Consolidate to Cut Your Interest Rates on College Loans The Department of Education estimates that approximately 16 million people owe about $250 billion in student loans. Two out of every three full-time college students borrows money to pay for their education, according to the Lumina Foundation for Education, an Indianapolis-based nonprofit organization working to expand educational opportunities for students. Lumina estimates that people graduating from college this year are on average $17,000 in debt, if they went to a public school or university, and $19,000 in debt for private college education. If you are one of those people, take note of new lower government student (Stafford) loan rates, taking effect on July 1, which are expected to drop to between 4 to 4.5 percent (down from 5.9%). Experts advice that a smart move right now would be to consolidate your higher-priced loans at this rate. You have until July 1 of next year to take advantage of the new lower rate. However, since the process can take weeks, itâ??s recommended that you apply several months before the deadline. Visit www.finaid.com for more free information on student financial aid. The site includes a nifty, free scholarship search function. From the Making Bread Mag
ohnostuck the exact rates are as follows: 1) If your Stafford loan, either subsidized or unsubsidized, was originally dispersed after July 1, 1998 then your new rate is 4.06% if you are in repayment or forbearance. 2) If your Stafford loan, again either subsidized or unsubsidized, was dispersed between July 1, 1994 and June 30, 1998 then your new rate is 4.86% if you are in repayment or forbearance. There are exceptions to the above rates if you have an in-school or deferment for any other reason. These rates are effective from July 1, 2002 through June 30, 2004. Good luck to all student loan holders. fla-tan
