School Loan Consolidation Interest Rate

If you get a School Consolidation loan, your interest rate is based on a federal calculation that uses the weighted average of the interest rates of your existing loans. The average is then rounded up to the nearest 1/8 percent.

A fixed rate is generally a desired option. This is especially important if you think that interest rates will be going up in the future. If you think interest rates will be going down in the future, then a variable interest rate would be to your advantage. You should talk to you school financial adviser or a financial planner to get an idea of where interest rates might be in the near future. Currently, interest rates are quite low, so consolidating your school loans into a fixed interest rate would be a good idea, before the interest rates increase.

Interest rates are set a the following percentages:

Perkins Loans are 5%

Plus Loans are 7.94%

Stafford Loans in grace are 6.54%

Stafford Loans in repayment are 7.14%

Stafford Loans in repayment prior to July 1, 1988 are 7.94%

Prior Consolidation Loans are at the existing consolidation rate