It is a thread I have noticed in other reading I have done: the rich are pulling further and further away from the poor, and the poor are losing more chances to catch up. Wages fall, but it profits are up, that is irrelevant. We seem to have more in common with the beginning of the 20th century, when capital held all the cards. How did we lose so much ground? And what is being done to stop it?

I trust my Financial Aid Office. And I'm pretty
sure it doesn't really make a difference anyway.

So, what then is the advice on loan consolidation? I graduated about 2 years ago and I still feel I have not received ANY advice I can trust, just tons of advice that leaves me clueless. I receive plenty of notices about consolidation, but I feel like purchasing the Student Loan Consolidation for Dummies book might be the only solution.

First off I want to let you know I feel your pain. I get overwhelmed with marketing collateral about consolidating student loans. I have learned to appreciate the fact that we are living in an age of information and I have becaome appreciative of the fact that I no longer have to look around for information as it routinely arives at my doorstep.
With respect to the student loan program I will admit that I have an advantage on most people as I work for a lender. The reality about the programs is that there really are no ways you can lose other than doing nothing at all.
Lenders make out because student loans are 98% backed by the federal government. This means if you default they get paid. Additionally the government pays them Floor Income. Without overcomplicating the matter it means they are making money regardless if rates are high or low.
Every lenders base rat es on a Consolidation are going to be identical. The goverment uses a weighted average calculation to determine the rate. The differences are in the lender incentives. This might be soemwhat deceptive. I say this not because the lenders are cheating but rather because we as individuals leaving college are short of vision adn full of hubris. Most lenders provide % rates reduction as incentives outside of the government guidlines. Usually this means making on time payments for 2 or 3 years. Unfortunatly only about 15 to 20% of students can accomplish this. Why? Because life happens? We move, we change jobs, we have kids, we get married adn during these periods of time our cash flow is hurt. WE therefore postpone payments on our loans. Lenders understand this but the marketplace like to feel empowered when they are setting up their accounts and feel as though they are getting a deal. The reality about student loans are to consolidate early while you are in your grace period. Accept the fact that you are getting a great rate on these loans regardless of lender incentive. Consider the incentive gravy if you make the 3 years of on time payments.
As for the rich not having any studnet loans. You miss a bigger point. The rish understand the vlaue of cheap borrowing costs. They take as much money as they can get. Unfortunately it is the middle class who are uncomfortable with finance who lose out. They forego sheap student loans because they dislike debt yet ask them if they have a balance on there credit card and they are carrying 10K at 12%. Ask if they would not be better off borrowing as much as they can through the government programs to reduce or pay off such debts and it is 50/50 if the lights ever go off for them. The rates are schedule to go from 4.7 to 6.8 on July 1 for stafford loans and 6.1% to 8.5% for PLUS loans. Get this done now while you are in school so that if ther is any missing documentation there is plenty of time to correct any mistakes. You will get the best rates and you will enjoy your graduation.

Some interesting facts about student loan consolidation:

A student cannot consolidate his or her student loans with his/her parents PLUS loans. However, he can consolidate ALL of his loans together, while his parent can consolidate ALL of their childrens' PLUS loans together. So, if you have 5 kids, and you have a PLUS loan (or several) out for each of them, you CAN consolidate ALL of the PLUS loans together. In addition, if you have PLUS loans, and you have loans for yourself, you can consolidate them as well. The only thing you can't do is consolidate your federal loans together with private loans.

Also, people have a tendency to think that if you and your spouse consolidate together (which you can do, legally) you'll save money. However, if you or your spouse dies, and your loans are consolidated together with theirs, the survivor still has to pay ALL of it. Whereas, if you consolidate separately, and your spouse dies, their loans are forgiven, so you still only have to worry about your own.

I've had people ask about consolidating old loans with new loans, and whether they should keep the old one separate. That depends. The interest rate is determined by a weighted average. The interest rate from the larger loans matters more than that of the smaller loans. So, if you have a $50,000 loan at a low rate, and a $20,000 loan at a high rate, the average rate will be closer to the lower one. Just as the opposite is true.

One more thing. If you have a consolidation with one lender, as of right now, you can only reconsolidate with another lender IF you left out loans from that consolidation, or have new loans to add to it. It's called the Single Lender Rule. If one FFELP lender owns all of your loans, they have the right to refuse to release them to another company. Additionally, if you have all of your FFELP loans with one lender, and some DOE loans, the ONLY company that can consolidate them, as of right now, is the FFELP lender who owns all of your loans. But if you have more than one FFELP lender, you can consolidate with whatever company you want.

I've consolidated my loans with NextStudent. After doing my research, I've come to the conclusion that they have, by far, the best student loan consolidation package. In case you're wondering, EVERY student loan consolidation company has the same interest rate. It's government regulated. The only way to differentiate between one company and another is the fact that they can offer incentives. Most companies offer you an interest rate reduction after say, 36 on-time payments. However, NextStudent is the only company that LOCKS IN that rate. So, once you get the reduction, you can't lose it. Every other company out there will give you the reduction, but once you make one late payment (such as in the case of auto-debit, if your due date falls on a holiday or weekend, the bank won't pay it until the following business day, thus your payment is late), you lose it, and it goes back up to what it was before.

i hate why i have seen the page late. but i think the intention of the user posting it was to consolidate before the interest increase policy made. i have settled mine and somehow it's goin ok.

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