.

And thanks for this info. We have both been kinda in the dark about what to really do, and we don't want to let the grace period go and get reemed.

Uncle Long

You're going to pay more, yes, but not substantially. Usually the interest rate is lower so that extra five years is going to pretty close to even things out. Of course the idea is that in 60 months you should be making substantially more and be relatively settled financially.

Think of it like this: if you plan to lessen the amount you're paying, then you're going to have to extend the length of the repayment period. Now, you could stretch it out to thirty years, but all the while you're going to be paying interest.

Lower payments now = more paid total.

RobAnybody

Awesome. Thank you very much for the advice.