Repaying student loans dogs many Americans long after they graduate, and a large number of recent grads apparently are unaware of an often effective tactic that could help pay them off: loan consolidation.
More than half of former students have not heard of the Federal Consolidation Loan Program, according to a survey by Fredericksburg, Va.-based Collegiate Funding Services (CFS).
Consolidation involves combining existing student loans into one and locking in an interest rate for its duration. Rates on federal student loans will drop nearly two percentage points for those who consolidate after July 1, to 4.06 percent.
The CFS survey also found 21 percent of loan-holders under the age of 35 were surprised by the dollar amount of their monthly payments when those payments came due. Nineteen percent said they were not prepared to make their monthly payments.
The CFS survey also noted that future college students will likely be looking at even higher loan expenses and said many will require loans.
Fewer than half of parents with precollege-age children said they expect to bear all or even some of their children's college costs.