Loan Repayment

Dear In-School Students,

• Consolidate your Stafford student loans by 6-30-06 in order to lock this year’s interest rate. 
• In-school students may consolidate if they agree to waive the six-month grace period.  Payments will still be deferred during periods of at-least-half-time school enrollment.  It is worth losing a grace period in order to lock a lower interest rate!
• Interest rates on in-school, in-grace Stafford loans are at 4.7% until 6-30-06 (4.75% when consolidated); the rate jumps to 6.54% on 7-1-06.  
• If you do not consolidate your student loans by June 30^th it will be too late to lock this year’s interest rate.
• Contact your Stafford loan lender for a consolidation application.  Most lenders have the application online (for Naropa as lender go to www.collegeinvest.org, for Citibank go to www.studentloan.com).  Keep a copy of your application. 
• Don’t know your lender?  Look up your loan history at www.nslds.ed.gov.  You’ll need your FAFSA pin #.  If you’ve lost your pin # go to www.pin.ed.gov. 
• What difference does the interest rate make?  For example, a $25,000 loan at 4.75% and 20 years of repayment will charge $13,774.40 in interest; at 6.5% the interest would be $19,733.60.  The lower interest rate saves the borrower $5,959.20 in interest.
• Did you already consolidate last year (before 7-1-05)?  Great!  You should still consolidate again in order to get your 2005/06 Stafford loans locked before their rate goes up.  You can include last year’s consolidation in this year’s consolidation if you want to.  The final interest rate will be a weighted average.  You can calculate the rates, payments, and total interest at www.cslf.com/ConsolidationCalculator.htm
• Our “Plain English Explanation of Consolidation Loans” appears below. 
• This is the last year that in-school students will be allowed to consolidate and Stafford loans that are disbursed after 6-30-06 will have a locked rate of 6.8%.