Student Loan Financial Group , the premier financial center specializing in Federal Student Loan Consolidation , today announced that interest rates on existing variable-rate student loans will climb eight basis points, or .08 percentage points July 1, 2007. While interest rates on new Federal Stafford and PLUS loans are fixed under federal law, students, graduates and parents who have older, variable-rate student loans can take advantage of the lower rate if they apply for student loan consolidation by June 30.
Most federal Stafford and PLUS loans first disbursed before July 1, 2006 charge variable interest rates that are set by federal formula and based on the last auction of 91-day U.S. Treasury bills in May. Interest rates on loans disbursed after that date are fixed at 6.8 percent (Stafford) and 8.5 percent (PLUS).
"This Spring 2007, college grad's who still have variable rate loans may consider applying to consolidate before their six month, post grad grace period ends," said John Wrinn, President, Student Loan Financial Group. "Students can lock in a lower rate if they lock the rate prior to June 30th. Also, parents with PLUS loans will save an eight of a percent by consolidating before July 1st, instead of waiting.
When a student decides to consolidate their student loans, the loan consolidation lender pays off the student's current federal student loans in full and creates a new loan, with a new interest rate and a longer repayment term. Federal student loan consolidation has a fixed interest rate, based on the weighted average of the interest rates of the student loans being consolidated, rounded up to the nearest 0.125 percent or 8.25 percent, whichever is less.
For existing Federal Stafford and PLUS loans that still carry a variable interest rate, the interest rates as of July 1, 2007 will be:
Stafford Loans (in school, grace and deferment periods): 6.62 percent
Stafford Loans (repayment): 7.22 percent -- PLUS Loans: 8.02 percent
In addition, there is no credit checks, no fees, no prepayment penalties as well as student loan consolidation can reduce the monthly payment amount by nearly 50 percent. That is because student loan consolidation stretches the repayment period from the standard 10 years to up to 30 years, depending on the amount of the education debt.
Student and parent customers who consolidate their Stafford, PLUS and other eligible federal student loans using a Student Loan Financial Group Consolidation Loan can also reduce their interest rate by an additional 1.25 percentage points by making scheduled loan payments on time, and by using automatic debit to make payments electronically. Combined, these benefits can provide the average customer with $4,300 in savings on a $20,000 loan.
About Student Loan Financial Group
Student Loan Financial Group (SLFG) is a premier loan service that guides clients through the options and choices of student loan financing with ease and simplicity. Headquartered in Baltimore, Maryland, SLFG specializes in student loan consolidation and has helped thousandths of students fulfill their ambitions of high education. Through an extensive network of highly specialized products, SLFG offers low rates, great borrower benefits and the best options available to solve a wide-range of consumer-financing needs. SLFG was incorporated as a privately held company in 2006; all of its shares are currently held by officers and employees.Labels: academy awards, career training, financial aid, free college, free education, high school, scholarship, student loans, study abroad |
