Consolidating After July 1 May Save You Thousands

The rates are in, and as expected they have dropped like a second rate fighter in a Vegas prize fight.

The rate decrease will not effect everyone however. Only those who hold federal loans with varialble interest rates are doing a little dance today. If you have fixed interest rates, and many do, you are out of luck.

The rate decreases effect those who secured federal loans PRIOR to July 1, 2006. After that date a fixed model was put into place. Of course if you had loans from prior to July 1 2006 and already consolidated you are also out of luck as you inherited a fixed interest rate at that time.

So what have the rates fallen to? Drum roll please…

Stafford In Grace rate: 2% (down from 3.61%)

Stafford In Repayment rate: 2.5% (down from 4.21%)

Parent Plus Loan rate: 3.38% (down from 5.01%)

Start your application for federal loan consolidation.

Federal Consolidation is easy as 1-2-3

Given the interest rate drop which takes effect Wednesday, July 1 I’m expecting next week to be a busy consolidation week. Save yourself some frustration by having everything in front of you ahead of time. By the way, to find out if the rate drop impacts you or what the new rates are going down to you can read Consolidating After July 1 May Save You Thousands for more details.

Here is a punchlist of what you’ll want in front of you when you sit down to consolidate your federal loans, and what choices you will need to make.

1. 4-digit FAFSA pin number

2. Loan details such as servicer, disbursement date(s), and current amount owed

3. Know which loans you want to consolidate and which you don’t

4. You will have multiple repayment plans to select from which include standard, graduate, extended, income-contingent or income sensitive, and income-based

Keep in mind if you are enrolled in school half-time or greater as defined by the school you are not eligible for consolidation at this time. You will need to wait until you fall below half time status or graduate.

If you have other debt you need to consolidate such as credit cards, personal loans, utility bills, and cell phone bills get a free debt consultation quote today.

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How Student Loan Consolidation Works

We are here to make the student loan consolidation process easy by providing information and support via the web and phone. The following step-by-step guide will help you understand how consolidation works and how it will benefit you for years to come.

Step 1: Apply for Consolidation

The first step in consolidating your student loans is applying for a consolidation loan using our free, no-obligation application form. When you apply, you'll have the choice of receiving an application and information packet via eSignature or postal mail. Your packet will contain a consolidation application, as well as information about your discounts, and details on how your interest rate is computed.

Step 2: Locate Your Student Loans

As a result of recent changes at the Department of Education, you'll need to provide your student loan information with your consolidation application. There are several ways that you can locate your student loans and our loan counselors will gladly walk you through each process.

Step 3: Sign and Mail

Once you have reviewed the promissory note, and understand the terms, you will sign and return it to us. Either by eSignature online, or by sending the paper application back in our pre-paid envelope.

Step 4: Application Processing

Upon receiving your signed application, your loan counselor will check the application for errors. We also check to make sure it complies with all federal guidelines set forth for federal loan consolidation. This ensures that your application is completed quickly and accurately.

After your application is submitted for processing, the loan retrieval" begins. We contact your lenders for the exact amount you owe; this information is sent to us on a loan verification certificate, or LvC. This process can take up to 60 days depending on the response time from your lender(s). Once we have valid LvC's from your lender(s), we will send them a check for the balance of your student loans.

Once the check is sent to your lender(s), your loans have officially been consolidated. You will receive a new statement from us detailing when your first payment is due, and when each payment is due thereafter. Your previous lenders can take a week or two to close out your accounts, so do not be alarmed if you get a statement from us, and a statement from your old lender. This is normal.

Your first billing statement from us will include the automatic checking account withdrawal enrollment form. It will also include information on any other discounts you are eligible for. Your previous Stafford loans are paid in full.

Federal Student Loan Consolidation?

Federal student loan consolidation is a fixed-rate refinancing program that combines all of your existing federal student loans into one new loan.

Consolidation is a great tool for managing your finances - providing immediate payment relief and long term benefits. With our fast and convenient eSignature, your application will be complete in just a few minutes.

• Cut your monthly student loan payment by as much as 50%
• Simplify your finances with one monthly payment
• No credit checks, fees, or application charges
• Reduce your interest rate 0.6% by consolidating during your grace period