Students are being advised that the interest rates for student loans will be increased in 2006.
2006-06-19 18:46:39 · 7 answers · asked by phyllismarieagnes 1 in Education & Reference ➔ Financial Aid
ok, stafford loans have a variable interest rate. this means that it can change every july 1. it's possible that in july 2007 the rate would drop or that it might rise again. by consolidating, you are avoiding the risk of higher interest rates. but, you lose your grace period and the possibility of the rate dropping lower than it is currently. im a financial aid officer, if you have questions, please feel free to email me.
2006-06-20 09:37:27 · answer #1 · answered by lenny 3 · 1⤊ 2⤋
You don't have to combine them; no one does. It's good advice and *not* a threat. The student loan interest rates are based on the 91-day T-bill and are reset every July, so they already know what the rates will be. Stafford Loan rates for in-school (and in-grace/deferment) borrowers will increase from 4.7% to 6.54% on July 1st.
Borrowers are perfectly welcome to leave their loans unconsolidated... In that instance, their loans' rates will just go up and down as the economy does. No big deal, particularly if you want to retain cancellation benefits or if you plan on paying it off right away.
Has a lot of emphasis has been placed on consolidation lately? Yes, but for good reason. Students deserve to know all their options before being sent out into the world with record-high debt levels.
2006-06-20 14:48:00 · answer #2 · answered by FinAidGrrl 5 · 0⤊ 0⤋
i'd renowned this isn't the right area of do. yet about 60% as of now are defaulting on pupil personal loan. Delinquency is all time intense. i'm antisocial too. with the aid of really intense default price, the expenses of interest on those who're in a position to pay pupil must be raised so as that it "covers" if you happen to do no longer pay. In complicated economic gadget, complicated selections could be made. pupil personal loan bubble burst is around the nook and it ought to steer on to a sparkling recession the way actually everyone appears defaulting proper and left. those who make pupil personal loan price as we talk will be preyed upon the way a tiger preys on deer -- they're going to be milked and creamed authentic reliable and that is the full theory in the back of it. This situation will be avoided if actually everyone who graduates is in a position to pay again the inner most loan -- and which couldn't taking position because jobs are not there. At this element there is a million trillion pupil personal loan debt - better than mastercard debt. 750 billion of it has lengthy gone into pink ink -- i.e. no longer being paid. i understand many liberals were putting forward interest marketplace is convalescing although the pupil personal loan pay again archives is horribly undesirable. Delinquency is merely record intense. So i'm at a loss myself to appreciate what precisely is convalescing
2016-10-14 08:06:03 · answer #3 · answered by corridoni 4 · 0⤊ 0⤋
Perhaps the loan has a 'variable' rate. Perhaps the person offering the loan is saying that they are offering a fixed rate now which is lower than they will be able to offer later.
In any case, the 'student' is not FORCED to combine them. As with any financial document, read the fine print, and check it out yourself. Compare offers, ask your bank about any options they might be offering. Talk with your parents or financial planner.
2006-06-19 18:57:15 · answer #4 · answered by blane309 1 · 0⤊ 0⤋
The interest rates are expected to increase in July (I think they are set to do so every July).
Contact your lender and ask for a consolidation.
Depending on where you are in school (ie how many years of loans will you be taking out) you may just want to wait and refinance once interest rates start to drop (which they should do in three or four years).
Also, there are limitations for current students to refinance.
2006-06-20 04:14:15 · answer #5 · answered by Veritatum17 6 · 0⤊ 0⤋
July 1, 2006 The Interest rate goes UP!!! That's not a threat is it reality!!! Going up over 2%.
2006-06-19 18:51:33 · answer #6 · answered by jennifersuem 7 · 0⤊ 0⤋
It sucks, but you have to play the game to survive in Bush Country. If it helps save you money, do it. My fiance just got that email too. She doesn't like it either, but she also doesn't want to pay more money when the goverment comes calling for the payments.
2006-06-19 18:53:14 · answer #7 · answered by pobox01 2 · 0⤊ 0⤋
Because that's how the Bush administration defines "helping" the education system.
2006-06-19 18:50:13 · answer #8 · answered by Anonymous · 0⤊ 0⤋