Does loan consolidation reduce my interest rate and monthly payments on my student loans?

Yes, loan consolidation can reduce both the interest rate and monthly payments on your student loans. Loan consolidation is the process of combining multiple student loans into one new loan with a single monthly payment. By consolidating your loans, you can reduce the number of bills you have to pay each month and save money on interest. In Tennessee, loan consolidation is available to both federal and private student loan borrowers. Under the Federal Direct Loan Program, borrowers can combine loans, including Stafford loans, Perkins loans, and PLUS loans, into one new loan with a new interest rate. Typically, you will receive a lower interest rate on your consolidated loan than the weighted average of your existing loan interest rates. This can help you save money in the long run. You will also likely experience a decrease in your monthly payments when you consolidate your loans. This is because the repayment period is extended from the life of the loans you are replacing. For example, if your loans had a 10-year repayment period, a consolidation of those loans may give you a 15-year repayment period. That means the amount you have to pay each month is lower. In summary, loan consolidation can help you save money in both the long and short-term by reducing your interest rate and lowering your monthly payments. Before you consolidate, make sure you understand the terms and conditions of your new loan, and be aware of how much you will end up paying in interest.

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Does loan consolidation reduce my interest rate and monthly payments on my student loans?

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