should I consolidate my student loans?

Your 5% you are getting paid for you will be higher than the federal student loan rate even after it goes up in July. Its probably best not to consolidate as long as you are getting that 5% from your school.

Sorry, should have asked if the school will still pay that 5% after you consolidate. If that would be the case then go ahead and consolidate.

Also, how much in loans do you have and what is your term? If you forsee yourself with the same company for a period longer than the term of your loan then simply do the math (I'd assume a 7-8 percent interest rate on the loan in the future if you do not consolidate). As the previous poster said, if your company will pay the 5 percent even after you consolidate it is a no brainer.

in most cases, it's a no brainer. lower rates are almost always good. unless there are some special circumstances, do it.

Okay, I just checked the percentage of loan forgiveness. For my Perkins Loans (which are about 5,000 total) the rate of forgiveness is 15% for the 1st and 2nd years, 20% for the 3rd year and 30% for the 4th and 5th year at a low income school.) I presume I will continue teaching at low income schools. Most of the schools in my state are. SO- should I just consolidate the additional 15,000 worth of Stafford Loans and keep the Perkins separate since I can get the deductions? Thanks for all of the help.

This is funny you ask because today I was wondering the same thing. For the last few months I get mail EVERYDAY telling me to consolidate my loans and "get locked in" to a low rate. The thing is, I thought I already had a pretty low rate that was fixed.

Right now it's saying rates go up july 1st. I swore a few months ago it was a different deadline. I imagine after july 1 passes it'll have an even later date.

Are these scams? Well not necessarily scams but there's gotta be a catch. Right? I have no clue what to take seriously and what to ignore. I have a feeling these are a bunch of salesmen i should ignore. But if not feel free to chime in and give me your expertise.

very very curious wrote:

This is funny you ask because today I was wondering the same thing. For the last few months I get mail EVERYDAY telling me to consolidate my loans and "get locked in" to a low rate. The thing is, I thought I already had a pretty low rate that was fixed.

Right now it's saying rates go up july 1st. I swore a few months ago it was a different deadline. I imagine after july 1 passes it'll have an even later date.

Are these scams? Well not necessarily scams but there's gotta be a catch. Right? I have no clue what to take seriously and what to ignore. I have a feeling these are a bunch of salesmen i should ignore. But if not feel free to chime in and give me your expertise.

If you're locked in, you're locked in. If you have questions, dig out the paperwork from the original company and call them.

The mail you get is from other companies trying to buy your loan. They have no idea whether or not you've consolidated, they just know that you're recently graduated.

I consolidated in Dec 2002 and I still get crap from companies, only because I just finished my MS (from which I have no debt).

I'm at 2.6%, which is about the lowest I've seen yet.

i got an email from my university suggesting that i consolidate mine so i doubt its a scam.

anything else?

any additional info?

I thought that same thing for a while. Consolidating my loans I mean. I talked it over with a bunch of different people and I got this: interest rates, although the lowest they have ever been, aren't going to sky rocket on the 1st of July. Take this senerio...you consolidate now and on July 1st they actually go down, then you are kicking yourself in the ass. Of course what happens if they go up(?)...they aren't going to sky-rocket! The "interest rate" experts have been wrong everytime according to my sources, they are worse than weathermen. There is also one more thing to take into account. If you just graduated and you aren't going to go back to school and...if you choose to consolidate, you'll forgive your "6-month" grace period. Very important to know!

I just don't see the interest rate going any LOWER than it is right now. I mean, it seems as close to 0% as it will ever get and there's a big difference between 3% and the 8% maximum in the worst case scenario.

I knew there was a catch! Always is.