If you have a Parent Loan for Undergraduate Students, known as a PLUS loan, think about consolidating it.

PLUS loans are federally backed loans that help parents pay for college costs that aren’t covered by financial aid. The loans are in the parents’ names and are their responsibility. Most lenders let parents defer repaying the loan until their child has finished school.

As with Stafford loans, which are federally backed loans for student borrowers, the interest rate on PLUS loans will be adjusted July 1, based on rates for short-term Treasury bills. The rate for Stafford loans is expected to rise to around 7.1 percent from 5.3 percent; the rate for PLUS loans is expected to rise to about 8 percent from 6.1 percent.

If you have outstanding PLUS loans, you can lock in a rate of 6.125 percent by consolidating before July 1. Depending on how much you’ve borrowed and how long it takes you to pay off the debt, consolidating could save you thousands of dollars in interest over the life of the loan.

This entry was posted by Taman Siswa on Sunday, June 4, 2006 at 12:20 am and is filed under College Grant, College Loans, Financial Aid, Student Loan. Tags: College, Financial Aid, Loans, Student, . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.