hi heather! do the feds publish the new interest rates before the changes switch over on july 1? i want to know whether to consolidate before or after the change.

thanks!

I’ve asked around some of my colleagues and here’s what I’ve been able to find out:

The new rate for a loan in an in-school deferment or grace period is the 91-day t-bill plus 1.7%.  If the loan is in repayment or forbearance, the new rate will be the 91-day t-bill plus 2.3%.  The current 91 day t-bill rate is .05%.  So, if the rate were to be reset today, the new rate would be 1.75% (1.7+.05) for the in-school or grace rate and 2.35 (2.3+.05) for the repayment or forbearance rate.

The new rate will be determined according to the t-bill rate on the last Tuesday of May:  http://www.treasurydirect.gov/RI/OFBill

You can get a sense of the t-bill trends at http://www.bankrate.com

And also, consolidation applications that are submitted around the time of the rate change have historically been held in order to allow borrowers to take advantage of a rate reduction if one occurs on July 1.