| The rate for federal student loan will change in a | | | | Saving $ 700 is not the only advantage of |
| month's time. The rate of the variable rate Stafford | | | | consolidating student loan. Student loan consolidation |
| student loan will go up by 0.08 per cent to 7.22 | | | | also allows borrowers with high balances to lower the |
| The rate for the different federal student loan | | | | amount they pay each month by fixing a rate of |
| programs are recalculated every July 1 based on a | | | | interest for the entire loan amount. In addition, |
| Department of Education formula, which is tied to the | | | | borrowers can choose from a number of repayment |
| 91-day U.S. Treasury bill. For the first time in several | | | | options including standard repayment. |
| years, the rate on the student loan did not go up by | | | | The current "grace period" consolidation rate for the |
| too much. The rate of the variable Stafford student | | | | student loan is 6.625 per cent; however, the rate will |
| loan went up from 6.80 to 7.22 per cent. | | | | increase to 7.25 percent for borrowers who miss the |
| The rate of the PLUS loan also went up by the same | | | | grace period discount. |
| amount. The PLUS loan is a federal student loan | | | | Once borrowers recognize the merits of student loan |
| program for graduate students. It is also a program | | | | consolidation they need to shop around for the best |
| that allows parents to borrow money to put their | | | | deals to consolidate student loan. Some of the |
| children through school. The rate on the PLUS student | | | | common incentives that are offered to borrowers |
| loan went up to 8.02 per cent. | | | | include a reduction of 0.25 per cent in the interest rate |
| While the percentage increase of the US Department | | | | for borrowers who choose direct debit on the |
| of Education student loan may not seem like a lot, | | | | standard repayment. |
| given the amount of money that students borrow for | | | | Borrowers who make on-time payments for 36 |
| college, every penny saved is well worth it. | | | | months are also eligible for a student loan rate |
| Even though the percentage increase in the student | | | | reduction of 1 per cent on the remainder of the life of |
| loan rate did not go up by much, students graduating in | | | | the loan. Students need to negotiate with the lending |
| 2007 who consolidate within their grace period of six | | | | agency about the terms and conditions of the loan |
| months can save a lot of money. The reason for this | | | | repayment. |
| is that by consolidating during the grace period, | | | | For more resources about Loan consolidation or even |
| students can receive a 0.60 percent interest rate | | | | about School loan consolidation and especially about |
| reduction on the U.S. Department of Education student | | | | Student loan please review these links. |
| loan. This translates into a saving of $700. | | | | |