<p>I just read an article that made me wonder if people with student loans won't get pinched by rising interest rates the way those with adjustable rate mortgages are. It was interesting enough that I wrote about it:</p>
<p>What do you think? I know a recent grad that might get hit pretty hard.</p>
<p>Anyone with education loan debt over $10,000 in federal Stafford or PLUS loans should absolutely consider consolidating their loans right now before July 1st rate increases take place. </p>
<p>Lenders are offering all kinds of incentives to use their programs to consolidate - reduced interest rates, princpal rebates,etc ---- the only thing you really need to beware of if you are considering consolidating your loans and someone is offering benefits - what do you have to do to earn the benefit and then what do you have to do the keep the benefit ? that is where they usually get you !! Just be an educated consumer - read the fine print - ask questions - and if you have loans don't wait - lock down your rate and consolidate them now - there are GREAT deals out there!</p>
<p>If your loans 15 gerand or so are consolidated in school with the direct loan people at 3.2% or so, with next years loans, 5 grand, still to go. They will be at 6.8%. When you get out can you still consolidate both loans with a lender for a rate somewhere between the two. With 15 grand at 3.2% consolidated is that rate locked in?</p>
<p>Once you consolidate you have locked in your rate - so if you consolidated while in school for the first $15,000 at 3.2% and then get more loans to finish out your education at 6.8% -- you can roll all these together for one big loan. Your interest rates will be the "weighted average of all the loans, rounded up 1/8th of 1%" - so bascially if you have $15,000 at 3.2% and add on an additional $5,000 at 6.8% your new loan of $20,000 will be around 4.25% or something around that amount and it will be a fixed interest rate.</p>
<p>Here's an update on this:</p>
<p>The deadline is on Saturday. Here's my latest (and last) post...</p>
<p>Your author of your quotation is incorrect. Please do more due diligence.
Immediate payments on consolidation is just one option, and which may be changed later.</p>
<p>I just posted this in the Parent forum. DS and I just attempted to consolidate his unsub and sub Ford stafford loans. We did the subsidized one and thought that we would be entering the second loan into the application as well (the unsubs one). That was not the case. Do we need to do two separate applications for this consolidation??? I'm really confused and so is DS.</p>