Learn how Stafford and PLUS interest rates are changing

January 25, 2006 Laurel, Maryland

Begining July 1, 2006, interest rates on Federal Stafford and PLUS loans will change from a variable interest rate to a fixed interest rate. The change will affect only those loans disbursed after July 1, 2006. The rate on all new Stafford Student loans will be fixed at 6.8 percent. The rate on PLUS loans, for parents, will be fixed at 7.l9 percent but could increase to 8.5 under pending federal legislation.

To lock in the low current interest rate on your Federal Stafford and Perkins loans, please contact your lender for additional information on how to apply for a consolidation loan. Here are links to lenders on Capitol College’s preferred lender list.

• Sun Trust Education Loans - www.suntrusteducation.com
• JP Morgan Chase Bank - www.ChaseStudentLoans.com
• Citibank - www.studentloan.com
• Bank of America - www.bankofamerica.com/student
• National Education - www.nationaled.net

What is Consolidation?

Consolidation is paying off one or more eligible federal education loans by borrowing a new federal education loan. If you consolidate your loans, you can still defer loan payments as long as you are enrolled on at least a half-time basis; however, you will lose your grace period.

Why Should You Consolidate Now?

Because interest rates are at a 39 year low. Here are some other reasons to consolidate your loans.

• To reduce monthly loan payment
  • Increases monthly cash flow
• To have a single statement billing
• Increases convenience
• To take advantage of fixed interest rate structure
• Can reduce long-term cost