Citizens Bank issues a reminder Monday that federal student loan rates are expected to rise for the first time in five years this week.
Citizens said in a release that federal education loans such as the Federal Stafford and PLUS Loans are scheduled to increase up to 70 percent on July 1.
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Michael McFarlane, director of education finance at Citizens, said the bank encourages those with educational loans to stay abreast of options available before the interest rate increase.
“Taking steps such as consolidating into a lower, fixed-rate loan could mean tremendous savings,” McFarlane said.
Consolidating means consumers can merge several types of student loans with differing repayment terms into a single loan. On July 1, the interest rates on Stafford loans are projected to jump 2 percent to 4.7 percent.
Though June 30, Citizens is offering fixed rate loans with rates beginning at 2.625 percent for Federal Stafford Loans
Consumers may contact Citizens’ Education Finance Department at 800-708-6684 with any questions.
Interest rates on Federal Stafford and PLUS Loans are variable and reset each July 1. They are based on the 91-day Treasury bill, plus a margin of interest set by federal regulation.
