Tentative Student Loan Deal Hits Snag

this website “Why are we charging our students interest on federal loans at all?” questioned Orman. “We are financing this bill on the backs of our future children and it’s a travesty,” she maintained. In this week’s episode of “The Suze Orman Show,” Orman gives callers and guests strategies to pay down their student loan debt. She also explains the nuances of the new interest rates that became effective in August. Federal student loan rates for 2013-2014* Undergraduate loans 3.9 percent Graduate student loans 5.4 percent Plus loans (parents and students) 6.4 percent *These rates are for new loans only and are fixed for the life of the loan. The rates for new borrowers will reset each July and are based on the 10-year Treasury note.
Source: http://www.cnbc.com/id/101085130

Consolidating those loans can eliminate some of the confusion, says financial aid expert Mark Kantrowitz, publisher of Edvisors.com. “Consolidation can make it easier to repay student loans by streamlining repayment and replacing multiple loans with a single loan,” Kantrowitz said via email. This is not a one-size-fits-all solution, though, and experts suggest graduates consider four things before consolidating. 1. What you owe: Borrowers need to understand more than just their loan balance.
Source: http://www.usnews.com/education/best-colleges/paying-for-college/articles/2013/10/02/student-loans-what-to-consider-before-consolidating

Congressional staffers are planning to discuss the matter on Friday, while members hope to meet next week. The tentative deal, which would have to pass a Senate vote, calls for interest rates on all government Stafford loans for students to be pegged to rates on the 10-year U.S. Treasury note, according to multiple sources close to the negotiations. The group will need to pass the Senate. After that, it has to clear the GOP-controlled House. Republicans have been keen on coming up with a deal that doesn’t add to deficits, while Democrats don’t want the government to make money off students.
Source: http://money.cnn.com/2013/07/11/pf/college/student-loans/index.html

No business like student loan business: Four companies in Aberdeen process, collect loans

(Payment percentage rates vary widely, but it isnt uncommon for a borrower to pay nothing.) If $45,000 of that borrowers debt is a federal loan with 6.8% interest, and the borrower didnt make any payments on those loans, the balance would grow to $60,300 after five years, said Mark Kantrowitz, publisher of Edvisors.com, an education-finance information provider. The remaining $10,000 in private loans, with an interest rate of 10% and capitalization at the end of the bankruptcywhen accrued interest is added to the principalwould grow to $16,000, he said. That means that even without adding late penalties or collection fees, the borrowers student-loan balance would have grown to $76,300. Bankruptcy attorneys say that even though borrowers might face higher loan balances at the end of a Chapter 13 case, many still choose to file, for instance to save a home from foreclosure. The existing bankruptcy rules are meant to prevent people from paying down their student loans at the expense of other consumer debts, which are supposed to be repaid at the same rate.
Source: http://blogs.wsj.com/bankruptcy/2013/10/01/how-bankruptcy-can-send-your-student-loans-soaring/

How Bankruptcy Can Send Your Student Loans Soaring

Located in Aberdeen’s Industrial Park, Progressive plans to add 15 more employees by the end of this year and 25 employees in 2014, Perry said. Wells Fargo will open a student loan collection center in December. The office, which will employ 20 workers, will share space on the third floor with Wells Fargo Auto Finance in the Blackstone Development Building on South Main Street. Rather than collect loans directly issued or backed by the government, Wells Fargo will collect private student loans, which originated at Wells Fargo lending institutions. Troy Holtey, 38, has been named the manager of the new branch.
Source: http://www.courant.com/news/aan-no-business-like-student-loan-business-four-companies-in-aberdeen-process-collect-loans-20131006,0,2468090.story

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