Last Chance to Save with a Federal Direct Consolidation Loan

(www.loanconsolidation.ed.gov)

Federal Direct Consolidation Loans at 4.7% (in-school interest rate) on Direct Loans borrowed since 1998 are available to student borrowers currently attending Western. The Direct Loan interest rate will rise to a fixed 6.8% on July 1, 2006. You must apply before June 30, 2006, to lock in the “in-school” interest rate of 4.7%

Before you consider other loan consolidation offers, make sure you know the answers to the following questions, and, read the fine print prior to signing any loan consolidation agreement:

· Will you retain your six-month grace period once you leave school?

· When will your loan repayment period begin?

· Will you retain deferment and cancellation benefits?

· In addition to incentives offered by lenders, will you continue to retain the 1.5% rebate you received when your Direct Loans were disbursed?

A Federal Direct Consolidation Loan offers the following benefits:

· Only Direct Loan Consolidation offers in-school loan consolidation and this benefit goes away on July 1, 2006.

· With in-school loan consolidation, you retain your six-month grace period when you leave school or stop being enrolled at least half-time. During the six-month grace period, interest does not accrue on your Subsidized Direct Loan and you are not expected to make payments until the grace period ends.

· Most deferments and cancellation provisions remain the same as the Direct Loan you received.

· If you make the first 12 payments on time, you retain the 1.5% rebate you received when your Direct Loans were disbursed.

· The Direct Consolidation Loan also offers an additional .25% interest rate discount for electronic payment.

Best time to apply: after your Spring loan disbursement, but before the end of April.

Whether or not you combine this year’s consolidation with past consolidation loans, you must consolidate this year’s loan amount while you are enrolled in order to lock in the current low interest rate of 4.7% and retain the six-month grace period. If you consolidate during the six-month grace period, but before July 1, 2006, you will retain the 4.7% interest rate; however, the loan will become due in 60 days and you lose your remaining grace period.

NOTE: The Federal Direct Consolidation Loan program does not solicit consolidation loan applications. Application is made directly to the federal government at www.loanconsolidation.ed.gov or by phone at 1-800-557-7392 (TDD 1-800-557-7395, Monday through Friday from 8 a.m. to 8 p.m. EST.)