Robbins: Federal Student Loan Interest Rate Set to Jump July 1

Borrowers should consider loan consolidation now to save thousands.

Harrisburg – The federal Stafford student loan interest rate is scheduled to increase by nearly two percent on July 1, and borrowers should consider loan consolidation now to save thousands of dollars, state Sen. Bob Robbins (R-50) said today.

Robbins said that according to the Pennsylvania Higher Education Assistance Agency, by locking in the current low interest rates and consolidating before July, borrowers with a $25,000 loan can save an average of $5,580 in interest.

"Parents and students know that financing a college education is hard work, and an increase in the interest rate only makes it harder. But there are options," said Robbins. "I encourage borrowers to consider consolidating their student loans, which could cut their monthly payments in half. PHEAA offers consolidation counseling services that can help, but the July 1 rate hike is fast approaching."

Loan consolidation helps borrowers by locking in a lower fixed rate and by making their repayment easier – either by lowering their monthly payments or by combining multiple payments into one.

PHEAA consolidation counselors work with the borrower on all debt management alternatives. PHEAA recommends that students, parents and graduates review the potential impact of consolidation on their current loan benefits and on the total cost of their loan before consolidating.

Students, parents and graduates who would like more information on loan consolidation and PHEAA services should call 800-338-5000, visit www.aesSuccess.org , or email questions to network@aessuccess.org.

CONTACT:

Mike Hengst
(717) 787-1322