Next month, the Department of Education will also move to help students consolidate existing loans, offering to bring them within the Federal fold as well.

When students consolidate loans, they combine multiple loans from different lenders into a single loan with one lender, often to reduce interest rates.

So those who consolidate loans after tomorrow, when the low rates kick in, can secure those rates permanently.

Under the plan, students consolidating several loans into one can choose between a fixed rate or a variable rate.

Parents, too, can consolidate loans, if they used them to finance the education of several children.

The plan will let borrowers consolidate their government loans and government-backed private loans into one monthly payment, at a lower interest rate.

Ms. Jones recalled that she also talked about "other loan companies" that would saddle students with unfavorable rates if they decided to consolidate loans on graduation.

For example, she said, students who take certain public sector jobs may sign away available benefits if they consolidate federal loans.

During this one (1) year period, borrowers who meet the following requirements may consolidate loans that are in an in-school status into a Direct Consolidation Loan.

Borrowers cannot consolidate defaulted loans under these conditions: