Loan Consolidation Gotchas

Gotcha (noun):
An endeavor in which one party seeks to catch another, as in a mistake or lie.
Source: Dictionary.com, Copyright © 2001

Unfortunately, some student loan consolidators use misleading marketing tactics to entice you with their “not-so-easy-to-keep” loan discounts.  We’ve researched their fine print for you, and want to share some common gotchas that you should look for when shopping for a consolidation loan.

They say…Avoid getting another bill in the mail by choosing to receive your bill via email!

The Gotcha…If you forget to reply to the e-bill every time you receive it, or if your email bounces back, then kiss your discount(s) goodbye!

They say…Keep your discount as long you continue to make on-time payments!

The Gotcha…You must make on-time payments for the life of the loan.  That can be for 30 years, depending on your repayment term.  Instead, check for discounts that become permanent as soon as you earn them.

They say…Sign up for automatic payments and you won't lose your discount! 

The Gotcha…You must sign-up for auto-payments after signing your application.  However, the lender may “conveniently” not send that auto-pay form, so be sure to ask for it.  No Auto-Pay Form + No Auto-Pay Sign-Up = No Loan Discounts.

They say…Get the best deal with “our” borrower discounts!

The Gotcha…As long as all of your loans are serviced through that one lender, then you’ll receive those loan discounts, or benefits.

They say…You could be eligible for pre-July 1st interest rates!

The Gotcha…Once you complete your application with them, they’ll simply turn around and say that you don’t qualify.  Instead, have them confirm your eligibility before you sign any contract.

They say…It’s better to combine all of your education loans into one consolidation loan

The Gotcha…Of course it is - FOR THEM. Don’t fall for this gotcha. Everyone’s education debt is different, and depending on your financial needs consolidation may not be in your best interest. 

Student Lending Works - No Gotchas!
Our nonprofit mission is to lower the cost of education for students and their families.  At Student Lending Works, we don’t have any “gotchas”. Call us at 1-877-256-0066 and we can help you determine the best consolidation loan option that meets your needs.