auto loan for college student
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MONEY | Cutting college loan costs
Rates on federally sponsored college loans are scheduled to increase Saturday, and consolidating existing loans will become less advantageous then. -Many borrowers can get discounts such as a quarter-point reduction in the interest rate for paying by automatic debit and another one-point reduction in the rate after they make 36 on-time payments. On a $30,000 consolidation loan, that would save an additional $6,000 over 20 years.
-Some families might find it cheaper to borrow money by taking out a second mortgage or home-equity credit line, or to lower the payment by extending an existing loan.
-To learn more about federal student loans, see the Department of Education's Web site at .gov. For details on consolidation loans, see Sallie Mae's Web site at www.smartloan.com.
More auto loan for college student info
Fixed-rate college loans don't preclude shopping
Beginning next month, the two largest federal college-loan programs, Stafford and PLUS, will go from variable to fixed interest rates. Still, you should shop around for student loans.
Lenders can't go higher than the fixed interest rate: 6.8 percent for Stafford and 8.5 percent for PLUS. However, they can go lower; many will, in the name of competition for students' business.
Many lenders will reduce the interest rate by 0.25 percent if they can automatically withdrawal loan payments from a customer's bank account.
Sallie Mae and My Rich Uncle Student Loans are just two companies that have special offers.
When looking for a good rate, students should first check their schools' list of preferred lenders.
Students who go to a school that is not a member of the Federal Family Education Loan Program cannot shop around.