Student loan borrowers who submitted incomplete applications and missed the July 1, 2006 deadline to consolidate student loans still may have a chance to receive a lower interest rate. Federal interest rates on student loans increased on July 1, 2006, but some borrowers may still be eligible to avoid the interest rate increase, according to NextStudent, the Phoenix-based education funding company.

Many student loan consolidation applications were not completed prior to the July 1, 2006 deadline due to the great demand for consolidation. Therefore, student borrowers who missed the deadline are making higher student loan payments since interest rates have jumped by 39 percent.

here is hope for borrowers in that the U.S. Department of Education as of July 1, 2006 extended the deadline for student loan consolidation to those borrowers who have a partially completed application on file with a lender. Numerous partially completed consolidation applications from incoming callers and online inquiries are on file at NextStudent. These applications were started prior to the July 1, 2006 deadline and many simply lack a signature. However, the Department of Education through its deadline extension is allowing these borrowers to consolidate at the pre-July 1, 2006 rates.