Find all School-related info fast with the new School-Specific MBA Forum

It is currently 21 Oct 2014, 06:06

Close

GMAT Club Daily Prep

Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History

Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.

Events & Promotions

Events & Promotions in June
Open Detailed Calendar

Student Loan interest rates going down?

  Question banks Downloads My Bookmarks Reviews Important topics  
Author Message
Manager
Manager
User avatar
Joined: 19 Aug 2006
Posts: 65
Followers: 2

Kudos [?]: 1 [0], given: 0

Student Loan interest rates going down? [#permalink] New post 29 Jan 2008, 06:26
This is from ed.gov: http://www.ed.gov/offices/OSFAP/DirectLoan/calc.html

"Current interest rates For Stafford loans first disbursed between July 1, 1998, and June 30, 2006, the interest rate for the period July 1, 2007, through June 30, 2008, is 7.22% for loans in repayment and 6.62% during in-school, grace, and deferment periods. Similarly, for PLUS loans disbursed between July 1, 1998, and June 30, 2006, the interest rate is now 8.02%.

The interest rate for new Stafford loans first disbursed on or after July 1, 2006, is a fixed 6.80%. The interest rate for new PLUS loans is a fixed 7.90%. For Direct consolidation loan interest rates, see that rate page for information."

As the Federal Reserve is cutting interest rates left and right, I'm wondering how this will impact student loan rates for school year 2008-2009. I would hope stafford loans would drop below 6.80% and PLUS below 7.90%. Anyone have insight?
SVP
SVP
avatar
Joined: 05 Aug 2007
Posts: 1502
Schools: NYU Stern '11
Followers: 15

Kudos [?]: 205 [0], given: 22

Re: Student Loan interest rates going down? [#permalink] New post 29 Jan 2008, 06:31
Unless Congress does something about it, there are going to be no changes in the Stafford and PLUS loan programs' interest rates. The rates have been fixed since 2006 and no longer fluctuate based on T-Bill yields.

So, basically the rates will stay fixed at 6.8% and 8.5%, respectively for '08-'09. And I'm not sure how one gets PLUS loans at 7.90%.
Director
Director
User avatar
Joined: 24 Apr 2007
Posts: 589
Followers: 3

Kudos [?]: 17 [0], given: 0

Re: Student Loan interest rates going down? [#permalink] New post 29 Jan 2008, 12:00
That kind of sucks. I consolidated my undergrad stafford loans at 2.8%.
SVP
SVP
avatar
Joined: 05 Aug 2007
Posts: 1502
Schools: NYU Stern '11
Followers: 15

Kudos [?]: 205 [0], given: 22

Re: Student Loan interest rates going down? [#permalink] New post 29 Jan 2008, 12:03
Yep - my undergrad loans are at 1.75%. Obviously the Dept. of Ed. wised up to this :)

bherronp wrote:
That kind of sucks. I consolidated my undergrad stafford loans at 2.8%.
GMAT Club Legend
GMAT Club Legend
User avatar
Status: Um... what do you want to know?
Joined: 03 Jun 2007
Posts: 5464
Location: SF, CA, USA
Schools: UC Berkeley Haas School of Business MBA 2010
WE 1: Social Gaming
Followers: 65

Kudos [?]: 338 [0], given: 14

Re: Student Loan interest rates going down? [#permalink] New post 01 Feb 2008, 14:01
bherronp and solaris, how did you get rates that low???
_________________

****************************
GMAT Club Knowledge Vault:
http://gmatclub.com/forum/123
Haas Ambassador
http://gmatclub.com/forum/128-t62555
Kryzak's Profile:
http://gmatclub.com/forum/111-t56286
Member Essays:
http://gmatclub.com/forum/103-t50969

SVP
SVP
avatar
Joined: 05 Aug 2007
Posts: 1502
Schools: NYU Stern '11
Followers: 15

Kudos [?]: 205 [0], given: 22

Re: Student Loan interest rates going down? [#permalink] New post 01 Feb 2008, 14:40
Those simply were the actual rates on Stafford loans in July 2004, kryzak.

