Hello - I consolidated my federal loans a long time ago, well before 2006… It will take me a while to figure out exactly when but I got locked into a lifetime interest rate, which is very high (relatively), about 8%.  At the time, it was thought to be a good rate.  The loans were made up mostly of direct loans but also indirect federal loans.  I am wondering how to figure out if the attention that has since been paid to the weight of student debt on people like me, means that I may now be able to get a new rate of interest?  I’m not sure where to look for this advice and would appreciate any links you might able to give.

Secondly, I have worked a UK registered charity for the last 7 years and for a US 501(c)3 from 2000-2.  Might I be eligible for the public service debt forgiveness?

Thanks!

Hi, Expat.

You are not alone in locking in a fixed rate that at the time seemed good, but doesn’t look so hot any more.  There isn’t a way to improve your interest rate by consolidating or reconsolidating in a federal student loan program, unfortunately.  It is possible, but not necessarily the right move, to find another source of credit at a better rate that you can use to repay your student loan.  Perhaps, if your credit is good, you could borrow a personal loan or home equity loan at a lower rate.  Please be cautious, because your federal student loan has borrower protections like deferment and forbearance, plus cancellation provisions that you will not find in an alternate source of credit.

Thank you for your service!  Public Service Loan Forgiveness is earned by making payments.  You have to make the right kind of payments, on the right kind of loans, while you are in the right kind of job.  From what you’ve mentioned, it sounds unlikely that you’ve made payments that count towards forgiveness (since your 501c3 work was before the effective date of PSLF and your UK employment is unlikely to qualify).

Start by reading through Public Service Loan Forgiveness in 5 Easy Steps and the other one pagers on my tools page under Tools for Student Loan Borrowers, especially the Borrower Action Plan.  Also think about attending one of my free webinars.

Oh, and check out more information here: http://www.finaid.org/loans/privateconsolidation.phtml