Consolidation Loans combine several student or parent loans into one bigger loan from a single lender
which is then used to pay off the balances on the other loans. It is very similar to refinancing a mortgage. Consolidation loans are available for most federal loans...including FFELP (Stafford
PLUS and SLS)
FISL
Perkins
Health Professional Student Loans
NSL
HEAL
Guaranteed Student Loans and Direct loans. Some lenders offer private consolidation loans for private education loans as well. School Loan consolidation is among the most important and advantageous financial decisions recent graduates and former students can make.
Why Do Most Students Consolidate Their School Loans?
- To lower monthly payment amounts by up to 45%
- To give them an opportunity to build their credit rating
- To make only one student loan payment each month

The Info on School Loan Consolidation Discounts.

Why Lenders Offer Loan Discounts.
The Higher Education Act of 1965 sets the maximum interest rates and fees on student loans. This helps protect loan gouging by student loan lenders
making access to student loans relatively easy for those who are in need of financial aid. Nothing
however
prevents a lender from charging lower interest rates and fees. (The illegal inducements regulations prevent lenders from providing immediate rebates
which would be similar to paying borrowers for their loans. However
most lenders work around these restrictions by instituting a one month delay in rebate discounts
or by providing the discounts when the loan enters repayment)
Lenders offer loan discounts for competitive reasons. Originally the competition was with the Direct Loan program. However
with the repeal of the single holder rule
lenders are increasingly competing with each other for the highly profitable student loan market. If you currently have multiple student loans
you should get the proper information regarding consolidation of those loans.