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Interest Rate Question
Started by SoCalDent
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those rate cuts affect EVERY loan you get. i'm sure you've heard this before..."your intrest rate will be PRIME + xxx%"....well that "prime" is the rate set by FED, so yes, those rate cuts will affect your loan APR
I was under the impression that loans like the Stafford and Grad PLUS loans (the ones most of us will be utilizing) had fixed rates and only changed every couple of years when these programs were reviewed by whatever organizational body controls them.
Hmm. Seems like they just recently raised the rate. I guess that means they will not meet again for some time?
That was basically what I was told at one of my interviews.
In the short term, it might be that cuts in rates may only affect us if they were cut so low that private loans ended up having lower rates than these fixed federal loan programs. But that isnt going to happen.
The Stafford loan rates are set at a fixed rate by law and have nothing to do with the FED interest rate cuts. A law must be changed to change the rate. On the other hand, private loans will possibly see a decrease, but no private loan is going to be under 6.8%, no matter what the FED does.
