Student-loan market adjusts to rising interest rates

Student-loan rates will jump July 1. The meaning of that for borrowers is clear: Consolidate your loans now, or go to financial detention for the next few years.

Lenders also are affected by the rate increases.
The Pennsylvania Higher Education Assistance Agency has hired 300 new staff members in its Harrisburg offices in the last 12 months, mostly to handle consolidation business that has boomed as interest rates move up, said spokesman Keith New.
"It was top of mind for ever), body," New said.
When they consolidate, borrowers bundle multiple loans into one at a fixed interest rate. A single loan can also be consolidated for die interest-rate benefit.
The impending interest-rate increase comes in two main parts.
Student loans issued before July 1 have variable interest rates that adjust annually. Those will jump to reflect the general rise in shortterm interest rates over the last year. By consolidating these loans by June 30, borrowers can lock in this year's interest rates for good.