The student loan consolidation rate is calculated as the weighted average rate of the current rates charged on the loans being consolidated, rounded up to the nearest one-eighth of a percent. This means the rate you'll pay won't be more than one-eighth of a percent more than the effective rate on your individual loans. The rate is fixed for the life of the Consolidation Loan.

The new interest rates for variable loans as of July 1st 2006 are as follows:

Stafford loan for students in school, in grace (6 months after graduation), or in deferment are 6.54%

Student loans in repayment or in forbearance are 7.14%

Parent plus loans are 7.94%

We here at Student Financial Advisors can offer you the barrower the following benefits for consolidating your student loans with us.

We can cut your effective student loan consolidation rate in the following ways; first we will give you .25% off of your interest rate if you sign up for automatic check withdrawal. Next, you will benefit from a .60% rate differential if you consolidate while you are still in your grace period. That is your effective interest rate is .60% less while you are in your grace period, your effective interest rate is 6.54% while in grace versus 7.14% while in repayment or forbearance. Lastly, we will give you one percent (1%) off of your effective interest rate if you make 36 on time payments. If you sign up for the automatic check withdrawal, all of your payments should be on time. This effective interest rate, a total of 1.85% rate reduction, is fixed for the life of the loan.

Other benefits for consolidating with Student Financial advisors include, lowering your monthly payment by as much as 51%. By extending the repayment period it is possible to lower your monthly payments by as much as 51%. Also, by consolidating, making payments is easier to keep track of, because you only get one monthly bill. We suggest that you use the optional automatic bill payment; you will still get monthly statements.

By consolidating you renew your deferment eligibility, up to three years. Lastly, when the consolidation loan pays off all of your student loans this reflects positive on your credit report and therefore improves your credit.

As of February 1, 1999, both Federal Family Education Loans (FFEL) and Direct Consolidation Loans have the same interest rate. Before February 1, 1999, Consolidation Loans had variable interest rates.

If you have a Stafford Loan made on or after July 1, 1995, you can reduce your consolidation rate by up to point six of a percentage point or more if you can consolidate before the end of your grace period.

Consolidation allows you to simplify the repayment process by combining several types of federal education loans into one loan, so you make just one payment a month. Also, based on the incentives above your monthly payment might be lower than what you're currently paying. Based on all of the incentives to consolidate your monthly payment and your effective student loan consolidation rate should be lower then you would otherwise pay.