Student loan programs to switch lenders beginning Fall 2010

SFA Financial Aid will be switching lenders for student loan programs. This scheduled change will affect more than 7,000 students utilizing the Federal Stafford Loans (subsidized and unsubsidized) as well as the Federal Parent Plus Loan.

Currently, loan funding comes from 100+ financial institutions that participate in the federal loan program; with this change, funding will now be allocated through one direct lending source, the U.S. Treasury. All students who plan on receiving financial aid beginning with the Fall 2010 Semester must complete a new master promissory note regardless of previously completed promissory notes. This includes any loans granted to SFA parents as well.

This change will not affect interest rates, as they are set in the same manner and will be appointed accordingly.

"Our biggest concern is educating students about this impending change so that they know what to do and when to do it," Rachele Nixon, assistant director of financial aid, said. The financial aid department plans on rolling out a campaign to educate students on the changes beginning in December with a heavy emphasis in the Spring 2010 Semester after the transition has been completed and the process nailed down.

An important issue for upper level students receiving financial aid to consider is that this change will have a greater affect on their loans.

"Our long-term goals for students is that they understand when they graduate they will then carry two loans, (one) from the previous system and (one from) the new system. At (that) point they may wish to consider a consolidation loan upon graduation to alleviate the burden of carrying multiple loans," Valerie Harrell, assistant director of financial aid, said.

Student loans for the 2008 SFA school year amounted to $68 million, further indicating the scope of this change for students. This transition to direct lending through the U.S. Treasury is being instated in multiple higher education institutions, and the numbers are expected to grow. Over the past two years the financial aid program has begun losing participating lenders due to fundamental issues concerning new regulations that are tightening up the lending process.

While SFA is not legally bound to make this switch, current legislation indicates that it may very well become a mandate in the future.


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Student Loan Debt ? - Consolidation Private & Federal School Loan

Today with the cost of living going up each day, getting a school loan for your child’s education seems like a good option to many people. Thus, there are more and more people going for these loans. However, once you finish your education and are settled with the job you realize that you have to pay it back along with many other real life expenses. Definitely, there are many options for you to explore in order to repay your loan. The best and apparently more realistic one is to go for a private school loan consolidation .

School loan debt consolidation helps you put together all your scattered educational loans and make it into one total loan amount to be repaid with lower interest rates. Thus saving you a lot of money in the process. It is a good way of getting rid of all your loans in one go and the best debt consolidation will offer you lower monthly repayments, extended period of repayments, saving money due to the long repayment period.

Student Loan Debt ? - Consolidation Private & Federal School Loan

For secured or unsecured loan for debt consolidation , you will find many lenders in the market. But you have to meticulously find a genuine debt consolidation company who really are interested in helping you with what you want. Look into the details of what they have to offer, what kind of terms and conditions they purpose and the interest rate that they provide you. If this sounds like too much work, you have an easy option of finding all this information sitting right at your home that is, going online. You can find all types of loans like the federal school loan consolidation on the net, and also spend your time in searching and comparing more number of lenders. Thus, you end up making a well-informed decision.

The best time to go for consolidation is right after your graduation because you are sure to find the best rates at that time junction. Again, one of the best convenience that loan consolidation offers is to deal with only one loan and one monthly installment. Research is the key, the better researched the better loan you will get.


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Student Loan Consolidation Interest Rates

The interest rates for federal student loan consolidations are based on the weighted average of student loan interest rates. Federal Stafford loans disbursed between July 1, 2006 and June 30, 2008 have an interest rate of 6.8%*. Stafford loans disbursed after July 1, 2008 have a rate of 6.0%.
Federal student loans will have different rates depending on type and disbursement dates. For example, rates for Stafford loan disbursed before July 1, 2006 will remain variable until consolidated. Visit StaffordLoan.com or ParentPLUSLoan.com for more details on federal student loan interest rates.

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