Students can save a significant amount of money by consolidating their student loans now rather than waiting until next year.

“This is something that should pique a lot of peoples’ interest,” said David Stout, College of Business senator for the Government of the Student Body.

Kyle Krause, GSB Frederiksen Court senator, said GSB has started a campaign to raise awareness among ISU students about the low interest rates.

Stout said students with Stafford and other loans should consolidate their debt before April 1 to guarantee themselves an interest rate of 2.77 percent.

This is the lowest federal student loan interest rate in three decades, he said.

Students who fail to lock in this interest rate before next school year could see the rate rise to 4.62 percent, he said.

Stout said he estimates the average student with a $10,000 Stafford loan with a 10-year payment plan would save more than $1,200 by locking in the current interest rate.

He said students should act quickly to guarantee that the Department of Education has time to process the request before July.

“Acting by April will allow for a 90-day window before the July 1 deadline,” he said.

Krause said if students consolidate their loans federally, they can later shop around with private firms that offer loan consolidation services to try to reduce their rates even further.

Krause said the process of locking in the low interest rate is as simple as making a phone call.

“Students interested in the lower rates who have attended only direct lending schools, like the three regent universities, just need to call a Department of Education phone number and give some information,” Krause said.

“They’ll then get a promissory note sent to them. They just have to sign it and send it in.”

Students who have not always attended the direct-lending schools, like Iowa State, have to fill out an online application at the education department’s Web site, but they still qualify for the same interest rate, Krause said.

All students receiving financial aid were sent notification e-mails, but Krause said students tend to gloss over the messages.

To remind eligible students to take advantage of the lower rate, Krause said GSB has been handing out fliers and giving short presentations in classes.

He said GSB is hosting a phone-in day on Friday at Parks Library where students can make the phone call to lock in the interest rate.

“There are no disadvantages,” Krause said.

“All eligible students can and should do this.”

ISU officials are also encouraging students to consolidate their loans now.

Roberta Johnson, director of financial aid, said she sees no downside associated with consolidating.

“The federal government will adjust the interest rate on July 1,” Johnson said.

“All indications say the new rate will probably approach 5 percent. Rather than having that variable rate, students should lock in this historically low rate.”

She said a series of one-hour loan consolidation workshops are being held this week to help students lock in the low interest rate. The first two sessions are scheduled for 3:30 p.m. and for 5:30 p.m. Wednesday in room 101 of Carver Hall.

The third workshop is scheduled for 2:30 p.m. Thursday in room 1 of Carver Hall.