Student Loan Articles

As experts on student loans and financial aid, we decided to provide some general insight for those interested in more about these topics. Feel free to distribute and link to these articles as appropriate.

Of course, if you have any questions about any of the information you see here, feel free to contact us!
List of Student Loan Articles

Types of Student Loans
Learn about the wide variety of student loans available for both undergraduate and graduate students.

Federal Student Loans vs. Private Student Loans
There are a number of differences between federal and private student loans. The Student Loan Network offers products in both of these categories.

Tips for Student Loan Consolidation
Find out how to consolidate your student loans in order to have smaller monthly payments.

How to Fund a Graduate Education
There are many loan options for those in graduate school, which include both federal and private loans.

Continuing Education Loan Overview
Interested in continuing your education after college? Learn about your options for financial aid in these circumstances.

FAFSA Tips and Mistakes
Many make mistakes when completing their FAFSA. Find out common errors and learn how to correct them with this expert advice.

Student Loan Glossary
There is a wide variety of terminology to learn when researching your student loans.

Tips for Inexpensive College Entertainment
Looking for ways to have fun in college without spending a lot of money?

Ways College Students Can Save for the Future
Everyday tips for saving your hard-earned money

Don't Pay for Help Finding Money for College
Learn which financial aid options should not cost you any additional fees.

Scholarships and Grants
One alternative to student loans is to apply for college scholarships and/or grants. These can offer you free money that do not have to be repaid.

How To Avoid Scholarship Scams
Watch out for these headlines from scholarship solicitations you may receive.

College Admissions Advice and Help NEW!
Did you know that your entire high school career affects which college you go to?

Tips for Student Credit Card Use NEW!
Interested in learning how to optimally use your credit cards - while in college?

State of the Financial Aid Industry
Following the allegations from NY Attorney General Cuomo, read what areas of the student loan industry should be watched closely.

School Loans Directory

A directory listing all school loans available to you at your college or university. Listed for each school will be all federal student loans and alternative student loans available at your school. The Student Loan Network offers a variety of student loans for students, always search for scholarships and federal student loans first.

Student Loan Application and Form Center

Welcome to the Financial Aid Officer Form and Application Center. Here you will find the most common forms you will need in relation to federal financial aid. We also can provide you with application forms for various loans.

All Students - to request an application form for Stafford Loans, Parent PLUS Loans, and Alternative Loans please:
Click here to Request a Loan Application
Financial Aid Help Forms
Financial Aid Checklist Worksheet - A helpful, printable form to keep track of what you need to do for Federal Financial Aid for the 2007-08 school year.
Application Form Tracking Worksheet - Keep track of everything with this easy to use form.
Cost of Attendance Worksheet - The cost of attendance is unique for each student. Use this sheet for personal calculations.
Award Package Comparison Sheet - School offering varying awards and differing packages. Use this comparison sheet to weigh your options!
Sample Scholarship Inquiry Letter
Loan Forms
Loan Forgiveness Form (Childcare)
Loan Discharge Form (Disability)
Loan Discharge Form (False Certification)
Loan Discharge Form (School Closure)
Loan Discharge Form (Teachers Forgiveness Program)
Direct Loans
Direct Loan Forbearance Form
Direct Loan Child Care Forgiveness Form
Direct Loan Economic Hardship Deferment
Direct Loan Repayment Plan Selection Form
Direct Loan Unemployment Deferment
Financial Aid Professionals

Scholarships and Grants Financial Aid Advice

The College Scholarship Search is sometimes overwhelming. Many students use scholarships to augment financial aid awards provided by their school. Every year, a sizeable number of scholarships have fewer students apply for them than they have money to give, meaning that there's still plenty of money not being awarded.

The most difficult part for many students is finding scholarships and grants. A quick check of Google indicates that for the search term "scholarship", there are over 3.2 million web pages to search through. How do you find the best ones?
We recommend our Student Scholarship Search website at StudentScholarshipSearch.com. Updated regularly, StudentScholarshipSearch.com contains many awards and details about how to apply, and best of all, it doesn't require you to give up any personal information in order to search the listings.
Be sure to check out our free eBook, Scholarship Search Secrets eBook, which details 11 methods for finding and winning scholarships.
We also have a site where you can register to win free scholarship money! ScholarshipPoints.com rewards frequent visitors as well as those who participate in the site's online surveys and contests. Every quarter we award lucky site visitors with free money towards their college or university.
ASk questions and help others find scholarship in our scholarship forums and discussion board.
The Importance of Scholarships
FREE Money
for College

Learn how to use
Internet search to
find scholarships.
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A scholarship is an award given to a student for the purpose of furthering their education. A scholarship can be a monetary award, or it can be an award of access to an institution. Scholarships are a vital piece of the financial aid system for three reasons:
They provide money which generally does not have to be paid back
They provide access to money which students may otherwise be ineligible for
When used in accordance with IRS guidelines, scholarship funds are tax-free

The second point is very important. Many scholarships are merit-based as opposed to need-based. There's a gap in education finance that isn't talked about a lot - the family that isn't poor enough to qualify for federal financial aid, but isn't rich enough to pay the cost of education without assistance. Scholarships can fill this gap along with private student loans. Obviously, because scholarships are money that does not have to be paid back, they're preferable to loans.

