http://www.blogher.com/wsj-it-time-consolidate-student-loans Comments for "WSJ: Is It Time to Consolidate Student Loans?" en http://www.blogher.com/wsj-it-time-consolidate-student-loans <p>The Wall Street Journal wrote an <a target="_blank" href="http://online.wsj.com/article/SB119440232584384772.html?mod=hpp_us_personal_finance">excellent article</a> today talking about why it is probably a good idea to hold off on consolidating your federal student loans until July 1, 2008.</p> <p><strong>Why Wait?</strong> </p> <p>Current Stafford loan repayment rates are 7.22%. Alot of borrowers are eager to consolidate before their grace period is up to lock in the lower in-school interest rate in order to save .6%. This translates to a rate of 6.625%. But if the borrowers wait until July 1 of next year, borrowers would likely be able to lock in a consolidated rate of 6.5% or lower.</p> <p><strong>What Determines Federal Consolidation Rates?</strong></p> <p>The Education Department resets the interest rate on its Stafford and PLUS programs annually on July 1 using a formula based on the 91 day Treasury Bill. Since rates on the 91-day T-bill tend to closely reflect the fed funds rate, the Fed's recent moves to trim short termrates a total of 3/4 of a point should result in a lower interest rate. Of course, you also risk rates rising. But given the housing and credit crisis, that doesn't look likely. Though, you never know!</p> <p><strong>Please contact <a target="_blank" href="http://www.daseducation.com/">Dollars &amp; Sense Education</a> to bring our seminars to your company or organization!</strong><strong><strong> </strong></strong></p> <p><strong><a href="http://daseducation.files.wordpress.com/2007/10/d_s_education_logo.gif" title="d_s_education_logo.gif"><strong><img src="http://daseducation.files.wordpress.com/2007/10/d_s_education_logo.gif" alt="d_s_education_logo.gif" /></strong></a><strong> </strong></strong><strong></strong></p> <p class="pDsc">Dollars &amp; Sense Education - Raising Your Financial IQ!<br /> <a href="http://www.daseducation.com/">www.daseducation.com</a><br /> nicole@daseducation.com<br /> 215-499-3834</p> <p></p> http://www.blogher.com/wsj-it-time-consolidate-student-loans#comments Business, Career &amp; Personal Finance student loans Wed, 07 Nov 2007 08:23:43 -0600 NicoleM 29291 at http://www.blogher.com