In addition, Sallie Mae throws a few freebie rate deductions your way if you make a certain number of monthly payments on time. So I went from a rate of 2.7625% at graduation to 1.75% now. I'm obviously in no hurry to pay off my college loans. :)
GMAT Club Legend
GMAT Club Legend
User avatar
Status: Um... what do you want to know?
Joined: 03 Jun 2007
Posts: 5464
Location: SF, CA, USA
Schools: UC Berkeley Haas School of Business MBA 2010
WE 1: Social Gaming
Followers: 65

Kudos [?]: 338 [0], given: 14

Re: Student Loan interest rates going down? [#permalink] New post 01 Feb 2008, 15:22
WOW... the rates for stafford was *that* low? I guess the fed rates were 1% back then. I was trying to get a refinance for my mortgage around the 04-05 time frame, but couldn't get it below 5%... sigh.

I don't like that 6.8% thing... I'd rather just use my savings in that case...
_________________

****************************
GMAT Club Knowledge Vault:
http://gmatclub.com/forum/123
Haas Ambassador
http://gmatclub.com/forum/128-t62555
Kryzak's Profile:
http://gmatclub.com/forum/111-t56286
Member Essays:
http://gmatclub.com/forum/103-t50969

Current Student
User avatar
Joined: 17 May 2007
Posts: 385
Followers: 3

Kudos [?]: 7 [0], given: 0

Re: Student Loan interest rates going down? [#permalink] New post 04 Feb 2008, 22:50
Mine undergrad loan is locked somewhere around 2% too (never really paid attention since it was so low)...but now I'm going to be borrowing 10x as much...at a much higher percentage rate. SCARY.
GMAT Club Legend
GMAT Club Legend
User avatar
Joined: 10 Apr 2007
Posts: 4320
Location: Back in Chicago, IL
Schools: Kellogg Alum: Class of 2010
Followers: 78

Kudos [?]: 701 [0], given: 5

Re: Student Loan interest rates going down? [#permalink] New post 05 Feb 2008, 08:55
If you think 6.8% is bad look at most private loans. If the feds continue to drop rates they might improve but a lot of published ones I have seen have been 8-11% depending on credit scores. Now if you think that is bad think of what some international students will end up getting if they dont have co-signers. Some companies also screw you on fees, I have seen 0-8% for upfront fees. Most private rates are variable too so while they may be low now they could easily end up going back up in a year or two.

Wish I owned a house where I was going to school, a home equity line of credit or equity loan rate are so much more attractive than student loan rates.
_________________

Kellogg Class of 2010...still active and willing to help. However, I do not do profile reviews, don't offer predictions on chances and am far to busy to review essays, so save the energy of writing me a PM seeking help for these. If I don't respond to a PM that is not one of the previously mentioned trash can destined messages, please don't take it personally I get so many messages I have a hard to responding to most. The more interesting, compelling, or humorous you message the more likely I am to respond.
Get the best GMAT Prep Resources with GMAT Club Premium Membership

GMAT Club Legend
GMAT Club Legend
User avatar
Status: Um... what do you want to know?
Joined: 03 Jun 2007
Posts: 5464
Location: SF, CA, USA
Schools: UC Berkeley Haas School of Business MBA 2010
WE 1: Social Gaming
Followers: 65

Kudos [?]: 338 [0], given: 14

Re: Student Loan interest rates going down? [#permalink] New post 05 Feb 2008, 09:32
yeah, I was tempted to do a Home Equity Loan, but alas, no reason to keep the house if you can't deduct interest/taxes, and if the house isn't really appreciating in value in the near future.
_________________

****************************
GMAT Club Knowledge Vault:
http://gmatclub.com/forum/123
Haas Ambassador
http://gmatclub.com/forum/128-t62555
Kryzak's Profile:
http://gmatclub.com/forum/111-t56286
Member Essays:
http://gmatclub.com/forum/103-t50969

