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Federal Loan Consolidation
- Effective July 1, 2006 the variable interest rates on federal student loans for students in their grace period is 6.54%* For students in repayment the rate is 7.14%
- By consolidating your federal loans you could potentially lock in a fixed interest rate as low as 6.625%.
- Apply today to ensure that you will be able to lock in this year's lowest fixed rate with lower monthly payments
For loans disbursed between July 1, 1998 and June 30, 2006. Loans disbursed before this period have a slightly higher rate.
Recent Articles Regarding Consolidation of Student Loans
Forbes.com June 13, 2007
http://www.forbes.com/
John Hopkins University April 24, 2007
www.jhunewsletter.com
NBC News, Charlotte, NC April 12, 2007
www.prnewswire.com
Cleveland State University, April 30, 2007
www.csucauldron.com
National Financial Awareness Network, Inc., June 12, 2006
http://www.pr.com/press-release/12106
KRON San Franciso May 17, 2006
http://kron.com/Global/story.asp?S=4915628
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Eligibility
You are eligible to consolidate all or any combination of your loans providing you
- You have a balance over $10,000
- Are separated from School (This does not apply for Parent Plus Loans)
- You are in your Grace Period or in repayment
- You have not consolidated before (This does not apply if you have a new federal loan to add to your already consolidated Loans)
- You have multiple Lenders/Servicers.
- You are not in default. (no payment made for 270 days)
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Eligible Loans
The following loans are eligible for Federal Loan Consolidation with Collegiate Funding.
- DSS- Direct Subsidized Stafford Loans
- DUS- Direct Unsubsidized Stafford Loans
- DPLUS- Direct PLUS Loans
- DUCON- Direct Unsubsidized Consolidation Loan, including Direct PLUS Consolidation Loans
- SS-Subsidized Federal Stafford Loans, formerly Guaranteed Student Loans (GSL)
- US - Unsubsidized and Non-subsidized Federal Stafford Loans
- NSL-Federal Nursing Loans
- PERK- Federal Perkins Loans, formerly Nations Defense/National Direct Student Loans (NDSL)
- PLUS- Federal PLUS (Parent) Loans
- SCON- Subsidized Federal Consolidation Loans
- UCON- Unsubsidized Federal Consolidation Loans
- SLS- Federal Supplemental Loans for Students (formerly Auxiliary Loans to Assist Students (ALAS) and Student PLUS Loans)
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Interest Rates
If you consolidate today, you can lock in an incredibly low interest rate for the life of the loan.
Consolidation loan interest rates are based on a weighted average of the rates on your existing loans. The lower your original interest rates are, the lower your consolidation interest rate will be.
Once your consolidation loan is disbursed, you'll lock in a weighted average of these low rates for the life of your loan. Consolidation will save you a significant amount of interest charges during the life of the loan.
The interest rate on your Federal Consolidation Loan is calculated on the weighted average of the current interest rates based on the loan disbursement date.
| CURRENT STAFFORD RATES* |
| Loan Date | Grace Period | Repayment |
| 7/06-6/07 | 6.80% | 6.80 % |
| 7/98-6/06 | 6.54% | 7.14 % |
| 7/95-6/98 | 7.34% | 7.94 % |
| 7/92-6/95 | 7.94% | 7.94 % |
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| LAST YEAR’S STAFFORD RATES |
| Loan Date | Grace Period | Repayment |
| 7/98-6/06 | 4.70% | 5.30 % |
| 7/95-6/98 | 5.50% | 6.10 % |
| 7/92-6/95 | 6.10% | 6.10 % |
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| CURRENT PLUS RATES* |
| Loan Date | Repayment |
| 7/06-7/07 | 8.50 % |
| 7/98-6/06 | 7.94 % |
| 7/95-6/98 | 8.10 % |
| 7/92-6/95 | 8.25 % |
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| LAST YEAR’S PLUS RATES |
| Loan Date | Repayment |
| 7/98-6/06 | 6.10 % |
| 7/95-6/98 | 6.50 % |
| 7/92-6/95 | 6.50 % |
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*Interest Rates effective 7/1/05-6/30/06
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Repayment Plans
Three repayment plans are available with Federal Loan Consolidation.
Standard Repayment Plan
This plan allows for standard, equal monthly payments. The length of the term depends on the loan balance (see chart below). There is no prepayment penalty if you pay early.
2-Year Graduated
This is a good option for recent graduates. Payments start out small for the first two years and gradually increase over the course of the repayment period. Selecting this repayment option may increase your overall interest costs.
Income-Sensitive
This plan establishes payments annually based on your expected monthly income. Wage documentation must be provided before a repayment schedule can be determined. Selecting this option may increase your total interest costs over the term of the loan.
Extended Repayment If your loans exceed $30,000 you have the option of extending repayment over a 25 year term with either the fixed or graduated payment plan. If you have at least $40,000 in debt you qualify for a 25 year repayment plan.
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Payment Terms
| Loan Debt | Repayment Term |
| $10,000 to $19,999 | Up to 15 years |
| $20,000 to $39,999 | Up to 20 years |
| $40,000 to $59,999 | Up to 25 years |
| over $60,000 | Up to 30 years |
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