more student loan questions...
I've done my research and have pretty much decided to consolidate with
Collegiate Funding Services, since they seem to be the most 'reputable'
program that offers a %1 discount after 36 months of on time payments. But I
am still curious about direct consolidation with the Department of Education
since, after doing some Google research, that seems to be the most
recommended consolidation option by this newsgroup. It seems as if the
primary benefit of consolidating with the government would be the Income
Contingent Repayment plan, which would allow you to make payments below
interest in cases of financial difficulty, whereas private consolidators
have only income sensitive payment plans where you still would have to keep
up with interest payments. Are there any other benefits to consolidating
with the federal government besides this plan? It seems as though the 1%
discount most private consolidators offer (which saves a few thousand $$ in
the long run) more than offsets the risk of future financial difficulties,
in which case the Income Contingent plan the fed offers would obviously be
the best option, at least in terms of keeping up with on-time payments...
I have a good job now (and parents who make decent money), so I am willing
to gamble that I will at least be able to make interest payments under an
income-sensitive plan (if it comes to that) through my private consolidator
for the next 20-25 years. But I am also seriously considering quitting my
job in a year or two to go back to grad school full-time for a master's or
p.h.d. If I do go back to grad school, that would re-open the risk of not
being able to find a good job once I get my degree, in which case I would
want to fall back on the federal government's ICR plan until I find a decent
job.
I guess what I'm asking is, would it be worth forgoing the eventual 1%
interest deduction private consolidators offer(which, for my $34,600 in
loans over a 20-year period I'm assuming will save me a few thousand dollars
over the long run) to consolidate with the government, who offer a better
plan in the case of extreme financial difficulty? Are there any other major
benefits/disadvantages to consolidating with the government (or any other
major benefits/disadvantages to consolidating with a private lender)?
CFS does have a good program but there is better. I work for MHEAC,
Mississippi Higher Education Assistance Corporation. We offer 1.25
reduction after 36 on time payments and .25 reduction immediately for
bank draft repayment. The only thing is with us is that you have to
meet at least 1 of these requirements:
1. Must be a Mississippi resident
2. Loans originated in Mississippi
3. Went to school in Mississippi
If you meet any of these, we would be glad to help you out. If you
went back to school it wouldn't count against you with us, as long as
you were in some type of forbearance or deferment. If you are
delinquent it would lose your eligibility.