Student Loan Consolidation

Consolidating your student loans may help you to manage loan repayment; here are the pros and cons: Why Consolidate?
The Advantages and Disadvantages
Consolidation brings benefits and costs. Consider the following before you decide whether consolidation is right for you.

Some Advantages of Consolidation
– Your loans will have a fixed interest rate based on the rates of the underlying loans (see chart at “Interest Rates”).
– You’ll have 1 convenient payment per month to 1 lender, instead of multiple payments to different lenders.
– Your new maximum repayment term is based on the total loan amount and may be from 10 to 30 years, depending on the repayment plan you choose.
– You may be eligible to benefit from Public Service Loan Forgiveness or additional subsidies available to some active duty military personnel.
Some Disadvantages of Consolidation
– Due to the fixed interest rate, you will not benefit if the variable interest rate goes down.
– You may repay your loans for a longer period of time.
– You may accrue and pay greater interest over the long term. This greater interest may increase the total balance of your loan, potentially by thousands of dollars (see charts at “Interest Rates”).

– If you are looking for a lower monthly payment, you may want to consider other repayment options before consolidation.


– Your weighted interest rate will be rounded up to the nearest ⅛ of a percent (0.125).
– You may lose some existing benefits on your loans, including Perkins loans, that you choose to consolidate.
The best way to understand how consolidation will change your loan is to look at the way interest accumulates and how it impacts your repayment.

Parent PLUS borrowers can also take advantage of federal loan consolidation. In addition to consolidating the PLUS loans you have taken for your children, you can also consolidate your own student loans with your Parent PLUS loans or Grad PLUS loans. However, you may not consolidate your loans with your child’s loans