Vinings GA Real Estate

 

Student Loan Consolidation

Mortgage Advice 101

 

Are you getting ready to purchase your first new home? Are you starting to get your finances in order? Then you might want to consider consolidating those student loans to a fixed rate right now.

Student loan consolidation allows you to refinance all or even just one of your student loans down to today’s current low rates. By lowering your monthly student loan payment, you will reduce your debt to income ratio and be able to qualify for a higher loan amount for a new home. First time home buyers are often stretching to get into their first home anyway so that added breathing room can become a lifesaver.

Just as important, by reducing your debt to income ratio, lenders have a little more room to work when trying to approve a first time home buyer.

For those who have not consolidated their student loans, interest rates for student loans will begin rising in June for the first time in five years. Those students who are still in school will see their current non-fixed interest rate rise from 2.9% to 4.8%. For those students OUT of school, their current non-fixed rate 3.4% will rise to 4.8%.

Congress is also reviewing a bill that would increase the minimum interest rate on student loans, an issue that could have a serious impact on student loan interest rates for those students who are still in school or have not converted their student loan to a fixed rate.