consolidation federal loan re student

Rates Increase July 1, but Last-Minute Applicants Can Still Lock ...

RESTON, Va., June 27 /PRNewswire/ -- Interest rates on federally guaranteed student loans will jump by nearly 2 percentage points this Saturday, July 1, but customers who submit their Federal Consolidation Loan application online by midnight (PDT) on June 30, 2006 can still receive today's lower interest rate. The forthcoming interest rate hike has caused record call volume to Sallie Mae's consolidation center from students, graduates and parents. To accommodate the call surge, Sallie Mae has added hundreds of customer service representatives responding to consolidation inquiries, and extended the operating days and hours of its phone hotline.

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"It is still not too late to lock in today's lower interest rates, but time is of the essence," said Patricia Scherschel, vice president of loan consolidation, Sallie Mae.

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THE COLOR OF MONEY: Deadline near for student-loan consolidation

WASHINGTON Just as hurricane season comes every year, so too does the quandary of whether students and their parents should consolidate student loans.

This year, the answer is fairly easy for most borrowers: Yes. The deadline for con solidating to get the best interest rates is June 30.

By law, interest rates on most existing federal student loans are variable and are calculated based on a formula that uses the interest rate of the 91-day Treasury bill set at the last auction in May.

That auction took place May 30. The interest rate for the one-year period beginning July 1 will be 6.54 percent for borrowers who are in school or in a grace or deferment status. Loans for borrowers in repayment will be set at 7.14 percent.

Although lenders make it seem as if consolidation is a no-brainer, I've received a number of e-mails from parents and students seeking a little more clarification.

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