College Loan Corporation Says It's Official: Student Loan Rates Fall to Record Lows

Business Wire, May 24, 2004

Business Editors/Education Writers

SAN DIEGO--(BUSINESS WIRE)--May 24, 2004

Today's Treasury Bill Auction Confirms New Federal Rates

It's now official: federal student loan rates for 2004-2005 will fall to new, all-time lows, bucking other interest rate trends. The new rates, which fell slightly from already-historic lows, will mean substantial savings for college students and graduates.

The rates, calculated by the Department of Education based on this afternoon's 91-day Treasury bill auction, will go into effect on July 1. Stafford (student) loan rates will fall .05% to 3.37%, while PLUS (parent) loans will fall .05% to 4.17%. Recent graduates who consolidate their loans during their "grace period" - the six months following graduation - can benefit from fixed rates as low as 2.875% for the duration of their payments.

"With the soaring costs of attending college, these new, low rates will come as welcome relief to millions of American families," said Mark Brenner, executive vice president for College Loan Corporation. "The Class of '04 can now consolidate their student loans and lock in these low rates for the life of their loan."

A graduate who locks in at the new rate will save over $2,700 on a $20,000 loan repaid over 10 years, versus recent historical Stafford rates. Graduates who lock in before the end of their grace periods will save an additional $556 on the same terms.

The following chart displays the rates on the most popular federal student loans.

Loans                                 2004-2005    2003-2004   Change
                                        Rate         Rate
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Stafford                                3.37%        3.42%     -0.05%
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PLUS                                    4.17%        4.22%     -0.05%
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Consolidation                          3.375%        3.50%     -0.13%
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Consolidation (during grace period)    2.875%       2.875%     0.00%
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Families who would like additional information on benefiting from these rates can call College Loan Corporation. College Loan Corporation offers free advice to students and families seeking financial solutions to meet their higher education goals. Expert loan consultants are available 24/7 at 1.800.2COLLEGE.

About College Loan Corporation

College Loan Corporation, based in San Diego, is the nation's seventh largest student loan provider. The Company has originated more than $9 billion in student loans to more than 400,000 borrowers, making it the fastest-growing top-tier Stafford and PLUS loan provider in the country. The Company makes higher education possible through innovative loan products and industry-leading, first-class customer service. College Loan Corporation offers the nation's best student loan advice line answered by expert loan consultants 24 hours a day, 7 days a week at 1.800.2COLLEGE. For more information on College Loan Corporation, visit www.collegeloan.com.