There’s several potential perks to student loan consolidation – getting a lower monthly payment, fewer bills to keep track of and sometimes even a lower interest rate. Improve your chances of an approval by knowing what we’re looking for. If you don’t think you’ll meet all of the requirements below, don’t sweat it, a cosigner (like your parent) could help you meet the requirements and qualify for a better rate. Plus you may have the option to release your cosigner from your loan after 24 months.
Our basic eligibility requirements.
All borrowers must be U.S. citizens or permanent residents. If using a cosigner, both the borrower and cosigner must also be of legal age as defined by their state of permanent residence, which is essentially the state you file your taxes in. In case you didn’t know, the legal age isn’t 18 in every state.
Positive credit history is needed for student loan consolidation.
The borrower or cosigner must have at least 2 years of positive credit history and meet other creditworthy requirements. For our purposes, “creditworthy” includes factors like:
- The applicant has no open collections or charge offs in the past 2 years.
- There have been no bankruptcies, foreclosures or repossessions in the past 7 years.
- The applicant hasn’t defaulted on a federal or private student loan.
- The minimum credit score is met by the applicant and they have at least 3 years of credit history.
- (Remember the applicant as referred to above could be the borrower or cosigner.)
It’s important to borrow responsibly.
To ensure you’ll be able to make regular payments, either the borrower or cosigner must have an annual income of $24,000 or greater for the past 2 years. They also may not exceed the debt to income threshold of 45%. This means if your monthly income is $2,000, your total debts must not be greater than $900 each month. Keep in mind, we offer flexible repayment options as well as deferment and forbearance options in the event of future financial hardship.
Most education loans are eligible.
Both federal and private loans can be consolidated, regardless of which school you went to. Also, if your parent or guardian took out a federal Parent PLUS loan to help with your college financing, it can be included in your consolidation loan as well. However, if you’ve been working toward federal student loan forgiveness, you will lose those benefits upon consolidating, so keep that in mind before throwing any federal loans in the mix. The minimum consolidation loan amount is $10,000 and the maximum is $250,000 for both undergraduate and graduate loans.