So you've racked up thousands of dollars in student loans. Graduation is barely in your rear-view mirror, and the student loan companies are contacting you weekly about your soon-to-begin repayments. And if you didn't have enough on your mind already, we have to inform you that interest rates on variable student loan products just went up as well. Despite the increasing costs of higher education (and your burning desire to pursue graduate school) our federal government has a multi-trillion-dollar national deficit to repay...and apparently Uncle Sam's target is our nation's college students.
What's New
As of July 1, 2007, the interest rate on Stafford loans in repayment increased from 7.14% to 7.22%. The interest rate on in-school, grace, or deferment status Stafford loans went from 6.54% to 6.62%. And the rate for PLUS loans jumped from 7.94% to 8.02%. These rates will be in effect through June 30, 2008. The Department of Education sets the rates once each year based on the last three-month Treasury bill auction held in May.
These new rates apply only to loans issued on or after July 1, 1998 and before July 1, 2006. For all Stafford and PLUS loans issued on or after July 1, 2006, the loans will have a fixed interest rate--6.8% for Stafford loans and 8.5% for PLUS loans.
Keep Your Promise to Repay
Student loan repayment is a serious matter, especially since it directly affects your credit score. The main thing to remember is to communicate with your lender. If you are unable to make continuous monthly payments, just pick up the phone and let them know. They understand how most recent graduates are on the lower end of the economic scale and will usually work with you to arrange a favorable payback schedule.
What's New
As of July 1, 2007, the interest rate on Stafford loans in repayment increased from 7.14% to 7.22%. The interest rate on in-school, grace, or deferment status Stafford loans went from 6.54% to 6.62%. And the rate for PLUS loans jumped from 7.94% to 8.02%. These rates will be in effect through June 30, 2008. The Department of Education sets the rates once each year based on the last three-month Treasury bill auction held in May.
These new rates apply only to loans issued on or after July 1, 1998 and before July 1, 2006. For all Stafford and PLUS loans issued on or after July 1, 2006, the loans will have a fixed interest rate--6.8% for Stafford loans and 8.5% for PLUS loans.
Keep Your Promise to Repay
Student loan repayment is a serious matter, especially since it directly affects your credit score. The main thing to remember is to communicate with your lender. If you are unable to make continuous monthly payments, just pick up the phone and let them know. They understand how most recent graduates are on the lower end of the economic scale and will usually work with you to arrange a favorable payback schedule.
Labels: Credit/Loans, Education/Work