A lot of my posts here are aimed at parents of young tots, so here’s one for you folks with older children, or those not long out of higher education yourselves. The Christian Science Monitor just published a lengthy article on student-loan consolidation, offering advice on what to consider and highlighting some recent changes in loan regulations. For instance, Congress last year revoked the “single holder” rule, which said students who borrowed from only one lender had to use that lender if they wanted to consolidate. Now they may consolidate with whomever they choose. Also, this is the first year when students will graduate with fixed-rate federal Stafford loans. While consolidating almost always made sense with a variable-rate loan, it is not as clear a move now.
For those of you just starting on the student-loan journey with your children (or for yourselves), the AP’s Primer on Borrowing for College is a quick overview of the basics.
The past months’ headlines about schools accepting undisclosed gifts in exchange for steering students towards “preferred lenders” should make anyone cautious about the lending process. Shop around, read the fine print, and ask questions.
Don’t consolidate with someone else (if it’s even allowed for same sex couples). I consolidated with my ex husband and now our loans are forever together.