Consolidating with Direct Loans

[pmpkn219]

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All my loans are the Federal direct Sub or Unsubsidized. And since I got them recently, all have a 6.8% rate. I still got an email from DLS the other day pointing out that I can soon consolidate, sign up for Automatic Debit, etc...

They mentioned the 0.25% interest cut for using automatic withdrawal which I'm down with, but they also state that I can consolidate during my Grace period. They say the interest rate during Grace is actually 5/8th of a point (~0.6%) less than once you enter repayment. So does that mean during Grace the rate is 6.8, and it hops up to ~7.4 after X days... or are my unsub. loans now accruing at ~6.2, and in repayment would jump to 6.8?

I checked on "entrance counseling" and couldn't find an answer... I know 5/8 isn't a huge difference, but every bit helps =)

I'm not sure if they sent me the email in error, or if they send it to all students with Direct Loans... would they even let me "consolidate" 3 loans which all have Exactly the same rate, from the same lender? The weighted average would obviously be 6.8!

I hate loans😕

 

[Bleurberry]

All my loans are the Federal direct Sub or Unsubsidized. And since I got them recently, all have a 6.8% rate. I still got an email from DLS the other day pointing out that I can soon consolidate, sign up for Automatic Debit, etc...

They mentioned the 0.25% interest cut for using automatic withdrawal which I'm down with, but they also state that I can consolidate during my Grace period. They say the interest rate during Grace is actually 5/8th of a point (~0.6%) less than once you enter repayment. So does that mean during Grace the rate is 6.8, and it hops up to ~7.4 after X days... or are my unsub. loans now accruing at ~6.2, and in repayment would jump to 6.8?

I checked on "entrance counseling" and couldn't find an answer... I know 5/8 isn't a huge difference, but every bit helps =)

I'm not sure if they sent me the email in error, or if they send it to all students with Direct Loans... would they even let me "consolidate" 3 loans which all have Exactly the same rate, from the same lender? The weighted average would obviously be 6.8!

I hate loans😕

Yeah, the idea is you get a new rate, a higher one that is, and then they extend it out from a 10 yr note to a 20 or 30 yr, thus lowering your payments.

 

[AMDFAO]

Your rate with Direct is fixed at 6.8 so there won't be a rate change from in school to grace to repayment. Get online to your account www.dl.ed.gov to verify they are all fixed 6.8 first and get a good understanding of your options before selecting or consolidating.
If you elect to consolidate, your rate would be the weighted average of 6.8 rounded to the next 1/8 percent or 6.875. I think you'd be raising your rate by .075 for naught...
Look over the repayment plans since they are a bit different for borrowers prior to 2007, consol loans vs non-consol loans (they're a bit whacky the way they are presented but there's a difference in the length of repayment etc. If you were in repayment prior to 9/2007 there are old repayment plans up to 30 years you may not need to select-- get into the DL homepage and read it over carefully). I'm certain DL just sent out the email to all their borrowers soon to enter their grace.