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Loan Consolidation

What is consolidation?

Loan consolidation is a new loan that is created by combining the repayment of two or more loans to reduce the amount of monthly payments and extend the loan repayment term.

Should you consolidate?

We believe that an important consideration in the decision to consolidate should be the total cost of the loan. This can be higher with consolidation because the repayment period is much longer than the standard period. Further, any benefits associated with loans are lost when those loans are consolidated.

Students and parents who borrowed through the Michigan State University Michigan Students First program from Fall 2003 through Spring 2008 should know the following facts:

  1. You already have one of the lowest interest rates possible. If you make your payments on-time, your interest rate will fall to 0% (ZERO!) after 36 payments and remain at 0% for the rest of your repayment period. This means that if you pay on time, you will have no interest for at least seven years.
  2. You will lose the zero interest rate and all other special borrower benefits if you consolidate your MSF loans.
  3. You do not have to consolidate to negotiate lower monthly payments. You can request an extended repayment schedule from MSF’s loan servicer, Great Lakes Loan Servicing, at any time. This will lower your monthly payments while extending the repayment period.

Michigan State University selected the Michigan Students First program because at the time it offered benefits that were not available from other programs. Please compare rates and terms CAREFULLY before deciding to consolidate.

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