I have a couple of student loans and I always get offers to consolidate and "lock in" an interest rate. What does this mean, and should I consider it?
200819
It basically means putting all your loans into one place and then you only pay one person the amount of the loan instead of paying several places.  It is worth considering but you must get a good deal before saying yes.
459550
It may be difficult to provide you with a more detailed answer based on the limited info given. Normally, you would shop around for lower rates at a financial institution, take out a loan for the total balance due on all your higher interest rate loans, and be left with one payment with a lower interest rate. In a sense, you would be saving money as compared to your current situation, but any interest rate charged for a loan is a cost. \n\n"Nothing in life is free ;-) "
609155
Be careful with consolidation.  By consolidating your loans, you may avoid the higher interest rate (and a few thousand dollars on the life of the loan) but you are giving up benefits like deferment and cancellation.  Please do some research and speak with your  student loan officer.\nI placed a few links below.  Many years ago, I had student loans and there was a point in time when I was grateful for the deferment option.  Life is funny, we plan, be we can't plan for everything.\n\n"You may give up some valuable features or benefits of your student loans by consolidating. Decide if you can afford to lose Perkins loan deferment or cancellation provisions or any other features or benefits of your particular loans."\n\n"If you hope to qualify for student loan forgiveness (  http://www.bankrate.com/brm/news/advice/college/20060519c1.asp   )  by pursuing certain public service careers, do not consolidate your Perkins loan. Only the portion of your Perkins loan that remains unconsolidated is eligible for forgiveness."\n\n\nIf you consolidate, you no longer have the 6 month grace period and you must begin payment of your consolidated student loans.\n\nPlease see this link for deferment summary. You never know when you might need a deferment.  \n\nhttp://studentaid.ed.gov/students/publications/repaying_loans/2003_2004/english/repayment-options-deferment.htm
259070
Hello!\n\nMy name is Earl Catlin a financial adviser for 4.0 student loans.  On July 1st student loan interest rates will be rising to 6.8%.  It is best that you consolidate now at a lower interest rate that will also put you at lower monthly payments. For more information visit www.40studentloans.com.  If you decide to apply use my name as your financial advisor and you will recieve a free iPod if approved.\n\nThanks,\n\nEarl Catlin
638899
the rate that it could adjust to is posted in your note! read your note. You need to refi this note to a fixed rate. With that start rate you must have had some credit issues. Start the process today. I am a loan officer in TN only>
582584
Student loan rates are reset every July 1st. Because central bank has been raising the interest rate over the last year, the student loan rate will most certainly increase as well comes July 1st.  Consolidation allows you to lock in the old rate for the life of your loan, so if you have a lot of loans, it may be worthwhile to consolidate before the deadline so that you can pay less in interest every month.  The only caveat is, you can only consolidate your loan once.  So if you consolidate your loans now, you will not be able to reconsolidate the rest of your loans after you graduate.  In my opinion, you should consolidate if you have a large amount of loans already.  This way, you will lock in the lower rate for the biggest chunk of your outstanding loans.  Conversely, if your existing loans is less than 50% of your total loan amount after graduation, you may want to wait to consolidate until after you graduate.  The rate may be lower then (remember, interest rates cycle up and down).
130045
Unsubsidized loans accrue interest the entire time you're in school (and every other time).  If you pay this interest as it accrues, you will save yourself some money in the long run.  If you don't pay interest while it accrues, when you graduate the accrued interest will be capitalized -- that is, it will be added onto the principal balance of your loan right before you enter repayment (and, if the lender wants, periodically after that).  This is what people mean when they talk about "paying interest on top of interest."\n\nIf you're not SURE if you want to do pay interest as it it accrues, you can always say "no" now.  if you have money to spare later on, you can send a check to your lender for whatever amount you wish (note: call/email them first to get the appropriate contact information and write a little note with the check so they know exactly what you want them to do with it.)
