Nowadays people are very interested in the continuing of their education and in receiving of the university degree. Those people who have university degree have usually better career opportunities, more chances on the labor market and higher level of incomes. But the tuition fee and other studying expenses are very high, so the students cannot cover all these expenses without additional financial aid. There are three main types of the financial aid for students: student`s loans, student`s scholarships and student`s grants. The loans are the most widespread, as the application process is not very complicated and all students have chances to receive student`s loan. Unfortunately, majority of the students collide after graduation with the problem of the debts repayment. To simplify the process of the debt repayment and to reduce the amount of the debts, the students often use the financial tool of loan consolidation. The loan consolidation means itself the combination of the student’s loans into one manageable loan with one lender, one month payment and lower level of interest rates. If the students will keep all rules and pay the bills in time, they will have an opportunity to improve the credit score and establish good credit history.
Before the consolidation the students have to pay attention on the following factors. Usually the students do not pay attention on the details of the loan agreement, such as duration of the grace period, level of interest rates, and duration of the repayment period and repayment options. Usually people do not pay their attention on the amount of their debts until the graduation.
The students must understand that they can consolidate only federal loans, which were provided by the government. The students can also consolidate the loans which their parents received to support the studying. But the private student`s loans cannot be consolidated.