Your Questions About Direct Loan Servicing

Nagesh answers:

Direct Loan Servicing is definately an option for you when you are considering consolidating your Federal Student Loans. Also, yes the Federal Government are the ones who regulate the interest rate on Federal Student Loans. The interest rate is established every July 1st of the year and is regulated by the T-bill.

Keep in mind, because Direct Loan Servicing is, in essence, the Federal Government they rarely pursue someone to consolidate their Federal Student Loans since they are so overwhelmed with the process of issuing Federal Student Loans. Because of this they task other companies to deal with the consolidation volume. The other companies the Federal Government tasks to do this offer the FFELP Consolidation Loan Program which is also regulated by the Federal Government so these companies must all follow the same rules and regulations as Direct Loan Servicing.

One thing the FFELP Consolidation Loan Programs offers is additional Borrower Benefits for those who qualify. The FFELP Consolidation Loan Program companies also offer their assistance in filling out your paperwork, which can be difficult at times. For more information on borrower benefits please visit the source below.

Nagesh answers:

Usually there are not incentives beyond the amount of money you’ll end up saving. Before you graduate you should have to undergo an “exit interview” for your loans, and they give you a lot of information there. If you don’t want to wait that long, sometimes the financial institutions that you are borrowing from will have information, so try asking them directly.

The government also offers advice and services here:
http://www.loanconsolidation.ed.gov/

Nagesh answers:

I don’t know if it’s a scam, to me it looks like a very expensive way to build credit (basically you put money into a savings account with them and then you can loan the money, thus building a credit history, all for very high fees).

Here’s a phone number: 973-854-1247 (from “The program”)

To cancel this is how that works (from the terms):
“15. CANCELLATION PROCESS: Cancellation procedures are as follows. (A) If you choose to cancel your account within the allotted time you may be entitled to a refund according to the terms listed in this agreement. (B) If you are not qualified to receive a refund you will be responsible for the full unpaid balance of service fees and your funds will be active for withdrawal from your account card. (C) If you wish to cancel your contract you may contact our cancellation department by e-mail us at customer service in the access account area. Cancellation is a $29.95 charge and will be debited from your account balance on your account card. ”

Of course you would need the customer service email address, it doesn’t seem to be on the website.

The company behind them is Webchex international inc (it’
s in the terms):
Webchex International Inc.
5348 Vegas Drive Suite 977
Las Vegas, NV 89108
The address is just the legal address of the company (it doesn’t seem to be their office), Eastbiz.com is their registered agent, http://www.eastbiz.com/, maybe they can/will tell you how to reach Webchex (not likely).

To find out if it’s a scam you can contact these guys:

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There’s been another question about them already: http://answers.yahoo.com/question/index?qid=20070504122936AAsupyK

Nagesh answers:

Q. I chose direct deposit for my 2007 tax refund but also requested a Refund Anticipation Loan (RAL) from my preparer. How does that affect my stimulus payment?

A. Taxpayers who use RALs or enter into any other loan or financial agreement with their tax professional cannot receive their stimulus payments by Direct Deposit and instead will get a paper check.

Nagesh answers:

Yes, you can start as soon as you wish.