Consolidating student loans from several lenders
Always talk to your servicer before making a choice. You can select between the Standard Repayment Plan, Graduated Repayment Plan, Extended Repayment Plan, or one of the 4 income-driven repayment plans.
You will have to complete an additional plan request form for the plan you choose. After signing and submitting it, it generally takes about 2 months for the new consolidated loan to be disbursed.
Tip: Before you consolidate any student loans, talk to your loan servicer.
You can revisit any benefits you may have forgotten about. Weigh the pros and cons of leaving the loans alone or consolidating.
If you want to work towards loan forgiveness, be careful.
Including certain loans, such as the Parents PLUS loan, may make you ineligible.
Remember, to qualify for federal loan consolidation, at least one of your loans must be a Direct Loan.
Consolidation won't lower your interest rate, but you can lengthen the term of your loan, thereby lowering your monthly payments.
You will also retain the ability to apply for loan forgiveness, deferment, and forbearance in the future.
You help support Credit Donkey by reading our website and using our links. The Department of Education pays off your current loans and starts one new bigger loan.
Why You Should Consolidate Your Student Loans: Do you have federal student loans with different servicers and several monthly payments? Consolidation refers to combining federal student loans, while refinancing refers to getting a new loan from a private lender with a new rate and term. You pay one monthly payment versus many payments of varying dates and amounts.