Thursday, November 02, 2006
Wednesday, October 25, 2006
Student Loan Consolidation
What is a student loan consolidation? A student loan consolidation is when a company decides to pay off one or more of your student loans for you, and assume the debt, so that they are your new lender. Usually, this facilitates an interest rate swap from floating to fixed, and/or a lower interest rate.
There are two types of student lending available in the United States:
* Federal Student Loans, which can be made to students or parents
* Private Student Loans, which can also be made to students or parents
Federal student loans in the United States are authorized under Title IV of the Higher Education Act, and have a six month grace period to begin repayment after graduation. The loans may be subsidized or unsubsidized, meaning that interest will accrue will in school. Clearly, having the government pay your interest is a good thing!
In July 2006, there was an impending interest rate hike. For those of us whose Federal loans were variable rate, it was a good idea to consolidate loans and lock in the lower interest rates. The two best resources for applying for loan consolidation were:
* Direct Consolidation Loans
* Sallie Mae
It will be a while before you need to do this, but keep the following in mind–for half an hour of your time filling out forms, you could save thousands of dollars in interest repayments!
There are two types of student lending available in the United States:
* Federal Student Loans, which can be made to students or parents
* Private Student Loans, which can also be made to students or parents
Federal student loans in the United States are authorized under Title IV of the Higher Education Act, and have a six month grace period to begin repayment after graduation. The loans may be subsidized or unsubsidized, meaning that interest will accrue will in school. Clearly, having the government pay your interest is a good thing!
In July 2006, there was an impending interest rate hike. For those of us whose Federal loans were variable rate, it was a good idea to consolidate loans and lock in the lower interest rates. The two best resources for applying for loan consolidation were:
* Direct Consolidation Loans
* Sallie Mae
It will be a while before you need to do this, but keep the following in mind–for half an hour of your time filling out forms, you could save thousands of dollars in interest repayments!
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