Fortunately, we’ve highlighted the six best banks and lenders to help you refinance and consolidate both private and federal student loans, based on your financial situation.With student loan consolidation, you may be able to refinance at a lower interest rate, decrease your monthly payment, or both!When you consolidate federal loans, your new fixed interest rate will be the weighted average of your previous rates, rounded up to the next ⅛ of 1%.So, for instance: If the average comes to 6.15%, your new interest rate will be 6.25%.
The result is a single monthly payment instead of multiple payments. Direct PLUS Loans received by parents to help pay for a dependent student’s education cannot be consolidated together with federal student loans that the student received.
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That being said, not all student loans are created equal.
Interest rates on student loans usually vary by loan type, rate type, and credit worthiness.