Should you pay off your credit card balance by taking out a new student loan? Sometimes lenders fund more than what you need to pay for books, tuition, room, board, and other expenses.

Transferring the amounts owed has distinct advantages and disadvantages. Learn the ropes before you pull the trigger.


The biggest challenge with debt consolidation loans including student loans is the existing and projected debt-to-income ratio.

Graduates with deferrals or on income-based repayment plans often look to push the envelope. If you are having difficulty staying current, new borrowing relationships are rarely the answer.


People do not like thinking about consolidating student loan debt when they are beginning their freshman year at college. At this stage, they just want the funding to pay the tuition, room, and board.

Surprisingly, having bad credit may actually help you qualify for grants and scholarships. Affording this costly expense is much easier when you do not have to repay the money.


Debt consolidations that include student loan balances can lower your monthly payment or reduce the amount of money you pay in interest – if you qualify.

Therein lies the rub for many applicants. The manner in which you finance your college education often has a profound impact on your credit report and score. It could be hard to qualify.


Student loan debt can seem like income when you are in the proceeds stage. Money just comes in from the federal government and private banking sources. The funds make it easy to enjoy your college years.

When applying for government entitlement programs be careful to avoid accumulating the funds in a bank account. You could trip a wire on resource limits.

The story changes once you commence the repayment phase.The debt may affect your application for a credit card, a mortgage, or an apartment rental.


Student loan debt presents an enormous challenge, once graduates settle down to buy a home, and perhaps start a family. Statistics show that college graduates delay marriage and other life events because of the large payments.

When purchasing a home, the mortgage lender will consider your debt to income ratio, along with your down payment and cash reserves. Paying off your loan affects both factors in opposite fashion.