262738
M.K\n\nActually you can consolidate your loan with the government now http://www.loanconsolidation.ed.gov (Borrowers Services) and it's actually not as bad as you think. \n\nBefore you consolidate your loan check out the Borrowers Services and see if you can get a better rate. You can consolidate any amount even your $50,000 debt and its free to consolidate your loan!\n\nI know Salliemae is one of the best student loan consolidators but sometimes their rates can be a little high depending on your situation.\n\nDoesn't hurt to check them both out. Hope you get it worked out soon!
179414
Im guessing you got that notice in the mail from some consolidation company. If you've taken student loans, I would first consult with the financial aid office or the equivalent, or your personal bank and make sure it's not an adjusting rate as you pay it off.
670398
ok, stafford loans have a variable interest rate. this means that it can change every july 1. it's possible that in july 2007 the rate would drop or that it might rise again. by consolidating, you are avoiding the risk of higher interest rates. but, you lose your grace period and the possibility of the rate dropping lower than it is currently. im a financial aid officer, if you have questions, please feel free to email me.
202604
There are a lot of companies out there that do "consolidation" loans that I believe you are thinking about.\n\nThis type of loan often gives you enough to pay off all your smaller debts and can give you some extra money on top.\n\nNormally though they require collateral (IE a house) but a lot of the companies do take people with less than perfect credit history.\n\nStick on your TV and you'll soon find an advert for a company of this type.
290229
If you could provide a little additional information, that would help.  What kinds of student loans do you have?  Have they been consolidated? Are you a teacher?\n\nIf the loan is private, there isn't much that you can do to lower your rate -- most private loan rates are variable meaning that they change with the market and, sometimes, with your credit.  \n\nIf your loans are federal I have to ask: Are you sure the rate is 8.5%??  Federal Stafford loan interest rates have been capped at 8.25% for years.  And the only way your rate would be FIXED that high there would be if you had consolidated when rates were at an all-time high (the last time rates were that high was in 1999).  \n\nIf you haven't consolidated yet, consider doing it right away -- it's the easiest and safest way to (1) lower your monthly payments and (2) lock in a low interest rate while still maintaining the protection of the Federal student loan programs (just make sure you apply for a *Federal* Consolidation Loan).  When you consolidate, any eligible, Federal student loans that you have will be lumped into one new loan, your rate will be fixed at today's rate (5.3% if you're consolidating only Stafford loans) and your repayment term will be extended out beyond the standard 10-year repayment term (for a loan of $46,000, you will probably receive 25 years to repay). Extending your repayment term will mean that your monthly payment will be lowered (often significantly).\n\nIf you have consolidated, the only way that you can re-consolidate is if you...\n\n(1) borrow a *new* Federal student loan (probably not a wise decision, financially, as it wouldn't change your overall rate much)\n\n(2) if you "have been unable to obtain a Federal Consolidation Loan with income-sensitive repayment terms acceptable to [you]," you can obtain a Direct Consolidation Loan, which is the other type of student loan consolidation that the federal government offers. \n\nThis might be your best option. Just make sure that your current loan is a Federal Consolidation Loan (if it's already a Direct Consolidation Loan, you're out of luck). If it is, check the Dept. of Ed's website to see if you are eligible: http://loanconsolidation.ed.gov/borrower/beligible.shtml . There's no credit check on these loans, so it can't hurt to try!\n\nThere are private companies out there that claim to be able to "reconsolidate" any federal consolidation loan. These companies are SO disreputable that I hesitate to even mention them. DON'T DO IT. They're in business only to make money off of you. Many of them don't even deal in Federal Consolidation Loans, so you could end up with a "reconsolidated" private loan with horrible terms and none of the benefits and security of the Federal student loan that you started with.\n\nFinally, about student loan forgiveness: loan forgiveness is almost always not an option for someone who has consolidated, so you will need to make the choice between Loan Consolidation and Loan Forgiveness.  Before deciding, keep in mind two things: \n(1) interest rates are on the RISE and scheduled to rise to 6.8% in July, so if you want to consolidate, you should do it before July 1\n(2) Forgiveness (a.k.a. "cancellation") of Stafford loans is rare unless you are a teacher in a low-income area.  To see if you qualify for teacher forgiveness, read this site carefully:\nhttp://studentaid.ed.gov/PORTALSWebApp/students/english/teachercancel.jsp?tab=repaying\n\nBy all means, if you qualify, go for it!
