With the costs of higher education soaring in this country, many families are struggling like never before to send their children to college. Since 2001, tuition and fees at four-year public colleges have increased by 40 percent and the typical student borrower now graduates from college with a record $17,500 in education debt.

To help students and parents save on student loan costs, I want to make families aware of a time-sensitive opportunity to save thousands of dollars on interest. Starting on July 1, 2006, interest rates on outstanding loans rise to their highest rate in six years. Students and parents can avoid this increase by consolidating their separate loans into one, and locking in a low fixed interest rate by or on June 30.

On July 1, the U.S. Department of Education adjusts its yearly interest rates on outstanding college loans. This year, interest rates on student loans are expected to rise to over 7 percent and interest rates on parent loans are expected to rise to 7.8 percent. Eligible student borrowers who consolidate their outstanding loans by June 30 can lock in an interest rate as low as 4.75 percent, which would save an average of nearly $3,500 over the life of the loan. Parent borrowers who consolidate by June 30 would be eligible to lock in a rate as low as 6.1 percent over the life of their loan.

Given escalating college costs, I encourage students and parents to take advantage of this opportunity.

So how do you go about consolidating college loans?

If you have a Direct Loan through the Department of Education, you can call 1-800-557-7392 or apply on-line at http://www.loanconsolidation.ed.gov. If you have a loan through the FFEL program (a bank-based loan), you can contact one of the companies that own or service your student or parent loan(s). If you have loans with more than one lender, you can chose to consolidate through the Department of Education or with any lender that provides federal consolidation loans.

However, a word of caution! Students who have borrowed Perkins loans - which carry a fixed interest rate of 5 percent and offer loan forgiveness to graduates working in certain fields such as teaching or social work - should carefully consider whether consolidation is right for them. If Perkins loan borrowers consolidate their loans, they lose their loan forgiveness benefits.

While loan consolidation will help some families this year to lower college costs, I am also working in other ways in Congress to make higher education accessible to all able and willing students. My web site provides a wide-variety of resources, including a scholarship directory, at www.house.gov/roybal-allard and under "Making College Affordable." In addition, I am working with my colleagues in the House and Senate to pass legislation called the Reverse the Raid on Student Aid Act (H.R. 5150). This measure would reduce interest rates on college loans by half from 6.8 percent to 3.4 percent for students with subsidized loans - which go to students with the most financial need - and from 8.5 percent to 4.25 percent on parent loans for undergraduate students. Under the proposed Democratic measure, for example, the typical undergraduate student borrower with $17,500 in student loan debt would save $5,600 over the life of his or her college loans.

As your Member of Congress, I am committed to making sure everyone has access to a college education and the many opportunities the experience provides. With that in mind, I hope you find the above information helpful.

(Congresswoman Lucille Roybal-Allard's office offers a wide variety of services to the community, including financial aid workshops, a service academy workshop, a scholarship directory and constituent casework services to assist district residents in resolving problems with federal agencies such as the Centers for Medicare and Medicaid Services, the Social Security Administration, the Internal Revenue Service and the U.S. Department of Veterans Affairs. More information about federal services can be obtained by visiting Congresswoman Roybal-Allard's web site at www.house.gov/roybal-allard or by calling her district office at (213) 628-9230.)
 

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