Student Loans Consolidation Rates
To calculate student loans consolidation rate you must first understand all the interest rates of your loans you wish to combine. The federal consolidation student loans consolidation rate is dependent upon these figures.
Currently, federal student loans awarded after June. 31, 2006 have an interest rate of 6.8 percent (all numbers are as of January 2008). Student loans that were taken out prior (or on) this date feature an adjustable interest rate. These loans are up for re-adjustment annually in July. The adjustment depends solely on the results of the 91-day Treasure Bill Auctions. The following rates apply through June 2008.
Stafford Loans in grace period – 6.62 percentStafford Loans in repayment – 7.22 percentParent PLUS Loans (disbursed after July 1, 1998) – 8.02 percentParent PLUS Loans (disbursed after July 1, 2006) – 8.50 percent
Your student loan consolidation rate will be calculated by the weighted average of your current student loans. What does this mean? For example, if you have three loans with three different interest rates, you multiply the outstanding student loan balance by its interest rate. In other words, if you have a loan for $10,000 at 5.99 percent interest, you would multiply the two numbers to get 59,900. Do this for each loan. Next, add the totals from all three loans. Let’s say that number equals 137,775. Now, total the outstanding loan balances and divide them by the amount you came up with in step two. Finally, round the result to the nearest 1/8th percent. Sound complicated? If you are not good with numbers, find a consolidation calculator online to tell you what the weighted average of you loans is.
As you can tell, the student loans consolidation rate varies greatly. If you are interested in figuring your rate, but don’t know the amounts or rates of your current federal education loans, visit the NSLDS from ED.gov to access this information.