Loan Programs

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  • Get Smart About Consolidation

    Consolidation is available on both federal and private student loans, but federal student loans and private student loans may not be consolidated together.

    However, before a borrower decides to consolidate, you should look closely at what student loan consolidation actually is to determine if it is the right decision for you.

    Keep in mind that you normally will not be able to consolidate your loans until after you graduate or withdraw from school. If you choose to consolidate your loans, you may be able to extend your repayment period from 10-25 years up to 30 years. This will reduce your monthly payments, but will greatly increase the total amount of interest you will pay over the life of the loan. On the other hand, if one lender holds all of your loans there is a good chance that you may be able to obtain an extended repayment period without consolidating your loans by consulting with your lender.

    Please note, variable rate Stafford and PLUS loans (those disbursed between 7/1/98 and 6/30/06) will have their interest rates reset to the following historic low rate on July 1, 2009:

    Stafford (in repayment or forbearance): 2.48% (in-school, grace, or deferment): 1.88%

    PLUS (in all status): 3.28%

    Stafford and PLUS loans disbursed after June 30, 2006 remain at their current fixed rates. Please check with your lender(s), if you are unsure of interest rates on your various loans.

    In an effort to assist in your decision process, we have provided consolidation pros and cons:

    Consolidation Pros (reasons to consolidate):

    • reduce monthly payments with an extended repayment period
    • make just one payment to one lender/servicer each month (if you have multiple lenders) there is no charge to consolidate (it’s free) you may choose which loans to consolidate (you do NOT have to consolidate all loans)
    • lock in on a low fixed interest rate, if currently have variable rate loans

    Consolidation Cons (reasons NOT to consolidate):

    • prolong the life of your loan (potentially paying more interest over the life of the loan)
    • forfeit original repayment incentives
    • possible elimination of deferment options
    • potential loss of grace period
    • potential loss of loan forgiveness option on Stafford and Perkins if consolidated

    For Federal Direct Loan Consolidation, please click here