Co-signer:

• Is a joint signer of a promissory note
• The addition of a credit worthy co-signer helps to improve your loan terms.

Consolidation:

• Is the process of combining loans together to have a single lower monthly payment.

Interest

• An expense of borrowing money that is calculated as a percentage of the amount borrowed

Principal Balance

• The amount owed on a loan or loans at any given time. The principal balance may include capitalized interest.

Repayment Period

• The period during which a borrower is obligated to make payments on his/her loan(s)

Capitalization

• Adding accumulated interest to the principal balance, increasing the total cost of the loan.
• Less frequent is best
• Filing deferment forms late may result in capitalization earlier than expected
• Know when they capitalize interest on your loan -- it may be before your grace period is over!

Prime Rate:

• An interest rate formally announced by a bank to be the lowest available at a particular time to its most credit-worthy customers.

We used Prime rate as outlined in the Wall Street Journal, which is made up of the consensus prime rate of the 30 largest banks.