TEXAS TECH — Students can expect to pay less for student loans starting July 1 due to the recent 2.2 percent drop of interest rates on some federal loans.
Only students accepting loans this fall or who are scheduled to start paying loans after July 1 will benefit from the low rate.
For students with subsidized loans, the federal government pays the interest while the student is in college and for a grace period of six months after graduation.
Students with unsubsidized federal loans are responsible for paying the interest while in college and during the grace period.
The Stafford loan rate while in school dropped from 7.6 to 5.4 percent and the rate during repayment dropped from 8.2 to 6 percent, said Becky Atkin, Texas Tech financial aid advisor.
“It benefits the students because the interest is going to be smaller and it will make the payments smaller as well as the total amount to pay,” she said.
Becky Wilson, Tech associate director for financial aid, said the new rate is the lowest in years and can also be used to consolidate loans.
The consolidated interest rate would be the weighted average interest rate of the loans consolidated.
“Especially if deferred, but even if unsubsidized, it’s an excellent time to do this and be locked in for a year,” she said.
Rates are reevaluated by the federal government every year and are set not to exceed 8.25 percent.
“It is a big rate drop, which is nice because it was getting up there, so this is a good drop,” Atkin said.
Students can apply for financial aid at any time.
Students who have received an award letter should sign and return it to the financial aid office to prevent delays in award disbursement.