For Immediate Release
May 25, 2005
800-525-2577
Student Loan Interest Rates at All Time Low, Consolidate While In-School & Save
NHHELCO Borrowers Can Benefit from Savings
Concord, N.H. - Federal guidance released on May 16, 2005 will allow students to consolidate their federal student loans while still attending school and lock in the current historically low interest rates. This could translate into thousands of dollars in savings for students over the life of their loans, since the current rates available on Consolidation loans are as low as 2.875 percent.
With federal student loan interest rates expected to rise on July 1, 2005 for the first time in five years, borrowers must act quickly in order to take advantage of these savings. The NHHEAF Network Organizations, New Hampshire's leading provider of student loans, will follow the recent guidance released by the U.S. Department of Education to student loan providers and offer in-school students a chance to consolidate.
To lock in the historically low interest rates, borrowers must have a balance of at least $7500 in federal student loans and complete the Consolidation Application and return it to NHHELCO, the lending arm of the NHHEAF Network Organizations, no later than June 30, 2005. Alternative, or private loans, cannot be included in a federal consolidation loan.
Typically, borrowers must wait to consolidate their loans until they have graduated and are in their grace or repayment period. The fixed interest rate on Consolidation loans is determined by a weighted average of the interest rates for the loans to be consolidated, rounded up to the nearest one-eighth percent, but not to exceed a federal interest rate cap of 8.25%. Federal student loan interest rates are adjusted each July 1. The rate is based on the 91-day Treasury bills at the last auction in May. Experts predict that when student loan interest rates are adjusted this July the interest rates could rise by as much as two percentage points.
Students who choose to consolidate while still in-school will have to elect to enter repayment early and waive their six month grace period following graduation. The grace period is typically used by students as a time to find a job and get financially established before starting repayment of their federal education loans. Recent college graduates and borrowers in the grace or repayment periods of their federal student loans can also consolidate.
The NHHEAF Network Organizations encourage borrowers to examine their own personal financial situation and consider the impact that immediate repayment upon graduation will have upon their lives and finances. To better determine if consolidation is right for their situation, borrowers are encouraged to utilize the loan consolidation calculator that is available at http://www.nhheaf.org/calcs.asp
For more information about consolidation and if you can take advantage of the low rates, contact Customer Service at 1-800-525-2577 or visit www.nhheaf.org.
The NHHEAF Network Organizations are comprised of three independent, nonprofit organizations: The New Hampshire Higher Education Assistance Foundation, which was established by the banking community in 1962 to guarantee student loans; the New Hampshire Higher Education Loan Corporation, which was designated by the State of New Hampshire in June 1993 to be a lender and holder exclusively for student loans; and Granite State Management & Resources, which is the loan servicing arm of the Organizations. Collectively, the NHHEAF Network Organizations offer complementing services to families including information and materials about planning for higher education, education loan funding and life-of-loan servicing. The NHHEAF Network Organizations can be reached at 1-800-525-2577 or online at www.nhheaf.org.
