Distance Learning College Loan Consolidation
Forget About Federal Programs
Distance learning, or online education, is one of the fastest growing segments of higher education. Adult learners, professionals and college students with families to care for, all qualify as distance learners. Adults seek timely, innovative experiential and/or practical course work that cuts to the nitty-gritty of a profession. They look for applicable student loans and for ways to relieve the stress of high monthly payments.
Distance programs may be more cost-effective than traditional, campus-based programs, but they pose a financial problem for student/borrowers with other more demanding financial responsibilities. The challenge is to find consolidation loans that make it feasible for distance learners to combine their educational loans into one, easily managed monthly payment.
Federal consolidation loans offer nothing for the distance learner. Federal loans still require students to attend a traditional college program either half or full-time.
"Non-Traditional" For How Long?
However, in response to the gap in financial aid for distance learners and other non-traditional students, private student loans providers are slowly but surely anteing up a few customized private loans for this population of borrowers. For example, Sallie Mae offers a Continuing Education Loan.
Consolidate Distance Learning Loans
Educational loans specifically designed for career training, certificate programs and continuing education students all fall under private loans. If you are shopping for a consolidation loan to cover loans like these, as well as any other private student loans you may have, you’ll find a fairly wide assortment offered. Private lenders have become savvy with their own brand of private consolidation loan, realizing the huge potential in the market. Private student consolidation loans all share similar features:
- Credit-based, so if you don’t have good credit make sure you have a creditworthy co-borrower.
- Variable interest rates.
- Loan fees.
- Minimum amount required.
- Up to 30 years to repay depending on amount financed.
- Many welcome outside borrowers.
Consolidate Previous Federal Loans
If you are a professional or student pursuing an online program and are still paying on outstanding federal student loans from a previous degree, then consider a federal consolidation loan or an alternative debt management strategy.
- Direct Federal Consolidation Loan requires you have at least one Direct Federal Loan to qualify or have a FFELP Loan that is ineligible for a FFEL Consolidation Loan. The federal consolidation loans feature fixed interest rates calculated, on the day you apply for consolidation, on the weighted average of the loans. Interest rates will not exceed 8.25. Also you are not required to have a credit check and the loans are fee-free.
- Are your loans through a Federal Family Education Loan Program (FFELP) lender? If so you may apply for the FFEL Federal Consolidation Loan that guarantees the same standard terms as the Direct, but allows lenders to customize. Shop for borrower benefits that offer small interest deductions for grace period consolidation, so many consecutive on-time payments and automatic payment deduction.
Alternatives to Consolidation
Despite the decline in student loan consolidation, lenders have rallied to provide borrowers with alternative means to manage unwieldy student loan debt. Worth mentioning are the new extended repayment plans many borrowers may have at their disposal. Ask your lender for details on customizing your loan repayment.
