A rebate to consolidate student loans is a term used to describe the process by which a current lender agrees to consolidate a student loan for a current borrower. Individuals who are interested in finding the lowest interest rate and best terms for their loans often seek out new lenders. The hope is to find a more affordable repayment solution. However, the current lender may be willing to extend a rebate or discount offer to a good borrower to keep the business with them.
Rather than allowing an individual to take their business elsewhere, the current lender offers a discount to their borrower that entices the borrower to stay with the company. This often occurs only after an individual has taken the time to obtain quotes from other lenders and then approaches their current lender requesting a rebate on the consolidation student loan. In fact, each individual should use this process before they agree to switch from one lender to the next. Find out what your current lender is willing to offer to you.
There are various types of discounts or rebate types that the new lender may offer to you. The lender may offer to reduce the interest rate you are currently paying. The company may waive the final six monthly installments if you make all previous installments on time. The company may reduce the principle amount after a certain time period. The lender may also offer to extend the repayment period so as to give the borrower lower monthly payments.
In general, these cost saving methods can be beneficial to all involved. Those who wish to use student loan consolidation often need to invest time into the process of finding other lenders. The process of consolidating student loans is not hard, but it does take time. If you stay with the same lender, though, and simply request a rebate for the student loan consolidation, the process is simplified.
Why would a lender agree to discount your loan like this? There are thousands of private lenders and other companies vying for your business. Each company needs to take measures to keep borrowers with them rather than allowing them to move on to another company. Further, the discounts offered do still allow for the company to make a sizable profit. In some situations, it may take longer for the company to realize that profit, but it will happen.
How can you get this rebate? Contact several lenders and request a free, no obligation quote for a student loan consolidation. Then, approach your current lender with the offers presented to you by other companies. Request that the lender offer a rebate to you and to consolidate student loans for you. Many will agree to this just from this information.
Before taking any offer from a lender, do compare the short term and long term benefits of it. In some cases, the rebate or discount offered may not offer the best savings over other lender offers. If you need lower monthly payments, an offer to cut off the final six months of payment will not accomplish your goal.
In many cases, a rebate to consolidate student loans can be effective. It can save you money. Do consider this option as well as others.