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As July 1 Deadline Nears, NextStudent Offers In-School Consolidation as low as 2.5 Percent

BY Jeff Mictabor

As July 1 Deadline Nears, NextStudent Offers In-School Consolidation as low as 2.5 Percent
In less than three weeks on July 1, 2006, student loan ( http://www.nextstudent.com ) borrowers no longer will be able to consolidate their student loans at the current low interest rates, as an increase of 1.84 percentage points will take place. The increase was revealed May 30, 2006 at the auction of 91-day Treasury bills.
Student loan (http://www.nextstudent.com/consolidation_loans/consolidation_loans.asp) borrowers are rushing to consolidate their student loans in an effort to beat the second-largest rate hike in the history of the student loan program. Through consolidation, borrowers can receive a low interest rate after their outstanding loans are combined into one, according to Phoenix-based NextStudent. The premier education funding company offers an array of student loan programs and specializes in consolidation.
July 1 Deadline Nearing
Since the U.S. Department of Education allows for in-school consolidation at lenders' discretion, those college students currently in school have until July 1, 2006 to consolidate their loans. The program no longer will be available after that date.
NextStudent is a long-established student loan company and is among the lenders now participating to help students with their in-school consolidations. Through the program, a lender holding original loans discharges those loans to other lenders. This then allows borrowers to consolidate. Approximately three or four lenders do not take part in the in-school consolidation process.
NextStudent Offers 4.7 Percent Rate
A 4.7 percent in-school fixed consolidation rate - and sometimes a rate as low as 2.5 percent - most often is available through NextStudent. The low rates no longer will be available after July 1, 2006, when the rate possibly could go as high as 7.25 percent.
There are some student loan (http://www.nextstudent.com/consolidation_loans/consolidation_loans.asp)borrowers who are leery of in-school consolidation, as they are not aware of the facts regarding the program. With in-school consolidation student borrowers sign a waiver giving up their grace period. The in-school loans then are put into immediate repayment.
Student loan (http://www.nextstudent.com)borrowers should note that they do not have to begin making payments while they are in school. An in-school consolidation takes up to six weeks to complete. After completion, a borrower's loans then return to in-school deferment, meaning payments can be made following graduation. An advantage is that graduated borrowers can take up to six years deferring payment.
Other Interest Rate Increases
On July 1, 2006 other expected interest rate increases include those for Stafford loans and PLUS loans. A new fixed rate of 6.8 percent will be in effect for Stafford loans disbursed on or after July 1, 2006, and a new fixed rate of 8.5 percent will be in effect for PLUS loans disbursed on or after July 1, 2006.
Other eligible student loan borrowers looking to consolidate with NextStudent can receive a 2.5 percent interest rate, with benefits applied, including: .60 percent rate reduction for consolidating following graduation, .25 percent rate reduction with use of Auto Debit, and an additional 1 percent rate reduction after making 36 consecutive on-time payments.
NextStudent's federal student loan (https://www.nextstudent.com/consolidation_loans/apply-online/apply-online.asp) consolidation program is free and there are no hidden costs or prepayment penalties. By working one-on-one with a knowledgeable education finance adviser, students receive top-notch service and can feel secure knowing their information is secure and confidential.
When borrowers consolidate they can receive a low interest rate that stays locked for the life of the loan, extended payment terms and a savings of thousands over the long term. With less than three weeks remaining until the rate increase, now is the time for student loan borrowers to receive the lowest possible interest rate.
NextStudent believes that getting an education is the best investment you can make, and it is dedicated to helping you pursue your education dreams by making college funding as easy as possible. Learn more about Student Loans at http://www.nextstudent.com/.

Jeff Mictabor is an enthusiast on the topic of student loan issues in the news. He has been writing for the past 10 years for a variety of education publications. He now offers his writing services on a freelance basis.

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