Cost of consolidating student loans

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Choosing one could make your payments much more affordable.

Any remaining debt after 20 or 25 years of on-time payments toward an income-driven plan will be forgiven, though you'll pay tax on that amount.

You can apply for a federal direct consolidation loan for free online through the U. Your credit scores, income and other financial factors are not used to determine your eligibility, and you don't need a cosigner.In either case, you'll end up with a single loan payment, which can streamline your bills if there are several creditors billing you for separate loans each month.One payment could make you more likely to pay on time, which is the biggest factor in maintaining a strong credit score.Refinancing and consolidation are two ways to bundle multiple student loan payments into one—and in the case of refinancing, potentially save money on interest.Whether to go for one of these options, though, depends on the type of loans you have and how much you stand to save.

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