Once your loans are combined into a Direct Consolidation Loan, they cannot be removed. If you want to lower your monthly payment amount but are concerned about the impact of loan consolidation, you might want to consider deferment or forbearance as options for short-term payment relief, or consider switching to an income-driven repayment plan.WARNING: It is very dangerous to consolidate federal loans into a private consolidation loan.You will lose your rights under the federal loan programs once you choose to consolidate with a private lender.You may be contacted by private companies that offer to help you apply for a Direct Consolidation Loan, for a fee. There’s no need to pay anyone for assistance in getting a Direct Consolidation Loan. The fixed rate is the weighted average of the interest rates on the loans being consolidated, rounded up to the nearest one-eighth of one percent.
Under the Direct Loan Consolidation Program, you can consolidate Subsidized and Unsubsidized Stafford Loans, Supplemental Loans for Students (SLSs), Federally Insured Student Loans (FISLs), PLUS Loans, Direct Loans, Perkins Loans, Health Education Assistance Loans (HEALs), and just about any other type of federal student loan.
Whom do I contact if I have questions about consolidation?
There is no cap on the interest rate of a Direct Consolidation Loan.
Loans that are not eligible for consolidation include state or private loans that are not federally guaranteed.
Although all of these different loans may be consolidated, you must have at least one outstanding FFEL or Direct Loan to obtain a Direct Consolidation Loan.
But while there are a growing number of options available to consumers, most student loan forgiveness programs and other repayment plans are only available to those with federal student loans.