Many college students find that as they near or shortly after graduation that they are going to have to start making payments on all the student loans they have accumulated over the past several years. It is not uncommon for graduates to have four or more education related loans amounting to $50,000 or more. In many cases consolidating these loans will help lower monthly payments and may even lower interest rates. That is why it is so important to find good student loan consolidation advice.
Most people do not realize that Direct Federal Student Loan interest rates are tied to 91 day Treasury bills that the Treasury Department auctions off on a regular basis. The rate of interest on T bills at the end of June each year sets the interest rate for next year or until June 30th the following year. In recent months due to the mortgage crisis and the threat of recession the Federal Reserve has lowered the prime rate to close to 2%. As a result the prices at auction for T Bill should also be falling. It may be a wise decision to wait until after July 1st to apply for Direct student loan consolidation packages.
It is important that you do not delay after that date as it may take as much as 60 days for your Direct Consolidation Loan to be approved. If you are in school you may need to use the consolidation process to acquire additional funding for the coming school year. If you need these funds before the beginning of the next semester than you need to apply early.
You should understand that not everyone will qualify for a Direct Consolidation Loan. In many cases it will depend on the type of student loan and when the loan was granted. You must be a student and attending a Direct Loan university or college and you must have at least one Direct Loan or federal educational loan that was granted during the time you were in school. You really need to do your home work and seek qualified student loans consolidation advice at your university financial aid office.
Doing a good job of comparing the benefits and costs of your Direct Consolidation Loan may save you thousands of dollars over the life of the loan. Remember you will be paying on your student loans for many years to come. Negotiating for income sensitive payments or interest rates will become very important as you begin your tenure in the job market. Even a slight reduction in interest rates over a period of 10 years can yield big savings.
As you can see a Direct Consolidation Loan will in most cases be a good Idea. It may help you to manage your student loan debt and your budget when you first enter the job market when your income is low. In addition it may save you a substantial amount of money over the life of the loan. Again the key to success in this endeavor is good student loan consolidation advice.
