Student Loan Consolidation Calculator

PRINCIPAL

While principal typically has several different meanings, in this iteration the principal refers to the original sum of money borrowed for the student loan.

APR (ANNUAL PERCENTAGE RATE)

APR is also commonly referred to as “annual percentage rate”.  APR refers to the annualized cost of credit which includes interest plus any additional fees or costs associated with the transaction.

WEIGHTED AVERAGE INTEREST RATE

The weighted average interest rate represents the average rate of multiple loans with varying interest rates and balances. In this case, loans with a higher balance with have more “weight” when looking at their final rate.

MINIMUM MONTHLY PAYMENT

The minimum monthly payment refers to the lowest amount of money required to be paid on the loan every month to remain in good standing with the financial institution.

Student Loan Consolidation Fundementals

Consolidating student loans is a fairly common way in which you can simplify your monthly payments and streamline your student loan bills. Many times, but not always, you will find that consolidation is done when you refinance your student loans, which helps to lower your overall interest rate. Check out some of our helpful articles below to get some of your common student loan consolidation questions answered and find out more on how combining your student loans will create a ‘weighted average’ as an interest rate.

What is the difference between student loan consolidation and refinancing?

This is a very common question that has been gaining momentum specifically in the student loan space in recent years. The difference between consolidation and refinancing is quite different so let us explain. When you consolidate student loans, you are simply combining multiple student loans in this case into one more manageable loan. This is helpful for a few reasons but one of the main reasons that this is so helpful is you no longer have to juggle multiple student loan payments and different times of the month with different student loans servicers. Instead, you will have one payment due per month to one student loan servicer.

When you choose to consolidate your student loans, all of the loans are added up. To find the interest rate of the loan, the company who consolidated the loan will find the weighted average of the interest rates on the loans you combine. One big thing to know about consolidation is that you will not save money on a new interest rate, rather doing this will make it much easier to manage your student loan debt in one singular place rather than multiple student loan servicers and times of the month you would need to pay.

In regards to refinancing, this can typically be done with several loans, or simply one loan and involves the process of getting a new loan all together which (usually offers) a lower interest rate than before. As an example, if you wanted to lower your monthly payment due to financial issues or strain you would want to refinance your student loan. As for when you do refinance, you generally will find a third party lender who will work with you to help pay off the original loan amount to the student loan servicer and you will get a brand new unified loan with a lower interest rate that you will now pay this third part bank for.

Can I refinance loans that have been consolidated or refinanced previously?

In most cases Yes. Generally the best way to see if you qualify is to reach out to one of our refinancing partners to see if your loan is eligible to be refinanced or consildated again. Please note that previous consolidation or refinancing applications will not affect the eligibility of this application with most lenders. For more details please head over to our refinancing page.