Edvisors Online Education Directory offers a variety of online education programs and financial aid options.

Financial Aid and Student Loan Introduction

The financial aid process can seem overwhelming and intimidating at first, but it's easier to understand once the process is laid out. Here, we'll walk you through the basics of the financial aid process step by step.
Financial Aid | Determine What You Can Afford

A college degree is likely to be the second biggest investment in any person's life after their home. Just as you'd take the time to shop around and do some research on a potential house to buy, so too should you invest the time to figure out what you can afford to pay for college. Do your personal budget, compare schools, and see what's affordable. Be sure to pay attention to the financial aid calendar so that you don't miss any important deadlines.
Read more on determining costs
Read more about the financial aid calendar year
Financial Aid | Scholarships and Grants

Scholarships and grants are your first stop in the process of finding money for college. Scholarships and grants typically never need to be repaid, and as such are the preferred form of financial aid if you can get them.
Read more about scholarships and grants
$10,000 College Scholarship from the Student Loan Network
FAFSA and Federal Financial Aid Paperwork

The FAFSA, or the Free Application for Federal Student Aid, is the single-most important form you'll complete in the financial aid process for unlocking federal student aid such as government grants and loans. The FAFSA is also dependent on the IRS Federal Income Tax Return; we'll review all of the information you need to know about education tax credits and deductions.
Read more about the FAFSA financial aid form
Read more about education tax credits
Read more about federal financial aid programs
Receiving Financial Aid

Once you've filed your FAFSA and applied for as many scholarships and grants as you're eligible to receive, you'll need to wait for financial aid award letters to arrive from schools. Once you receive them, you'll need to figure out what aid you will be receiving.
Read more about understanding financial aid award letters
Read the Blog - Negotiating your Financial Aid Award
Federal Student Loans for Students

There are three basic federal student loans that students may qualify for after completing the FAFSA. These are the Stafford federal student loan, the Perkins loan, and the Graduate PLUS Loan. Depending on what program of higher education you're enrolling in, loan limits and terms will vary.
Read more about federal student loans
Federal Student Loans for Parents

Parents who want to help undergraduate children afford college are also able to borrow federally guaranteed loans called PLUS loans (Parent Loans for Undergraduate Students) to help pay for college.
Read more about federal parent PLUS loans
Alternative Student Loans

When federal financial aid is insufficient, or education expenses exist outside of the coverage of federal student loans, alternative student loans can be used to "fill in the gaps" between federal financial aid and the full cost of education.
Read more about alternative student loans
Repaying Your Student Loans

The process of repaying your student loans is even more important than the process of obtaining them. Prompt, on time payment builds a positive credit history and helps you obtain additional credit in the years after your education ends. Missing payments or defaulting on loans can do the opposite. Happily, there are a number of different options to help you repay your student loans, from payment plans to loan consolidation.
Read more about payment options and plans
Read more about student loan consolidation
Other Edvisors Resources
Search for Scholarships at StudentScholarshipSearch.com
Free College Scholarship Contests at ScholarshipPoints.com
Online Education Degrees at Edvisors.com
College Search at HowToGetIn.com
Graduate Student Health Insurance at GradInsurance.com
Student Credit and Debt Center at StudentPlatinum.com
Search for Graduate Schools at GraduateCenter.com
Find Online Schools at Edvisors.com

There is a vast amount of information online to help you along the way towards securing the maximum financial aid available. Use our Financial Aid Forum if you have questions or need more personalized financial aid advice.

Free eBooks from Student Loan Network

Only seconds to download, with new topics added frequently

Student Loan Network offers many free eBooks covering a wide range of topics including completing the FAFSA, searching for scholarships, and reducing debt. These free guides help everyone from college bound students to recent graduates manage financial aid, save money, and get a head start after college.

Student Resources from Student Loan Network

Student Loan Network $10,000 Scholarship Drawing

Each quarter, Student Loan Network will give you a chance to win a $10,000 college scholarship simply by completing our semi-annual scholarship application for $10,000! No essays or recommendations required! Enter the $10,000 Scholarship Drawing »
Free FAFSA Help eBook!

