With the July 1 interest rate increase looming on the horizon, student loan providers such as Access Group, the nonprofit graduate loan specialist, are preparing for a flurry of Federal Consolidation Loan applications. Based on Department of Education guidelines, lenders are able to use the current lower interest rates when calculating the fixed interest rate for a Federal Consolidation Loan, provided the borrower's completed application is received by the lender before July 1, 2006. At Access Group, this commitment to ensure that borrowers receive the lowest possible rate is called the "Rate Lock Promise."

Access Group also reminds student borrowers, who want to consolidate now to lock in today's low interest rates but who will still be in school on or after July 1, 2006, that they must complete two distinct steps by June 30, 2006, in order to consolidate their eligible federal loans:

* Contact each of their current loan holders/servicers and request that

the federal student loans they want to consolidate be placed into early

repayment; and

* Submit a Federal Consolidation Loan application to the lender with whom

they want to consolidate.

"We're concerned that in-school borrowers may not be aware that both steps must be completed in order to obtain the current low interest rate," says Jeffrey E. Hanson, Access Group's director of borrower education. "If they fail to complete both steps by June 30, 2006, they'll have to wait until they leave school to consolidate due to recent changes in federal law. And by then, interest rates could be even higher than they will be starting July 1, 2006," Hanson continues.

"Borrowers also should understand that lenders are not required to honor a request to put loans into early repayment and some lenders will only do so reluctantly. So, borrowers should contact their loan holder(s)/servicer(s) as soon as possible to avoid delays that could jeopardize their ability to take advantage of the current low interest rates," says Hanson.

Students can visit http://www.FederalConsolidation.Org for more information or to apply for a Federal Consolidation Loan from Access Group. Those who have already graduated and who have eligible federal student loans to consolidate also need to be sure their consolidation application is received by their lender by June 30, 2006, if they want to avoid the interest rate increase that will go into effect on July 1.

About Access Group

Access Group, Inc. is a nonprofit organization that has specialized in providing graduate and professional student loans for 21 years. Its products include federally guaranteed (FFELP) loans and private loans for students financing their law, business, medical, dental, health and other graduate degrees. Access Group also creates custom loan options and university-wide programs for schools to meet the unique needs of their students. The company offers flexible repayment options for all loans, as well as the Federal Consolidation Loan program. Access Group also provides borrower education materials and need-analysis services for students and financial aid administrators. For more information about Access Group products and services, visit http://www.AccessGroup.Org. For more information about federal loan consolidation in particular, visit the special Web site created by Access Group at http://www.FederalConsolidation.Org.

Source: prnewswire