Q: I am not sure where to direct my question. I enjoyed reading material on your site and found it all very informative and helpful. My husband and I are both new attorneys (less than two years practicing) and we have a tremendous amount of law school debt. We struggle despite good salaries. We are essentially paying our mortgage twice. We spend a little over $2000 a month on our law school loans, including both federal and private loans. We have consolidated our federal loans and both have great rates (less than 2% fixed for 30 years). Our private loans are what get us. I have looked into consolidation but most offer variable rates and the math doesn’t add up to create an incentive to pursue a private consolidation with a variable rate. Do you have any suggestions? I cannot image that we are the only professionals experiencing this stress. Thanks for your time.
A: Due to the current credit markets crunch there are few programs which allow borrowers to consolidate their private education loans on the market today and the interest rates on the underlying loans remain variable. Most private education loan programs have multiple repayment options which could decrease your monthly payments but we advise you to check with your current lender or loan servicer. These programs give borrowers the ability to temporarily decrease their monthly payments for a given period of time. Other alternatives to refinancing private education loans would be through an outside line of credit or a home equity loan.
As Director of National Lending Associates, Inc. (NLA); and President of The Student Loan Processors, Inc. (TSLP); and Executive Vice President, Sales of Education Loan Source, Inc. (ELS) [wholly-owned subsidiaries of NLA]; Mary Jo Lambert-Terry offers more than 15 years of strategic management experience in the student lending industry. In her role as President of TSLP, Ms. Lambert-Terry oversees the day-to-day management and strategic direction, assisting students and their families with low-cost, comprehensive education financing solutions. As Executive Vice President, Sales of ELS, Ms. Lambert-Terry is responsible for managing the direction and marketing of its Custom Loan Source ProgramSM to regional and community banks.