Can I still take out federal Stafford loans under the interest rate before 1 July increase?
I tried take federal Stafford student loans for next Fall Semester. I sent my application in late May to secure interest rates before the July 1 increase. I was told my interest rate would be fixed rate grew by 6.8% because "my loans were disbursed earlier than 10 days before the start of my program. "What is the rule and this is there a way to circumvent so I can get the rate of 5.3%, after all it is not July 1st yet?
The rate of 6.8% applies to interest loans "first made on or after July 1." This was already enrolled in the Higher Education Act. * * The first person loans can be disbursed is 10 days prior to its registration period (ie the start of classes). So, unless you are early classes very, very soon, your loan must be subject to the new fixed rate 6.8%. There's really no reason to hurry or try find a way to circumvent the regulations. Even students who * may * have paid their loans before July 1st will still be subject to higher interest rates. The rate structure is simple enough: for all loans first disbursed before 1 July 2006, the rates * * vary and are based on the 91 days T-bill. Since we already know what Bill T gone, we know that the rates on all variable rate loans [disbursed since July 1998] is 6.54%. In other words: even if you could lay hands on a Stafford loan with a rate of 5.3%, it will be only 5.3% for 9 more days. The only way to fix ( "Lock in") this rate would be to consolidate before the rate increase … but you can not consolidate loans until fully disbursed (which means waiting for the second installment to come through [in your case, probably for editing 2007 Spring semester]). Take the higher rates in the wake – millions of students in your same position. In the grand scheme of things, a fixed rate of 6.8% is not so bad (people would kill for a credit card or car loan low!) …
