How do they calculate the annual interest rates for student loans?
Written By: aaren on December 8, 2009
2 Comments
Can anyone help me with this? I’m a college student and I’m going to study in Canada as an international student and I’m going to get a student loan with a co-signer. I’m trying to figure out how they calculate their rates. Which Prime rate and LIBOR rate do they pick? And how do they add the fees to the annual rate and all that stuff? I really need to know how it goes.
Thanks
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Tags: canada, co signer, libor rate, prime rate, student loan
Student loan interest rates and fees really depend on the type of loan you’re taking out. It also depends on your credit rating.
Generally speaking, a fixed interest rate for Stafford Loan is at 6.8%. A PLUS loan is currently at 8.5%.
A Student Signature loan’s rate is based on the prime rate (and rates can be +/- 1%)
Everything I’ve seen right now seems kind of high, so you’ll probably want to consolidate all of your student loans at some point.
Right now, loan consolidation products run from about 4.75% to 6.125%.
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