Jul 4, 2008 5:03 pm US/Pacific
Save With Dave: How To Save On Student Loans
SACRAMENTO (CBS13) ―
In tonight's Save with Dave, saving hundreds on student loans is easy with one way I will show you tonight.
A sharp drop in interest rates over this past year means people with variable-rate student loans can save money by consolidating to a fixed rate.
Rates re-set on July 1st, and those Stafford and Plus Loans are set to drop over three percent.
Interest on a Stafford Loan will be around 3.6% during the first six month grace period after college graduation.
For loans that are already in a re-payment status the fixed rate will be 4.2%, and for plus loans you're looking at around 5%.
That can be real savings for someone like Alex Sargis, who graduated last year from USF and has two loans.
"It's close to about $14,000, and my other loan is a Federal Perkins Loan and it's around $4400," says Alex.
If Alex consolidates now, she can really save, considering her rate is 6%.
"That'd be great, I definitely need to do that now," Alex says.
To find a borrower who can consolidate your loans, check with the Federal Direct Consolidation loan program.
So how much can you save? $18,000 at 6% is around $1080 in interest every year, but at 3.6% it's $648.00, which is a savings of $432 annually for the life of the loan.
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