consolidate graduate loan student

Students rushing to meet loan deadline

Students and graduates are running out of time if they want to refinance college loans before an interest rate hike this weekend.The federal government adjusts interest rates on its student loans each July 1 based on a formula tied to the yield on short-term Treasury bills.If loans are consolidated before the Friday at midnight deadline, the interest rates will remain fixed.A consolidation loan allows students to combine their federal loans into a single loan with one monthly payment.The variable rate on a common Stafford loan dipped to as low as 2.77 percent for students in the 2004-2005 school year and 3.37 percent for graduates already making repayments. Those rates rose last year to 4.7 percent for students and 5.3 percent for graduates.On Saturday, the rates will shoot up to 6.8 percent for students and 7.14 percent for graduates.

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Student loan interest rates set to increase

Today is the last day student loan holders will have to consolidate their debt without feeling the hit of the nearly 2-percent increase in interest. The Federal Stafford loan rate will rise 1.93 percent July 1 and parent loans for undergraduate students (PLUS) will rise 2.4 percent, marking the largest jump since 2000. The change stems from a new bill that was incorporated into the Deficit Reduction Act of 2005, S. 1932, according to a press release from the Montana Guaranteed Student Loan Program.Ron Muffick, director of business relations and programs for the MGSLP, said, "Because of the interest rate change effective July 1, I encourage borrowers to contact their lenders to explore all of the options for repayment including consolidation."The average student debt for a Montana borrower is $20,000, quite less than the national level of $50,000, according to the American Council on Education."The rate increases mean higher interest payments for students and graduates over the life of their loan," said Jim Stipcich, president of Student Assistance Foundation.

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