To Consolidate or Not To Consolidate...

I have a question and I don't have anyone to turn to that I trust for
an answer...so I'm trying this and I'm hoping for a quick response
because of the July 1st interest rate thing that is happening with
student loans. I'm sure everyone knows all about that...

Anyway, I'm trying to figure out if there is any reason for me NOT to
do a consolidation loan. I have about $40000 in student loans. I
graduated in August of 2002, and haven't paid a dime on any of them. I
have been in various stages of grace periods, deferments, and
forbearances. I am currently working for a Fortune 100 company for $7
bucks an hour with my business degree, trying to make it up the ladder,
but at this point can't even imagine a time when I will be able to
afford to start paying these back. I can barely pay my very modest
bills as it is.

My concern is that by consolidating this loan with a private lender, I
might be losing some rights or privileges that are granted by the
federal government in the initial loan that aren't given by the private
company. I know that the consolidators all still are federally
regulated somehow, but I'm not sure to what extent. I know that
eventually this is going to catch up with me, but I'm worried that by
doing this now...even though I might be saving myself thousands of
dollars down the road, I might be going into a situation where the
rules are different and maybe not as much in my favor. I'm worried
that collection efforts could be more aggressive and the private lender
less willing to do future deferments/forbearances, etc.

Any light you can shed on this for me would be greatly appreciated. I
have a FedEx envelope with a signed Promissory Note in it that I was
supposed to send out today (I only started this process about 5 days
ago) but I just couldn't do it because I didn't feel 100% comfortable
with the circumstances. The company seems reputable and the
representative I am dealing with very helpful, but in more general
terms I am still wondering if I am going to be a "deadbeat" whether or
not it would be better to just stick with Uncle Sam.

Any thoughts would be GREATLY appreciated (private e-mails OK).

Sincerely,

Adam.
adamdm.RemoveThis@gmail.com

Unless your Stafford Loans are what's known as "Direct Loans" they are
not with Uncle Sam but are with a private lender, which is the most
common type. If they are all Direct Loans, and it would say so on the
top of your statements, then you would consolidate with the Direct Loan
program.

Consolidating does not change the rules, it just freezes the interest rate.



Steven B. Blank
College Financial Aid Consultants
29 Ives Hill Court
Cheshire, CT 06410
(203)250-7761


heymrdj.TakeThisOut@gmail.com wrote:
> I have a question and I don't have anyone to turn to that I trust for
> an answer...so I'm trying this and I'm hoping for a quick response
> because of the July 1st interest rate thing that is happening with
> student loans. I'm sure everyone knows all about that...
>
> Anyway, I'm trying to figure out if there is any reason for me NOT to
> do a consolidation loan. I have about $40000 in student loans. I
> graduated in August of 2002, and haven't paid a dime on any of them. I
> have been in various stages of grace periods, deferments, and
> forbearances. I am currently working for a Fortune 100 company for $7
> bucks an hour with my business degree, trying to make it up the ladder,
> but at this point can't even imagine a time when I will be able to
> afford to start paying these back. I can barely pay my very modest
> bills as it is.
>
> My concern is that by consolidating this loan with a private lender, I
> might be losing some rights or privileges that are granted by the
> federal government in the initial loan that aren't given by the private
> company. I know that the consolidators all still are federally
> regulated somehow, but I'm not sure to what extent. I know that
> eventually this is going to catch up with me, but I'm worried that by
> doing this now...even though I might be saving myself thousands of
> dollars down the road, I might be going into a situation where the
> rules are different and maybe not as much in my favor. I'm worried
> that collection efforts could be more aggressive and the private lender
> less willing to do future deferments/forbearances, etc.
>
> Any light you can shed on this for me would be greatly appreciated. I
> have a FedEx envelope with a signed Promissory Note in it that I was
> supposed to send out today (I only started this process about 5 days
> ago) but I just couldn't do it because I didn't feel 100% comfortable
> with the circumstances. The company seems reputable and the
> representative I am dealing with very helpful, but in more general
> terms I am still wondering if I am going to be a "deadbeat" whether or
> not it would be better to just stick with Uncle Sam.
>
> Any thoughts would be GREATLY appreciated (private e-mails OK).
>
> Sincerely,
>
> Adam.
> adamdm.TakeThisOut@gmail.com
>