Should I Use a Personal Loan to Pay off My Student Debt?

Share:

Facebook Tweet mail
blog post author image
Written by Carlie McKeon | Last Updated September 11th, 2019
Follow Carlie McKeon on Google+

news-money-matters-2

Many graduates are finding themselves deep in their student loans and are searching for ways to help pay them off quicker. One option they are discovering is to use small personal loans to payoff and save on high-interest loans. The personal loan is a way to pay off the higher interest loans under new and more favorable conditions. Huffingtonpost has come up with these advantages:

  1. You may have access to a lower fixed rate loan by using a personal loan.
  2. Personal loans usually have shorter payoff periods if your goal is to pay off your loans as fast as possible.
  3. Your student loan can be combined into one convenient payment.
  4. You can release any cosigners you have on your student loans. If you qualify for the personal loan on your own, the person who cosigned for your student loans will not be obligated on your new loan.
  5. Unlike most student loans, a personal loan is dischargeable in bankruptcy

And these disadvantages:

  1. Could lose the benefits of forbearance and deferment options on federal loans
  2. Most lenders have a limit on loan amounts for personal loans and if you have new credit a lender may not feel like you have sufficient credit history to warrant a high loan amount
  3. No tax benefits on a personal loan

A personal loan could be a great option to help pay off your student loans. There are lenders that offer personal loans just for that purpose. Find out all your options of how to repay your loans and discover which option is best for you.

The Top Personal Loans Companies

company logo
#1 Best Egg chevron_right
9.3 Overall Score
4.9
starstarstarstarstar_half
(7,103)
company logo
#2 FreedomPlus chevron_right
7.1 Overall Score
4.6
starstarstarstarstar_half
(1,984)
company logo
#3 SoFi chevron_right
6.8 Overall Score
4.8
starstarstarstarstar_half
(119)

Related Articles

5 Tips for Getting Your Personal Loan Approved

August 14, 2017

Personal loans are generally a bit different than other types of loans. You might need a personal loan to meet your eve...

Read More
8 Things You Need to Know Before Taking Out a Personal Loa...

July 31, 2017

Personal loans can be a good place to turn if you are low on funds but need to consolidate high-interest debt or make a...

Read More
Will My Credit Score Be Negatively Affected If I Apply for...

January 20, 2016

Are you considering a personal loan? Are you worried about how applying for or borrowing a personal loan will affect y...

Read More