Federal student loan repayment rates
By Kim Clark
Posted 5/30/06
About two thirds of all college students borrow to fund their education. Those borrowers typically graduate owing about $20,000. Anyone who "consolidates" federal education loans by June 30, thus locking in the current low interest rate, can save thousands:
| Student loans (Staffords) | Interest rate | Interest paid over life of loan (10 years) |
| No consolidation | 7.14% | $8,039 |
| Consolidated loan for anyone who has been out of school for more than six months | 5.375% | $5,898 |
| Consolidated loan for anyone who has been in school within the past six months | 4.75% | $5,163 |
| Consolidation with 0.25 percent discount for automatic payment offered by many lenders | 4.50% | $4,873 |
The parent loan (PLUS) figures represent a typical $10,000 loan:
| Parent loans (PLUS) | Interest rate | Interest paid over life of loan (10 years) |
| No consolidation | 7.94% | $4,521 |
| Consolidation | 6.1% | $3,383 |
Source: College Loan Corp.
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