Does that mean that a student loan I have at 4.75% will change to a different interest rate, starting tomorrow? I also have loans that are 5.75%... I've started the application for cosolidation on-line and it states my interest rate would be 5.5% is that really better? What will the instrest be? If my rate will stay the same for my 4.75% loans I won't want to consolidate them right?
2006-06-30 12:24:24 · 2 answers · asked by double v 5 in Business & Finance ➔ Personal Finance
Interest rates on student loans are variable until you consolidate. So starting tomorrow, assuming you don't consolidate, your 4.75% will move up to the new rate. You definitely want to lock-in that 5.5% while you can.
Hope this isn't too late to help or that you were able to find your answer elsewhere...
2006-06-30 14:09:45 · answer #1 · answered by LoveMy2J's 2 · 0⤊ 0⤋
the loan you get from uncle sam is what is known as a variable rate... The rate is based on the rate set by the federal reserve minus a couple of percentage points.
As the Fed rate goes up, so does your loan rate, and your interest, and your payment.
A consolidation loan is usually a fixed flat rate for the 12 or 25 years. Watch out though, if you are still a student, you lose forbearance priveleges.
2006-06-30 15:26:12 · answer #2 · answered by Michael W 3 · 0⤊ 0⤋