Student loans are a growing type of debt for adults across the country. With education expenses seemingly always on the rise and a competitive job market that requires unique training or degrees for many position, more and more people are coming out of their early twenties with debt from student loans. Those loans can plague individuals for decades, but there are options for student loan debt relief.
One way to get some relief from student loan debt is through consolidation programs. Many times, students and parents take out multiple loans to cover the cost of education. Sometimes, different loans are required for different semesters. Other times, loans might be for different institutions as students move up through degree levels. Regardless of the reason for multiple loans, students can consolidate loans to make it easier to make payments each month.
Consolidating loans means that you take out another loan; the proceeds of that loan are used to pay off existing loans. You then owe a single institution, which means you make a single payment each month. The single payment can be more convenient, and restructuring your loans might also reduce the amount you pay each month. Such consolidations are available for almost all federally backed student loans.
Consolidation is only one type of debt relief, especially if you are dealing with a financial situation that includes debt besides student loans. Despite popular belief, you can discharge student loan debt during bankruptcy. However, it can be difficult to do so and you might have to go through more levels of documentation than with other loan types. Working with a professional during the bankruptcy process can help you achieve a clean slate for a better financial future.
Source: FinAid, “Student Loan Consolidation,” accessed Aug. 13, 2015