So I consolidated my Federal student loans, but what to do about private loans!?!

[PizzaDude]

I consolidated my federal student loans and locked into a low interest rate last June(at ~3%), but what is my best option to take care of the 40k in private loans that are at 7-9% interest rates.

Any input would be greatly appreciated.

Thank you.

 

[Nerva]

refinance?

 

[PizzaDude]

Originally posted by: 3cho
refinance?

The "how" and the "where" is kind of what I'm looking for, as if it wasn't obvious.

 

[Parkre]

I would start paying them off as quick as possible....

 

[PizzaDude]

Originally posted by: Parkre
I would start paying them off as quick as possible....

Well, I'm looking for a way to lower the rates and if consolidation of these private loans to lower payments and the rates is possible.

Otherwise, yes, this is the smartest option(duh).

 

[Strk]

Where did you get 3%?

 

[Savij]

As I understand it, if they're with multiple lenders you can consolidate them and lock in rates. If they are with one single lender then you are screwed...as far as interest rates go.

 

[jjdeltor]

Yeah i was in this same situation a few years ago. Basically there is not much that can be done. You only option is to go to your financial institution and see if you can put together some sort of private loan and use the funds from said loan to pay off your private student loan debt. May even be able to get a pretty good rate. If you do this though, the new loan is considered personal and you will not be able to deduct the interest on your taxes as can be done with student loans (both private and govt. funded).

-J

 

[AndrewR]

Originally posted by: jjdeltor
Yeah i was in this same situation a few years ago. Basically there is not much that can be done. You only option is to go to your financial institution and see if you can put together some sort of private loan and use the funds from said loan to pay off your private student loan debt. May even be able to get a pretty good rate. If you do this though, the new loan is considered personal and you will not be able to deduct the interest on your taxes as can be done with student loans (both private and govt. funded).

-J

The interest reduction could be worth it alone. Also, if you have sizeable government loans as well, consolidated or not, the interest deduction from those might max out your yearly maximum of $2500 anyway -- it does for me.

Treat the private loans like credit card debt and pay off in as short a time as possible. If you hear anyone about to take out private loans to pay for school, tell them to find a cheaper school!