You may also gain access to income-driven repayment plans and Public Service Loan Forgiveness that you wouldn’t qualify for otherwise.However, extending your loan term will increase how much interest you pay, and you may lose any benefits associated with your existing loans, including interest-rate discounts, principal rebates, Perkins loan cancellation benefits, and any credit you’ve earned toward income-based repayment or Public Service Loan Forgiveness.
Finally, while a federal consolidation loan retains your access to federal student loan benefits such as interest-free deferment on subsidized loans, it might not offer you the lowest interest rate.
If you do want to consider refinancing federal loans with a private lender – or if you’re looking for a lower interest rate or a single monthly payment on private loans – continue to the next chapter on private student loan consolidation.
Instantly view loan options from ,000 to 0,000 using our student loan refinance comparison tool.
Federal student loan consolidation is free; there is no application fee, and you don’t need to work with a private company that wants to charge you money to help you consolidate your loans. Most federal student loans can be consolidated, including Federal Direct Loans, Stafford loans (discontinued in 2010 and now made through the Direct Loan program), Perkins Loans and FFEL loans.
When you consolidate your loans, you can extend your repayment period to as long as 30 years, making your monthly payments lower.