Consolidation

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Lower payments, larger payout — is it worth it?

With a Consolidation loan, you can extend your repayment period to up to 30 years (depending on your total education loan debt), which can lower your monthly payment. However, the total amount you pay in interest over that extended period can really add up!

TG has developed the following charts to illustrate how much more interest you'll pay in the long run if you extend your repayment period now. These charts show, based on sample debt amounts and allowable repayment lengths, what the monthly payment will be. They also show what the total interest and total loan amount will be once the loan is paid in full. For the following repayment schedules, we used a fixed interest rate of 6.875%. If you want to estimate the repayment for your own situation, visit TG's Consolidation Calculator.

If you consolidate $15,000 of student loan debt...

…and repay it over	Monthly payment	Total amount paid	Total interest paid
10 years	$173.21	$20,785.20	$5785.20
15 years	$133.79	$24,082.20	$9,082.20
20 years	Not available for this loan amount
30 years	Not available for this loan amount

If you consolidate $30,000 of student loan debt...

…and repay it over	Monthly payment	Total amount paid	Total interest paid
10 years	$346.40	$41,568.00	$11,568.00
15 years	$267.57	$48,162.60	$18,162.60
20 years	$230.35	$55,284.00	$25,284.00
30 years	Not available for this loan amount

If you consolidate $60,000 of student loan debt...

…and repay it over	Monthly payment	Total amount paid	Total interest paid
10 years	$692.80	$83,136.00	$23,136.00
15 years	$535.12	$96,321.60	$36,321.60
20 years	$460.70	$110,568.00	$50,568.00
30 years	$394.17	$141,901.20	$81,901.20

Keep it short
As you can see, relatively small reductions in monthly payments can have an enormous impact on the total loan debt you'll have to repay. If you consolidate, your best option — if you can afford it — is to request a shorter 10-year or 15-year repayment schedule. If you must request a longer repayment schedule to make your monthly payments more manageable, consider making an extra payment whenever possible to be applied directly to the principal balance of the Consolidation loan — it makes smart financial sense!