Consolidation does not affect a credit rating. Debt that is the result of education is considered a positive on a credit report.
The first step of consolidating student loans is to talk with the lender or lenders of the loan and then shop around for a lender that will offer the best terms such as interest rate. Lenders have different application processes that borrowers must go through to consolidate loans.
Typically, lenders require a minimum amount owed to consider consolidating balances. The amount is usually $7,500, but some go as low as $5,000.
The first way is to shop around for an interest rate. This is how lenders compete for business, and remember that a fraction of a percentage over time can add up to hundreds, if not thousands, of dollars. Lenders also offer discounts for direct debit, reduction in principal or loan-fee forgiveness. Some discounts are tied to whether a borrower makes the payment on time.
Loans can only be re-consolidated if the borrower has a new loan to add.
Private loans cannot be consolidated with federal student loans, but some private lenders, however, do offer consolidation of private loans.