Indeed, federal law dictates that those who have just graduated or left college must be given a six month grace period, during which to find a job, find housing, get a car, and become established in society before they are required to make loan payments. Such a time period may be needed, especially if the amounts to be paid back range into the thousands of dollars and the monthly payments may take a great deal of money from his or her income.

When this grace period ends, however, people may face the dilemma of being financially unprepared for the potentially high monthly payments that their lenders may require. Additionally, some original banks often sell their loans to other companies, thus forcing a person to make several payments to different companies each month. In this circumstance, most individuals consider consolidating their loans into one amount with one company in a bid to escape such a dilemma.

Even with their loans consolidated into one amount, with one payment amount established for the terms of repayment, people may still find themselves financially incapable of making a monthly payment. As such, consolidation companies often offer an extension, called a forbearance.

A forbearance is often granted without challenge if a person’s monthly income stands below a determined amount of money. After he or she provides income statements or proof of unemployment status, he or she may be granted a hardship forbearance.

Because a consolidation requires that a person reveals his or her personal information, the former student is generally advised to research several companies before deciding upon which one to entrust with this matter. In fact, this research may begin before he or she graduates from college. As many schools require students to complete a financial aid exit counseling session, this provides an opportunity for them to ask a financial aid counselor for information about such businesses and how to find the best one.

When a person chooses a business from which to obtain a private student loan consolidation, he or she must tell that company where it may find the original loans and then give permission for the consolidator to purchase the original amounts. This process may take a matter of weeks or months, so it is advisable that the former student begin these steps as soon as possible after graduating.

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