<p>Is the interest rate for Federal Direct Student Loans determined by the year in which the loan was made or the year during which repayment commences. That is, will money borrowed this year be repaid at the current FDSL rate? Or, at the rate (presumably 8.25%) that is current when a student graduates? Thanks!</p>
<p>My daughter is paying 2.78% - I have no idea why. It changes every year, plus you get points off for never making a late payment, etc. I believe the original interest rate was for the year in which the repayment commences, since the rate adjusted yearly anyway based on <em>current</em> rates.</p>
<p>boxmaker: Your information is not correct. Please refer to many of the sponsers of this forum, salliemae, nellimae, citibank, usbank, bankone(JPMChase), and fafsa.com(s). Cross reference the websites to insure that you know that the information is same. (we use citibank with AES as the servicer, because AES manages all pennsylvannia loans regardless of lender. Its confusing but home mortgages work this way too.)</p>
<p>Alternatively you can try the websites of the schools that you are interested in and scroll to the Financial Aid listing. </p>
<p>There are also many threads in this category that rehash the websites and go into personal experiences. </p>
<p>Do a little reading at the sponsers site so that you can get a better understanding of the process.
GL</p>
<p>Itstoomuch, please forgive me for not understanding your response to my question. I did not provide information -- I asked a question which for reasons that are not obvious, provoked your somewhat testy response. </p>
<p>Since some people did not like the way I posed the question, let me try again: Let's say that a student borrows money under the Federal Direct Student Loan program. Is the amount borrowed that year repaid at the interest rate that was current during the year in which the money was borrowed? That is, are funds borrowed during 2005 repaid at current FDSL interest rate? Or, is the total loan repaid at the rate current at the time when repayment begins (presumably a higher rate)?</p>
<p>box: You still have not given enough information to directly answer your question. I therefore directed you to the source(s) of student loans inorder that you understand what type of loans are available and how they are paid back. The explanations are legally correct because they are federally guaranteed loans, and very nicely written. Enjoy. </p>
<p>Again please do a little research. When it comes to money, there are many parameters that can affect the outcome.</p>