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Question from MSIV (help me out)

NYC_anest_2004

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    I'm a 4th year medical student. I know that interest rates (when they are changed in June) will be higher than they are today. Thus, I would ideally like to consolidate my loans before the interest rates go up. I have heard that I can not consolidate my loans before graduation. Is that true? If I submit the application as soon as I graduate, can I consolidate my loans at the current (low) interest rate, and then apply to an economic hardship defferement? Thanks for the help.
     

    rhinosp_33

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      i've been lookin into this as well, so correct me if i am wrong, but .... what you can do is

      1.) chose the consolidation lender you want right now

      2.) submit paper work to them between now and may.

      3.) tell them to hold onto your application before the new rate is announced.

      4.) if the 2005 rate goes UP, then you use 2 months of your grace period (graduation in May --- until June 30th).... and have them finalize your consoildation on June 30th so you look in the cheaper rate.

      5.) if the 2005 rate goes DOWN, then you use all 6 months of your grace period (graduation in may --- until December) ... and have them finalize... etc to lock in the cheaper rate.

      6.) claiming forebarance /hardship can be down at the same time your consolidation paper is being done. its just one form, and you should request yoru lender to send it to you. beware, some lenders will not without your request. as such, after you consolidate, you will go into forebearnce/hardship as long as u qualified.

      any idea which lender your gonna chose, and why?
       

      VitaminK

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        I'm confused a bit still about consolidation and deferments. I keep hearing different things. If I consolidate, can I still defer? Do I need to do one before the other or can they be done together? I definitely will need to do both bc I have a lot of loans (~$250) and will not be able to afford to make regular payments during residency (however I do plan to pay on them some with leftover money) .
         
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        mpp

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          You can definitely defer before you consolidate (providing your loan payment vs. income meets eligibility creiteria). If you consolidate later it is likely interest rates will be higher.

          As far as defering after consolidation, you should check with the consolidation companies.
           

          rhinosp_33

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            MPP

            can you tell me which companies do not allow you to consolidate, then defer?

            i've personally talked with/read up on 3 lenders (THE, AES, SallieMae) who all allow deferal after consolidation..... am i missing something? or are there just other lenders which dont allow it, and if so which one?

            Thanks
             
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