GMAT Club Legend
GMAT Club Legend
User avatar
Joined: 10 Apr 2007
Posts: 4320
Location: Back in Chicago, IL
Schools: Kellogg Alum: Class of 2010
Followers: 78

Kudos [?]: 701 [0], given: 5

Re: Student Loan interest rates going down? [#permalink] New post 05 Feb 2008, 11:00
We talked about leasing our house for about 5 minutes...its not worth the hassle of being a landlord. Especially when I am half way across the country. Yes I could hire a management company but I dont think I would trust someone with my house. The wear and tear, and aging of all my renovations will probably negate any value it could regain in the next year or two. It is more important to sell quickly than it is to get every last penny at this point. If I was going ot school in Boston it would probably be different because I could stay at my parents until it sold. No way I can foot a mortgage/taxes/insurance and rent.

With the WSJ prime rate dropping a percent or so in the last month and the potential for another drop in the near future interest rates should go down again if you get a loan tied to prime. That said in 2 years when the feds jack up rates to stem inflation we could end up being screwed if there isnt a way to lock in. I will take a half percent hit if I can lock in so I dont end up like the people who in 2004 got 3 year ARMs on their houses to get 4.5% instead of 4.8% fixed.
_________________

Kellogg Class of 2010...still active and willing to help. However, I do not do profile reviews, don't offer predictions on chances and am far to busy to review essays, so save the energy of writing me a PM seeking help for these. If I don't respond to a PM that is not one of the previously mentioned trash can destined messages, please don't take it personally I get so many messages I have a hard to responding to most. The more interesting, compelling, or humorous you message the more likely I am to respond.
Get the best GMAT Prep Resources with GMAT Club Premium Membership

GMAT Club Legend
GMAT Club Legend
User avatar
Status: Um... what do you want to know?
Joined: 03 Jun 2007
Posts: 5464
Location: SF, CA, USA
Schools: UC Berkeley Haas School of Business MBA 2010
WE 1: Social Gaming
Followers: 65

Kudos [?]: 338 [0], given: 14

Re: Student Loan interest rates going down? [#permalink] New post 05 Feb 2008, 13:00
at this point I kind of wished I stayed with the 5 or 7 year ARM at 0.5 to 0.75% lower rates. I switched from 7 year ARM to 30 fixed because I thought it would always be good to keep the place, even if I buy a 2nd home or something. But that was way before I even considered going back to school. How things change...
_________________

****************************
GMAT Club Knowledge Vault:
http://gmatclub.com/forum/123
Haas Ambassador
http://gmatclub.com/forum/128-t62555
Kryzak's Profile:
http://gmatclub.com/forum/111-t56286
Member Essays:
http://gmatclub.com/forum/103-t50969

Re: Student Loan interest rates going down?   [#permalink] 05 Feb 2008, 13:00
    Similar topics Author Replies Last post
Similar
Topics:
Reducing interest rates on U.S. Federal loans Guangjujiu 1 23 Apr 2014, 17:28
6 Experts publish their posts in the topic If a loan of P dollars, at an interest rate of r percent... NeverSurrender 4 11 Oct 2013, 02:27
Can I ask for interest on defaulted student loans when I fil ajshco 0 23 Jan 2013, 05:22
Experts publish their posts in the topic A loan has a variable interest rate that fluctuates between danzig 2 25 Dec 2012, 09:31
Interesting read on Student Loans.... kk.iyer 1 13 May 2008, 10:47
Display posts from previous: Sort by

Student Loan interest rates going down?

  Question banks Downloads My Bookmarks Reviews Important topics  

Moderator: threestripes



GMAT Club MBA Forum Home| About| Privacy Policy| Terms and Conditions| GMAT Club Rules| Contact| Sitemap

Powered by phpBB © phpBB Group and phpBB SEO

Kindly note that the GMAT® test is a registered trademark of the Graduate Management Admission Council®, and this site has neither been reviewed nor endorsed by GMAC®.