The loan arranger

[vvvexation]

I'm being plagued by message after message suggesting that I consolidate my student loans--specifically, that I consolidate them NOW! in order to LOCK IN THIS SPECIAL LOW RATE! This sounds shady to me, but even the government website where I'm trying to conduct my mandatory exit interview is linking me to these folks. Are they less shady than I think? Would it actually be a good idea to do this? Would it really lower my interest rates?

Comments

[bk2w.livejournal.com]

Consolidating has another way of lower your monthly payments: reseting the repayment clock. Stretching the same remaining loan over a longer period also has the not so nice effect of increasing the total interest paid.

[vvvexation.livejournal.com]

I'm confused: are you saying consolidating generally includes lengthening the grace period, or what?

[(Anonymous)]

It usually resets the length of repayment. My student loans were scheduled to paid over 10 years, starting 6 months after I graduated. Consolidating a year into repayment (9 years left) would reset the repayment schedule back to 10 years. If you're still in the 6 month grace period then you probably don't care about this detail.

[vvvexation.livejournal.com]

Ah. Well, it'll probably be six months to a year till I consolidate if I do it at all, so that does make a difference but I guess not much of one.