Loan consolidation is a process through which you can simplify the process of your paying back the loans. The process is to combine divergent types of loans in to one consolidated amount. Normally this practice is followed by those who have obtained multiple federal educational loans. Thus you will make only one premium payment each month after such loan consolidation. The advantage is that the amount could be lower than what you are now paying. This is something akin to the process of bill consolidation.  

There are two types of loan consolidation for you. One is direct consolidation and the other is FEEL or Federal loan consolidation. The debtor makes one bulk loan to pay off the multiple loans. Loans for which you are getting subsidies and those for which you are not getting any such subsidies shall be grouped separately to ensure that you do not lose interests and subsidies on such loans. The basic difference between loan consolidation and debt consolidation is that in the former you get new rate of interest and new terms and conditions and these are basically related to your student carrier educational loans. The later is consolidating debts of all types into one lowering the premium and interest and making the payments easier.

Both debt and loan consolidation are part of debt help extended to needy borrowers by the consolidating agencies. Both processes are supported by the Debt Consolidation Firms you entrust with the task of lowering and managing your debts.