343752
Consolidation is a good idea.....as long as you take this warning.\n\nOver the past few years, many people have gone to consolidation and home equity loans to try and cure their credit problems.  They take all their bills and combine them into one bill, which generally is going to be mean a lower monthly payment, but will take longer to pay off.  OK, so far so good.\n\nThe problem is that these people turn around and charge thing on their "now empty" credit cards.  The result is they are now twice the amount in debt.  They end up filing for bankruptcy.\n\nOver the past two years the vast majority of people who filed BK did it for that reason.  \n\nSo as long as you understand this trap, you will do ok.  Consolidate your loan, but STOP further credit spending.  Get rid of the credit cards and try to use all of your disposable income to get this new loan paid off.  \n\nOtherwise, start looking for a bankruptcy lawyer.
300644
Regarding those two low interest CC's, are those interest rates fixed for the whole term or do they expire on a date.  Read the fine print, I think you will see they expire from 6-12 months after you made the transfer.\n\nNow, if those interest rates are fixed, why would you trade those in for a higher interest rate?  Even the benefit of a tax write off doesn't justify it.  If your only reason for doing it is fear of a late payment triggering the penalty...then get diciplined!  Make sure the payments are sent!\n\nRegarding the other cards....\n\nLet me say that I'm in favor of balance transfers and debt consolidation.  BUT....the danger is that when you do it, you must dicipline yourself on your budget.  \n\nOver the past two years, thousands of people fell into the trap of consolidation. Then they turned around and ran up their credit cards again.  Now they have twice the debt!  It ended up with them filing for bankruptcy.\n\nIt sounds from the way you are talking that you are on that path.  So take my advice.  If you consolidate, cancel all your paid off cards and budget yourself!  Otherwise you will lose your Coop.  \n\nDon't play the balance transfer game!  It's going to ruin you.
657259
Consolidating your loans will have no bearing on your credit rating  - as long as you continue to pay on a timely basis.  If you've missed the lower rates over the last several years, act quickly and lock in a good rate if you can.\n\nBy the way, I would recommend if you can get away from Numb Nuts, I mean Nelnet, do so.  They are a big pain to work with.  I have found the Department of Education actually much easiler with Sally Mae a close second.  Good luck.
566887
I did.  You can usually get a much better (and fixed rather than variable) interest rate that way.  I am not sure what the cons are, I only know the pros.
191830
A Stafford loan is a low-interest federal student loan (currently 4.7% for student in school). This loan can be subsidized or unsubsidized.  In this case, say that a loan is subsidized means that the government is paying the interest on the loan while you are in school and during any periods of deferment/grace (i.e. if you apply for and are approved for an Economic Hardship Deferment once you enter repayment, your loan won't accrue interest during the deferment period).  If your Stafford Loan is UNsubsidized, that means that the government does NOT cover the accruing interest.  So, if you borrow $2500 your Freshman year, the loan will have accrued interest while you are in school such that, by the time you graduate, the amount you owe will be more like $2,750 (assuming a rate of 4.7% -- though Stafford rates will be fixed at 6.8% beginning July 2006). Interest really adds up -- but that's true of any loan.\n\nWhen you file the FAFSA to apply for federal aid, you will be applying for a generic Stafford loan.  Whether that loan will be Subsidized or Unsubsidized is something your school will determine.  Generally you can only receive a Subsidized Stafford loan if you show financial need.  If you don't show need, your Stafford loan will be Unsubsidized.  [There are some ways that a student can get both the full amount of their Sub and additional Unsub, but this generally involves being independent or being a dependent student whose parents have been denied a PLUS loan.]  Check with your school to see which you qualify for.  Stafford loans involve no credit check, so there's no harm in applying, see what you are offered, and then deciding if you wish to borrow.