Consolidating student loans federal program
While the interest rate on the new loan may be lower than the higher interest rate, it will also be higher than the lower interest rate you're currently paying.
So overall you'll be paying about the same or perhaps just slightly more for your new, consolidated loan.
Before you consolidate your student loans, crunch the numbers.
Consider how much longer it will take to repay the new loan and how much more in total interest you will have to pay as a result.
In 1998, the United States Congress changed the interest rate to the aforementioned fixed rate weighted mean, effective February 1, 1999.
If your lender does not provide any benefits, you may want to consider consolidating your loans with a lender who does.
If you have private student loans at differing variable rates of interest, you may be able to consolidate and get one new loan with a fixed rate of interest—a good move if rates have dropped significantly since you were in school.
Instead of having multiple loans and loan payments, you have only one.
You can consolidate all federal student loans and most private student loans.
The fixed interest rate is calculated as the weighted average of the interest rates of the loans being consolidated, assigning relative weights according to the amounts borrowed, rounded up to the nearest 0.125%, and capped at 8.25%.