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Home

 Loan Consolidation

Home > Students & Parents > Federal Loans > Loan Consolidation

Loan consolidation is a loan program which was designed to simplify a borrower's repayment of educational loans. Through consolidation, a borrower can combine eligible educational loans into a single Consolidation Loan requiring single monthly payments. Borrowers may reduce their monthly payments by extending the repayment period with a Consolidation Loan.

Loans Eligible for Consolidation

  • Federal Stafford Loans (formerly called GSL)
  • Federal Supplemental Loans for Students (SLS)
  • Federal Plus Loans
  • Federal Direct Loans
  • Federally Insured Student Loans (FISL)
  • Federal Perkins Loans (formerly called NDSL)
  • Health Profession Student Loans (Primary Care Loans)
  • Health Education Assistance Loans (HEAL)
  • Nursing Student Loans

Requirements

All loans consolidated must either be in a grace period or in a repayment status.

A borrower with delinquent or defaulted loans may be eligible for consolidation if the borrower will re-enter repayment through Loan Consolidation. A borrower in default must make satisfactory repayment arrangements with the holder of his or her loan to be eligible for Loan Consolidation.

Interest Rate

The interest rate results from calculating the weighted average interest rate of all loans being consolidated, rounded upward to the nearest whole percent.

Benefits of Loan Consolidation

  • The borrower pays single monthly payments;
  • The borrower can reduce his/her monthly payments by:

    • Increasing the number of years to repay the loan;
    • Using a graduated repayment schedule; and/or
    • Lowering the interest rate on a PLUS or SLS loan.

Last Modified: December 31, 2002 12:00:00 AM


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