As of July 1st 2006, first time Stafford borrowers will receive a 6.8% fixed interest rate. All students with existing Stafford loans borrowed prior to July 1st, 2006 will continue to have a variable rate stafford loan.
Variable interest rate loans are expected to rise to 7.14% and interest rates on parent loans are expected to rise to 7.8%. Stafford borrowers who consolidate their outstanding loans before July 1st would be eligible to lock in an interest rate as low as 4.75%. Parent borrowers who consolidate before July 1st would be eligible to lock in a rate as low as 6.1% over the life of their loan.

While consolidation can help you get a lower interest rate and lower monthly payments, there can also be some disadvantages. Many consolidation loans lower your monthly payments by extending the amount of time you have to repay the loan, costing you more in interest in the long run. You may also lose rights to certain deferments if you consolidate. A deferment is a period of time during which the holder of your loan suspends your normal loan payments. Another advantage you may lose is any type of repayment benefits you currently have with your Stafford Loan. These are things like interest rate or principal reductions you may have earned automatically or by attaining certain repayment goals.

Late Breaking News on Loan Consolidation
Last night the President signed The Emergency Supplemental Appropriations Act 2006, H.R. 4939. This bill repeals the Single Lender Rule in student loan consolidation. In the past, students who only had federal loans with one lender had to attempt to consolidate with that lender. They did not have the option of choosing another lending institution for consolidation. As a result of this new bill, students will now have the choice to consolidate with the lender of their choice. The July 1 st deadline to consolidate at the current rate is approaching quickly. Many students will receive emails, mailings and maybe even calls from lenders urging them to consolidate with their company. Make sure to get all the details from each lender in order to make an informed decision.

To apply for a Federal Consolidation Loan you must be in repayment or in a grace period. You may still be able to consolidate if you are in school, but it may force you into immediate repayment. Consolidation while in school is not something we are suggesting.
What is it?

Federal Loan Consolidation is the process of taking all of your federal education loans (Stafford, Perkins, etc.) and combining them into one new loan. Currently Federal Consolidation loans have a fixed interest rate based on the weighted average of the loans that you are combining into the new loan.

What are the benefits of consolidating?

Consolidating will allow you to take variable-rate Stafford loans and change them into a fixed-rate loan. Also by consolidating you will only have to make one payment each month instead of making payments to multiple loans and possibly to multiple loan servicers.

Am I eligible to do a consolidation loan?

If you have at least $7500 in federal education loans in grace or repayment period, then you can consolidate your federal loans. If you have loans currently in default you should contact your loan servicer to see if you are eligible to consolidate.

Who should I choose to consolidate my federal loans?

If all of your federal loans are currently being serviced at one servicer (Sallie Mae, Nelnet, AES/PHEAA, Campus Partners, etc.) you may want to consider consolidating through that loan servicer. If you have loans at multiple loan servicers, then you can choose to consolidate with any lender that does Federal Consolidation Loans.

If you do have loans at multiple servicers and you decide to shop around for a lender, then one thing to keep in mind when choosing a consolidation loan is your long term plan for paying off the loan.

Are you planning on paying your loan off early? If so, you might want to consider a lender that will give you a reduction in your principal balance as a benefit for doing business with them.
Are you planning on extending the payment so that you have a lower monthly payment? If so, since you are going to pay more in interest charges by paying down the principal balance slower than a standard repayment, then you may want to choose a lender that will give you a reduction in the interest rate as a benefit for doing business with them. Many lenders offer this type of benefit. They do, however, vary based on number of on time payments you must make before the benefit starts. The amount of interest a lender will reduce will also vary from lender to lender.

When should I consolidate?

Typically our office recommends that students with Stafford loans begin the consolidation process around the fourth month of their grace period. The reason for this recommendation is that once your lender completes all of the paperwork for your consolidation loan, you will enter repayment and lose whatever portion of your grace period you have left. By consolidating it in the fourth month of your grace period, you receive most of the benefit of your grace period while also receiving the benefits of consolidating early. Because the grace period has the "in school" interest rate for Stafford loans, students who consolidate during their grace period lock in the lower "in school" interest rate.

What are the drawbacks to consolidation?

Once you consolidate your federal loans you cannot consolidate them again unless you have at least one new federal loan to add to the consolidation.
For students with Subsidized Stafford Loans the government is paying the interest on your Subsidized Stafford Loans while you are in your grace period. So if you consolidate during your grace period, you may have a lower interest rate on your new consolidation loan, but the government will not continue to be paying the interest on the Subsidized portion of your loans as you will now be entering repayment. (Some lenders will allow you to begin the consolidation process during your grace period so that you will receive the lower interest rate, but will delay fully processing the consolidation loan until the end of your grace period so that you receive the full benefit of your grace period. Check with your consolidating lender to see if they are willing to do this for you if you are in your grace period.)

If you consolidate Perkins loans in a Federal Consolidation loan, you may lose some of the forgiveness opportunities that are available under the Perkins loan program.

Can I consolidate private loans?

Borrowers can't consolidate private education loans into a Federal Consolidation Loan. Many lenders will offer a separate consolidation loan product that will allow students to consolidate their private education loans together, but usually these private consolidation loans have new origination fees associated with them, so usually this is not in the best interest of the borrower.
Federal Consolidation is a good idea.

Consolidating Federal Stafford Loans into a Federal Consolidation Loan is a good idea for most borrowers in today's market. Consolidation can allow borrowers to extend payments beyond the normal 10-year repayment of their Stafford loans depending on the amount borrowed.

__________________
Submissions | Hip-Hop 4 Obama

Hello everybody, I am writing a novel and I don’t want to spend for free grants out. I already know I want a grant for writing a book. I just need to know what govt. office I need to call or who to write to a request the application to be mailed to me. I just want the application for the grant itself. With application in my hands, I can handle the rest. Can you please help me?

__________________
TIT FOR TAT

Federal student loan consolidation is very helpful to students with multiple federal loans. It eases the burden of the student’s repayment by bundling all his student loans into a single loan with one lender and one repayment plan.
Best Top Loans - Consolidate Federal Student Loans