La Jolla, CA (PRWEB) June 28, 2006
With one of the most substantial increases in federal student loan interest rates in history occurring on July 1, borrowers are running out of time to take the steps necessary to lock in the current low rates. Fortunately, there are ways for procrastinators to beat the deadline and save thousands of dollars in interest by rolling outstanding student loan debt into a fixed rate federal consolidation loan. According to Chris Studer, Founder and CEO of ScholarPoint Financial (http://www.ScholarPoint.com), cutting-edge methods have made it possible to easily consolidate student loans up to the last minute.
“In the past, the function of student loan websites was to promote services and provide contact information for sales representatives. Borrowers still had to do a lot of work over the phone and through the mail, which caused consolidation to remain a time consuming and complicated process,” said Studer. “Now it‘s possible to complete the entire process online without credit checks, fees, or income verification. The entire process only takes a few minutes, so borrowers still have time to take action before their interest rates skyrocket. Technology has made the transfer of information almost instantaneous, meaning that borrowers who use a complete online application with e-signature literally have up until the last second on June 30 to consolidate, although that’s probably not advisable. The sooner borrowers take action, the better.”
Mandated by Congress, interest rates are reset every July based on the results of Treasury Bill auctions. The impending 1.84 % rate increase will affect all federal student loans that are not consolidated prior to July 1, 2006.Under the new rates, Stafford loans in repayment will shoot skyward from 5.3 percent to 7.14 percent, Stafford loans in deferment will climb from 4.7 percent to 6.54 percent, and parent PLUS loans will jump from 6.10 percent to 7.94 percent. In addition to the increase for existing loans, Congress has already mandated that all new Stafford loans after July 1 are to be fixed at 6.8 percent and new PLUS loans will be fixed between 7.9 and 8.5 percent.
“Really, there is no reason not to consolidate immediately”, said Studer. “It’s a quick and simple process that will save the average borrower several thousand dollars over the lifetime of their loan. Plus, Congress voted to repeal the controversial single holder rule a few weeks ago, which had limited many borrower’s options to consolidate. Now almost everyone can shop for the best deal.”
ScholarPoint Financial, Inc. is a national online consumer lending company specializing in student loans and offering a full range of innovative education finance solutions. Loan options for students and their families include PLUS, Stafford, Consolidation and Private loans. ScholarPoint combines industry-leading borrower benefits, best-in-class service and innovative technology. Unlike many other traditional loan sites, ScholarPoint’s technology platform was designed exclusively for its website, integrating the entire process for an online experience that is simple, instant, and complete.
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