But, the difference is that lenders have become more flexible in terms of combining these parent loans with student loans to allow you to refinance it all into one monthly payment, and even extend the terms of repayment over 20 or 25 years in some cases.
There are ways to accomplish this, and the process for doing so is fairly simple. One thing to very carefully consider before consolidating your parents’ loans with your own is what impact it will have on your credit rating and how that will effect you over the life of that loan.
Learn more about Direct Consolidation Loans on the Federal Student Aid site Apply now at Student Private student loans are NOT eligible for consolidation into a Direct Consolidation Loan.
The extended period makes the monthly payment amount more manageable; however, the longer your loans are in repayment, the more interest you will pay over the life of the loan.[fsb-social-bar] A PLUS loan is a type of federal loan that helps students supplement their financial aid.PLUS loans are intended to fill in the gaps where other sources of aid and family contribution fall short.One of the messiest situations in student loan refinancing arises when a student is trying to consolidate and refinance their loans that were taken out by their parents to help them pay for school.This is a common occurrence because while in school, students are only allowed to borrow a certain amount in federal loans, and many times the student’s parents can take out additional funds in the form of a Parent PLUS loan to cover the rest of the bill. Department of Education, the Parent PLUS loan belongs to the parent–no matter who is making the payment each month.So, the interest rate on a consolidation loan may be higher than the underlying loans.