New Student Loan Rates Set - Consolidate Prior to July 1 to Save 39% or More
New Student loan rates were set this week for students currently holding loans. Rates are increasing 39%.
Students are urged to consolidate their loans immediately to lock in the current rate before June 30, 2006.
San Diego, CA (PRWEB) June 2, 2006 -- New Student loan rates were set this week for students currently holding loans. Students are urged to consolidate their loans immediately to lock in the current rate before June 30, 2006.
“We are seeing a big rate increase for the 2nd year in a row” states Mary Montiel of Collegiate Funding. http://www.collegiatefunding.com Collegiate Funding is a free resource for Students and Parents.
The new rates will go into effect on July 1, 2006. Students that are currently in their grace period or in school will see their rates rise 39% from 4.7% to 6.54%. Students who are currently in repayment will rise 35% from 5.3% to 7.14%. Parents with Federal PLUS loans will increase 30% from 6.10% to 7.94%
These rates apply to students with loans disbursed 7/1/98 to 6/30/06. Students with loans prior to 1998 will have a slightly higher rate increase.
By consolidating now two things happen. The loan converts to a fixed rate instead of a variable rate. Variable rates can increase to 8.25%. Secondly, the loan term is extended from 10 years to 12 - 30 years depending on the amount of the loan.
By consolidating prior to the deadline, a student with $20,000 in loans will save $5,257 over the course of the loan. “We are working around the clock trying to get the word out” states Mary Montiel. Students should also shop for the best incentives. A few lending companies offer additional incentives that may further reduce the rate for a certain amount of on-time payments and auto debit. “Collegiate Funding offers an incentive of 1% after 36 months of on-time repayment and an additional ¼% immediately for auto debit” states Mary Montiel of Collegiate Funding.
A 1 ¼% incentive will save a student an additional $3,675 on a $20,000 loan. By consolidating with these incentives prior to July 1, a student will save $8,932 over the life of the loan.
Student and parents with loans should act fast. The deadline is quickly approaching. Students who are in school may also consolidate. This is the last opportunity to consolidate if you are in school as this regulation also changes as of July1, 2006.
For more information on consolidating contact Collegiate Funding at 800-918-7587 or complete a request online at http://www.collegiatefunding.com To expedite your application Electronic Signature is also available.
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