Federal Student Loan Interest Rates Drop to Historic Lows; Southwest Student Services Corp.

Business Editors

GILBERT, Ariz.--(BUSINESS WIRE)--May 28, 2004

Federal student loan interest rates will fall to record low levels on July 1, 2004. Rates for federal consolidation loans will continue to be well below 1% through incentives offered by Southwest Student Services

When annually adjusted interest rates on student loans drop again on July 1, Southwest will offer borrowers the lowest possible rates on federal consolidation loans, allowing them to save thousands of dollars and significantly lower their monthly payments.

Arizona or Florida borrowers who consolidate their student loans will receive an additional 2.25% discount after 24 months of on-time payments and for using auto-debit, resulting in a possible interest rate of 0.625%. All other borrowers are eligible to receive a 1.25% interest rate consolidation loan discount by using auto-debit after their first 24 on-time payments.

"This is great news for students who financed their education through federal student loans," said Southwest Chairman and CEO Vince Roig. "With our added discounts and benefits, we are offering some of the best rates in the country, which means that borrowers can make lower monthly payments and save large amounts of money on their student loans. For example, a borrower with a $25,000 consolidation loan could save nearly $6,000 over the life of the loan with these new rates."

College graduates can lock in very low rates by consolidating their loans during the grace period, when interest continues to accumulate even though at a lower rate than during the regular loan period. Parents who have secured federal PLUS loans to pay for their children's education will also benefit from lower interest rates, and they can also realize significant savings through PLUS loan consolidation. Loan consolidation applications sent in now will be processed to take advantage of the new, low-interest rates that take effect for 2004-2005.

The application process can be completed in just minutes online at www.sssc.com or by calling Southwest customer service at 800-367-2369. There are no fees, no service charges, no credit checks, and no prepayment penalties for consolidation loans.

About Southwest Student Services Corp.