Graduates should look at details for each student loan By Kara McGuire
Drew Sandquist looks forward to finishing his master's degree in advocacy and political leadership at the University of Minnesota Duluth . What he's not excited about is what inevitably comes with the end of his scholarly era: Repaying about $50,000 in student loans.
Lenders are eagerly courting 24-year-old Sandquist's business, peppering him with up to 10 offers per week to consolidate his student loans, promising $25 gift certificates just for calling, and $3,000 cash rebates.
But he's wary of the offers. "I'm not sure whether they'll have my best interests in mind," he wrote in an e-mail. That's especially so after all the news about lenders giving improper perks to some colleges in attempts to influence the schools' preferred-lender recommendations.
Former students thinking about consolidating their loans will save a little money if they act before July 1. Earlier this week, the Department of Education announced that after July 1, the rates on variable-rate Stafford loans and parent PLUS loans will increase slightly - from 7.14 percent to 7.22 percent for federal Stafford loans in repayment and from 6.54 percent to 6.62 percent for students still in their grace period (typically the six months following graduation).
Consolidation was the in thing a couple of years ago when rates were at historic lows. Today, consolidation is not the good deal it used to be. Loan rates have doubled, and since last July, federal loans are issued at a fixed 6.8 percent rate. That said, student loan consolidation is still worthy of examination.
Source:
http://www.thesun.co.uk/article/0,,2005300000-2007250774,00.html
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