With the increasing amount of student debt and the soft economy, many college students and graduates are having trouble making their monthly loan payments. Thankfully, there are banks willing to help out the students and aid them in solving this problem. Several lenders have begun offering products and services that focus on these loans and the students who took them out. The Citibank student loan consolidation is one of the most common in the market. There are three things you should look for before applying for one of these loans.
Pay On Time
The first thing you should be on the lookout for is lower interest rates. Usually a student loans consolidation package will have lower interest rates. There are two different ways this can be done. The first is that the bank can offer lower interest on student loans consolidation if the borrower pays their loan bill on time for the first six months. There is also a second way to get lower interest rates.
Automatic Payroll Deduction
The second way that banks offer lower interest rates is if the borrower agrees to sign up for an automatic deduction from her bank account. Many lenders believe that an automatic charge leads to fewer missed payments. Because the money is deducted immediately. they do not have to rely on the borrower to put the check in the mail or go to their online account and make an electronic payment. With the automatic payroll deduction, it is very quick and easy for both the borrower and the bank. This makes the bank likely to accept a lower interest rate as one of the terms of the loan.
Increase The Loan Duration
Most lenders will also be willing to make a consolidation loan at a lower interest rate if you agree to a longer life of the loan. This makes sense and is helpful to both sides. If you are going to pay them less each month, they want to be paid for longer to make up the difference. Of course, it helps the borrower by making it easier to meet monthly budget requirements. The actual amount paid out each month is less.
Consolidating student loans can be a great idea. Citibank student loan consolidation is one of the most popular programs for good reason. Before you agree to a loan with Citibank, or with any other loan provider, be sure to consider the three points above and negotiate for the best possible terms for yourself.