Welcome Meharry Loan Consolidation Primer

Introduction

Education Association Services (EAS Group,LLC)developed the Meharry Loan Consolidation PRIMER – for Post June 30th 2005 Consolidations to help YOU understand and execute strategies to lower the cost of your education via navigation of the complicated and byzantine world of student loans before these cost savings opportunities are lost. More-

Consolidate Now!

The Meharry Loan Consolidation Program urgently recommends that all students should consolidate now, even those who will still be enrolled after July 1, 2006. Unless you and/or your loans meet the criteria for loan cancellation, discharge, forgiveness or repayment from some other source, you should immediately consolidate all of your fully disbursed eligible Federal student loans and lock in low simple fixed interest rates and protect against expected future rate increases and likely legislative changes that will increase the cost of your education while you are still permitted to do so. It is most important to understand that even with the July 1st 2005 rate increase; Federal student loans and student loan consolidation remain an outstanding financial bargain! There are few if any reasons and virtually no valid economic rationale not to consolidate. More-

Current proposals from both houses of Congress would make consolidation more expensive by levying one-time fees and increasing interest rates for Stafford loans, essentially taxing financially vulnerable students and graduates. Proposed legislation also includes provisions that would prohibit reconsolidation and in-school consolidation as well. More-

If you have unconsolidated student loans, you should educate yourself and identify your individual options now!
Consolidating now enables students and parents with Federal PLUS loans to lock in current low fixed interest rates for the life of the loan regardless of future interest rate or legislative changes.
Borrowers who consolidate their loans before the effective date will be grandfathered in.
In-school borrowers generally should NOT include Perkins loans, HPSL and LDS loans in their in-school consolidation because these loans lose their interest subsidy if consolidated. Subsidized Federal Stafford loans continue their subsidy when consolidated.
Continuing students will have to abide by any legislatively authorized program changes, pay prevailing rates on subsequent post-June 30th 2006 loans and consolidations.

For those who graduated, did not consolidate and your six-month grace period has expired, you should consolidate immediately – significant savings are still yours to have! More-

If you wait until July 1st 2006 to consolidate, you are leaving yourself vulnerable to any interest rate or legislative changes to the program, which are nearly certain to take place. Proposed legislation if enacted is anticipated to become effective 2006.

“Consolidating at current rates on whatever loans you already have could save you a small fortune in interest.” – Student Borrowers Must Consolidate Now, TheStreet.com

Terry Savage, registered investment advisor, nationally known expert on personal finance and commentator on CNN, CNBC, PBS, and NBC.

What Every Student and Graduate Should Understand Know and Do

Minimum borrowing as a student coupled with low student loan consolidation rates lowers the cost of education and releases discretionary income in your repayment years. This strategic and financially savvy approach to financing your medical education can give your financial future a significant boost by requiring lower interest payments thus making more of your earnings available to you to start your saving and investing efforts earlier in your career. Having more discretionary funds to save and invest allows compounding interest to work longer and harder in your favor by building your net worth. Combined with money management knowledge and savvy financial behavior, consolidation represents the key to personal and professional success and happiness.

For a limited time – prior to July 1st 2006 and possibly sooner - one option, student loan consolidation remains available for students, graduates and parents to protect themselves against significant changes in the cost of their loans. The U.S. Department of Education (ED) authorization for FFELP lenders to do in school consolidation as of this writing (January 2006) expires March 31st 2006. Medical students should understand that although ED has authorized FFELP lenders to do in-school consolidations through March 31st 2006 the lenders are not required to grant a borrower’s request to enter repayment status early.

Some private FFELP lenders have been reported to stop honoring in-school consolidation request well in advance of the March 31st 2006 expiration date. If your lender refuses to allow you to enter repayment status early in order to do an in-school consolidation prior to March 31st 2006 then it is strongly recommended you follow a “Super Two-Step” strategy. With a Super Two-Step you first consolidate with the Direct Consolidation Loan Program and then reconsolidate with the Meharry Loan Consolidation Program or another program of your choice.More-

Consolidating while in school also means that a variety of loan amounts will be presented for consolidation. As such we suggest the following:

For loan amounts less than $20,000 (Up to $19,999):

Consolidate with the Direct Loan Consolidation Program - 1-800-557-7392 Borrower Benefits.

For loan amounts greater than $20,000 ($20,000 and above):

Consolidate with the Meharry Loan Consolidation Program or a Lender of Your Choice - 1-800-741-4704 Borrower Benefits .

For graduates, it is important to understand the value and benefit of consolidating before the expiration of your six-month grace period. If you wait until the expiration of your six-month grace period to consolidate you will pay significantly more in interest. More-

The PRIMER has been developed to assist you in identifying and understanding consolidation post-July 1st 2005. The PRIMER has been created to provide you with background, insights, guidance and strategies to help you intelligently navigate and determine how student loan consolidation may best serve you in this Post-June 30th 2005 student loan and consolidation era.

First, all physicians-in-training should keep in mind that to take advantage of the current student loans and consolidation state-of-affairs and keep the cost of repaying your loans manageable and supportive of your professional and personal goals depends on two key factors:

1. whether you have consolidated or not; and

2. your personal and professional financial objectives, preferences and debt and money management skills and behavior.

Second, because consolidation is unique to each borrower it is impossible to present all potential consolidation circumstances and strategies. However, the PRIMER has identified the likely scenarios and situations most medical students and graduates may now or in the near future encounter.

Click on the appropriate headings below, those most like or similar to your situation or questions, for more detailed information about what you should know and do about consolidation and lowering the cost of repaying your student loans.

[1] you graduated before July 1st 2005 and:

	a. consolidated b. did not consolidate c. did not consolidate with a single or multiple lender

[2] you graduated or will graduate between July 1st 2005

	a. consolidated after July 1st 2005 Graduation b. not consolidated -- will graduate by June 30th 2006 c. consolidated all eligible loans with in-school consolidation d. completed in-school consolidation with additional outstanding eligible unconsolidated loans

[3] you will continue in school after July 1st 2006 and:

	a. you have completed in-school consolidation with additional outstanding eligible unconsolidated loans b. must choose a “blended” single consolidation or two or more new “separate” consolidations c. you have a single or multiple FFELP Stafford lenders/holders and have NOT Consolidated

[4] a financial expert's advise

[5] help