<p>Hello everyone, first post,though I have been reading this board for all most two years now. Anyway, my D will be in her second year of college this fall. We have a plus loan from last year from a local lender that the college used. I have a question regarding consolidation. I will most likely be taking another plus loan for the fall semester this year, though I don't know how much it would be, as the college has not given us the financial package for the 2006/07 school year. Is it possible to estimate what I will need, take the loan, and than consolidate the loan from last year; and what I will need this year, before the July 1 deadline. Thanks for any help, and I have enjoyed reading everyones posts on this site, quite educational.</p>
<p>It sounds like rates are going to be approaching 7% after July 1st. Thank you GW and the GOP. We are looking at consolidation for what we have now just because we don't want to face a 2% + increase AGAIN. We started at 2.9, now 4.7, not wanting to see 6.8.</p>
<p>And yes, I know in relative terms these percentages are actractive compared to credit loans elsewhere. However, student loans should by ALL MEANS necessary be kept at a low interest rate for this simple uneducated reason... these loans are helping create future taxpayers. The small percentage collected on student loans will be made up via taxation through a higher taxbracket these students achieve. </p>
<p>I think the government should be doing everything possible to create taxpayers. If giving people a break early on so they can attain a better career and thus pay more later during their actual career years, is a good thing.</p>
<p>My oldest D is entering her 4th year of a 5 year program.Last year we consolidated her first 2 year loans at 2.875%.She mentioned to me last night that maybe she should consolidate again so we called her loan servicer and asked if we could consolidate her 3rd year loan into her first 2 year consolidated loan.Yes we were told and the new consolidated rate was 3.50ish. If we hadn't consolidated we would have stayed at the 2.875% on the first loan but the 3rd year loan would have jumped up to apprx 7.50ish.So it makes sense to consolidate</p>
<p>Thanks for the reply guys, the problem I have, is my d will be a sophomore this coming fall. We only have one plus loan, but I will need another one for this upcoming fall semester. Can I take out the plus loan now for the fall, even though the college has not given us what amount we are required to pay for the fall semester. I can I estimate and take out the loan now, even though I have nothing in hand from the college saying what amount I will need.</p>
<p>Jingles - you cannot consolidate the loan/s for the upcoming year - as the $$'s have not been dispursed as of yet - you can ONLY consolitate the loans from last year. Consolidation is based only on loans that have already been dispersed.</p>
<p>You can consolidate the loans you already have to keep the lower interest rate - then you can consolidate again in the future - the rates have not been set yet for doing that tho.</p>
<p>Side note on PLUS loans: call me foolish or wise, but out of caution, I took ours out at the Fixed rate, even though it was higher.</p>
<p>Also, thanks be to God for the enlightened approach of the state of Massachusetts, which underwrites reduced rate loans through its MEFA program for all students attending college in Massachusetts, whether they're state residents or not.</p>
<p>Amen to MEFA.</p>
<p>HELP...DS tried to consolidate his loans online. He has both unsubsidized and subsidized direct loans...through the same lender....William D. Ford Federal Direct Loan Program. We have been paying the interest on his unsub. loans with checks to U.S Department of Education. Tonight we spent over an hour online trying to consolidate his loans. First we got to the lender section...that was confusing enough...it's William D. Ford Federal Direct Loans...but it seemed that there were two choices, one for subsidized and one for unsubsidized. DS put the info in for the total loan amount...but truthfully it was so confusing that we exited out before he signed with his PIN. He did not submit it. At this point we are mighty confused. I'm looking at the the most recent disbursement notice. It says Direct Loans, William D Ford Federal Loan Program. No other lender is indicated. Do you have to apply consolidate these loans separately? Why does this seem to be so confusing??? We don't want to do it incorrectly...any suggestions?????</p>
<p>Thumper, I can't help you but there's confusion here too. D has only subsidized loans but it took a conversation with MEFA told D that the "lender" should be "Direct Loan." Okaaaaaay. (Private LOL at D having to deal with customer service.) </p>
<p>Then it turns out that MEFA has just changed its policies and the minimum loan balance for consolidation has been lowered from $7,500 to $5,000...but their on-line computer system won't yet accept a number lower than $7,500 for aggregate loan amount. A supervisor is supposed to call D tomorrow. </p>
<p>Jingles, I think you can take out the new PLUS loan now but it won't be disbursed until the Fall semester starts. It will be "in your account" but not yet credited to the school until then (usually half the loan per semester). Hmmm...I don't know if you can consolidate a loan that has been awarded you but not yet credited by the school. Sounds like another case for talking to a live human bean.</p>
<p>You CANNOT include an upcoming loan - it MUST have been dispursed to be included - loans for 2006 - 2007 school year cannot be included in any consolidation - as they have NOT been paid out to anyone as of yet - won't be paid out to the school until fall/spring. Hope that explains it.............</p>
<p>Well, I suspected as much. Thanks, JM.</p>
<p>My political gut says that all this stuff will change again in a few years. Whether <em>we</em> get to benefit or not is another story.</p>
<p>We are all set here. DS called the customer service number and did it all on the phone. It turns out that he had done most of it correctly online (but who would have been able to figure THAT out??). There was a number on the back of the interest statement that said "to consolidate loans call this number". DS did that and they did most of it over the phone. They will be mailing him the promisory note to sign. The rate is locked in as he completed his application before July 1. I would suggest calling the lender directly. It sure beat the online filing which was less than "user friendly", in my opinion. Oh...DS was told that all loans currently held by that lender would be consolidated. He only has one lender...ta da.</p>
<p>I was told that when a student graduates - who has consolidated now - they will be given another chance to consolidate again - but the rates have not yet been set for that scenerio.................. more to come.</p>
<p>My loan provider said that consolidation requires me to waive the grace period that I get after graduation. So instead of having six months to repay, I'll have to start repayment while I study for the bar. Heaven only knows how anyone would manage that - I would have to take out another loan for that nonsense.</p>
<p>Read that fine print carefully. For many students, it may not matter (on a $10,000 loan, it can be about $100/month, which they can earn at the ice cream store); however, for grad students with heavy loan debt or law students who need to be licensed before they can earn money, the removal of those grace periods just doesn't work.</p>
<p>Yeah, D told me about the grace period disappearing. For these loans, I think it's doable. No grace period = better than having payments 30 percent higher for a long time, imo.</p>
<p>Remember that if you lose the grace period and begin your payments six months earlier, you will be finished paying off the loan 6 months earlier and if your loan is unsubsidized, sooner is better.</p>
<p>There are also options to begin lower payments that rise after a period and I there are student deferments and I think easy pay back options for people who are low income. It pays to check into it and find out what applies in your individual situation.</p>