Discover Consolidation Refinancing

Discover consolidation refinancing is a private student loan provider catering services like refinancing with new interest rates and monthly payments, resetting loan terms.

Updated by Annany Sah on 16th October 2020

Discover consolidation refinancing is a private student loan lender providing services like student loan refinancing. While refinancing you get a private student loan which is combined and refinances multiple education loans into one new loan with a new interest rate, repayment term, and monthly payment amount similar to refinancing. If you are extending your repayment term, this could increase your total cost over the life of the loan. Most private education loans do not compete on price, a private consolidation loan is just replacing one or more private student loans. So the main benefit of such a consolidation is to have a single monthly payment. Also, since the consolidation resets the term of the loan, this will reduce the monthly payment.

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Who is Discover?

Discover is known for its credit card business because it started from it and went on to provide services like loans, credit cards, and online transactions of home equity loan payment. Discover is a loan providing company that provides different types of loans such as personal loans, household loans, student loans, etc. Our main focus is on the student loan and that to discover private student loan consolidation refinancing. 

Discover’s student loans are a good option for borrowers who want flexible repayment options in case they need a wiggle room in the future. This loan is a private student loan. Discover offers a wide range of repayment assistance programs compared with other private student loan lenders, including the option to temporarily reduce payments. Discover provides very generous flexibility for those borrowers who are struggling and also are unable to meet the payments on time whereas the foreign exchange student is allowed a Cosigner as it is not allowed for a local borrower.

Discover provides in house service for its borrowers so that the borrowers don’t need to find every possible option for their Student Loans. Discover bar study loan is a special category of student loans offered by Discover for the students who take bar exams. 

Learn more about Discover Bar Study Loan Review

What is Debt Consolidation?

Debt consolidation rolls high-interest debts, such as credit card bills, into single, lower interest payments. It can reduce your total debt and organize it so you pay it debt sooner. If you’re dealing with a manageable amount of debt and just want to organize multiple bills with different interest rates, payments, and due dates, debt consolidation is a rational approach you can tackle on your own.

Consolidation of federal student loans

Discover provides consolidation for both private and student loans. Federal student loan consolidation combines multiple federal loans into a single federal student loan which is done by the Department of Education. Sometimes you may need to consolidate to be eligible for some federal loan repayment programs, but federal consolidation won't lower your interest rate. It may lower your monthly payments by extending them. Usually applicable for only federal loans with high-interest rates, but possible to apply for protection, repayment options, and forgiveness programs.

Consolidation of private student loans

A private consolidation loan is a student loan that combines and refinances multiple education loans into one new loan with a new interest rate, repayment term, and monthly payment amount. This could result in a lower interest rate or a lower monthly payment. There is no limit for the number of loans you want to consolidate, therefore you can refinance multiple loans into a single loan with discover. Applicable to both private and student loans with lower interest rates can help you save money though you'll not receive any federal protection benefits. Usually, this process can take a long time. After filling the application the approval for consolidation can take up to 45 days to process. Ideally, the process happens online. You pay 0 amount for the refinancing process. 

Looking to refinance your student loans? Find the best student loan refinance lenders

Why choose Discover?

Discover offers a larger range of repayment assistance programs when compared with other student loan refinance lenders, including the option to temporarily reduce payments. 

Here are a few points which tell why to choose Discover

  1. The maximum amount depends on the total  amount of attendance minus your financial aid

  2. The grace period given to the borrower is about 6 months if he/she is late on their payment

  3. The types of Loans provided by Discover are Graduate Loans, Bar Loans, Residency Loans

Interest rates and fees

  1. The Loan amount is $5000 to $1,50,000

  2. Refinancing interest rates - Variable Rates - 1.87% - 5.87% APR ; Fixed Rates - 3.49% - 6.99% APR

  3. The time period of the Loan Is 5 to 10 Years

  4. No transfer of the loan from parent to child

  5. There are no Late fees

  6. There is no prepayment penalty

  7. It provides a Loan term of 15 years

  8. The minimum amount provided is $1000

7 Reasons to consider student loan consolidation

Here are 7 reasons to consider Discover and the services it provides 

1) It's free

You can consolidate your federal student loans by yourself in this case, the process is free. The Department of Education says that the online application process takes most people less than 30 minutes to complete. However, people also hire a company or student loan expert to guide them through the process. There are multiple online guides that can help you with the process of consolidation. Always weigh the benefits you receive before you decide to consolidate your loans. 

Learn more about student loan consolidation

2) It simplifies your bills

Many borrowers have more than one student loan to keep track of each month. Consolidating or refinancing student loans could make it easier to stay organized, potentially saving you time and helping you avoid mistakenly missing a payment. The consolidation process can take up to several weeks or months. You should continue making loan payments until the servicer you're working which says your original loans are paid off and disburses your new consolidation loan. Simplifying your loan payments is very important so you don't find yourself in loan default. Once your loans are in default, it gets hard to borrow another loan in the future. 

3) Different repayment plans are available

You'll choose the repayment plan for your Direct Consolidation Loan when you apply for consolidation. Switching to an income-driven plan or the Extended Repayment Plan could be a good option to reduce your monthly payment amount. You can always change your repayment plan in the future.

4) Forbearance and deferment timelines reset

Federal and private student loans have limitations on how long they can be placed in forbearance or deferment - temporary periods during which you don't have to make loan payments. Because consolidation results in a new loan, forbearance, and deferment limits are reset by the process. This may be useful if you've had trouble making payments in the past and want to ensure that you have these options in the future.

5) New loan servicer

When you consolidate your federal loans, you'll choose a new student loan servicer. For private loan consolidation, you must choose the lender that best fits your conditions based on the loan terms you were approved for and the services it offers. If you are changing from your current lender, then your servicer will also likely change. So if you are unhappy with the service provided by the current student loan servicer, you can consolidate your loans to find a new one. 

6) New interest rate 

A Direct consolidation loan has the weighted interest rate of the federal loans you combined. This means that unless you change your repayment plan, you'll owe roughly the same amount each month and pay about the same amount in interest over the lifetime of the loan. The interest rate on a private consolidation will be fixed or variable depending on your choice, and it could be lower than the original interest rates on your private or federal loans.

7) Consolidating federal and private loans together

You may be able to consolidate your private and federal loans with a private lender who offers consolidation. Alike consolidating your private student loans, your new loan's interest rate will depend on your credit history and the option you choose between a fixed or variable rate. A creditworthy cosigner can increase the chances of approval and help you receive a lower interest rate. If you're eligible to make your payments, you could also use consolidation to release an existing cosigner from your student loans. Remember that is not recommended to consolidate your federal student loans to private loans at the risk of losing your protection benefits. 

Worried about your college tuition? Find the best student loan for you?

Discover refinancing reviews

Discover provides wide repayment options like temporary reduce payments which are not offered by other lenders. 10- 20 years of repayment terms are available.

Pros Cons
More flexible repayment options with temporarily reduced payments are available. The repayment term for more than 20 years is not available.
Refinancing is available even without owning a degree. Cosigner release is not provided by the discover loans.
There is no late fee. Does not disclose Min credit score to qualify.

The above article talks about a private lender called Discover which provides both private and federal student loans and also the facility of consolidation and refinancing. Discover is a great choice because it helps in getting a student loan without the need of a cosigner and provides a loan repayment period up to 15 years and provides a wide variety of loans such as Bar loans, Household Loans, Student Loans, etc.

Discover provides a wider range of repayment assistance programs compared with other student loan refinance lenders, including the option to temporarily reduce payments.