PDF guide on how to fill out the Free Application for Federal Student Aid - and not miss a dime of financial aid! Many states have priority deadlines for state financial aid on March 1, so make sure you file your FAFSA as soon as possible!

Federal Student Loans - Pay for Tuition, Books and Supplies

Federal student loans help cover school expenses including tuition, fees, housing, books, supplies, and transportation. Two of the most popular federal loan options are the Stafford loan and Federal PLUS loan. Both loans offer a fixed interest rate, federal benefits, and can be used in combination to cover the full cost of your education. Click the links below to learn more about these great funding options.

College Student Loans

Student Loan Network educates students and parents on the best federal and alternative student loans and loan consolidation. Our goal is to provide you with the necessary knowledge and products to finance your education.

The Best Resource for Student Loans

Finding student loans for college can often be a difficult task for parents and students. Student Loan Network makes it easy by providing the best student loans, as well as the best student loan and financial aid resources on the web. Be sure to check out our student resources pages for financial aid tips, free downloads and the answers to your financial aid and student loan questions.
Resources for Financial Aid Professionals

Student Loan Network is proud to offer a full range of helpful, free financial aid resources that can assist in the financial aid process. We encourage financial aid professionals to share these resources with their students. Click Here to Learn More
Student Loan Help Blog
Practical Uses for a Private Student Loan

- By and large, the most common use for a private student loan is to help cover the remaining cost of tuition when federal loans and scholarships are not enough. But...
3 Great Private Student Loan Shopping Tips

- If you’re like me, you probably did not receive enough money in federal loans for the school year. I graduated this past December and know all too well how frustrating...

A Quick Consolidation Tip

Looking to consolidate federal and private student loans? While you can’t consolidate them together – and you wouldn’t want to anyway, you can take the consolidation of both types of loans to your advantage.

You can consolidate your federal student loans any time after you graduate or drop below halftime enrollment. Always consolidate federal loans first. Consolidating your loans will improve your credit rating, and when you go to consolidate your private loans, which are credit-based, you will have a better score and most likely get a lower interest rate.

Did you know you can get IBR on a Federal Loan Consolidation

It’s true! If you are unfamiliar with Income Based Repayment (IBR), I would recommend reading my blog and then consulting the Student Loan Network’s handy payment estimator chart under the new repayment plan.

Why is IBR better than the normal plan?

There are a couple reasons why. First, IBR takes your income into account when it computes what your monthly payment is going to be for your new consolidation loan. For instance, if you are single and make less than $15,000, you would actually qualify for $0 payments until your income rises closer to $20,000 per year. This income number actually goes up depending on how many people live in your household. Click the link above for SLN’s payment estimator chart for more details.

Second, under IBR you can actually have your loans forgiven and canceled after 25 years (20 starting after 2014) if you never miss a payment during the life of the loan. Kind of crazy, huh? This is a benefit that does not exist in the private student loan world and in some cases the forgiving period can actually be shortened. If you completed your degree in one of the Department of Education’s “hot fields” you can actually get your loans canceled in 10 years instead of 20 or 25…. and it doesn’t even matter how far along you are in paying for them.

Have a Consolidation Question?

If you aren’t already familiar with our Financial Aid Forum, it is an awesome resource for answering questions about virtually every kind of financial aid or loan a student can take out toward their education.

We have three dedicated Student Advocates (myself included) that are available Monday-Friday to help out and an informed user base of several hundred people. Between all of us, your question will be answered quickly and accurately (generally within a day or two).

Also, we have a great loan consolidation FAQ page that might be able to immediately answer any questions or concerns you have about the process.

As always, thanks for reading and make a post in our forum if you need help!

From Our Forums: Consolidation Question Quartet!

There was a great question in our loan consolidation forum this week from a new user with lots of loans from medical school. James recently finished his Master’s degree as a physician assistant (congratulations!) and wrote to us looking for some consolidation advice:

I have the following types of federal loans:
Subsidized Stafford
Unsubsidized Stafford
Grad PLUS
Previously consolidated federal loans from my Bachelor’s in Nursing (‘97-’01)

My questions are as follows:
Can I consolidate the above 4 types of loans together?
When should I consolidate? Before or after July 1st? Does it matter? (Grad school was from 8/07 – 12/09)
Who can consolidate? Are there any options now other then the federal government? Will there be lower interest options in the future?
I’ve read about the PLUS loan loophole. Should I consolidate my PLUS loans separately to save 0.25%?


Question 1: Can I Consolidate the 4 types of loans together?

Absolutely, through the Direct Loan Consolidation Program. Since the loans described are all federal student loan products, you can opt to consolidate them together through the Department of Education.

Question 2: When should I consolidate?

This question could go a number of different ways. Due to the fact that he finished school in December 2009, he is now almost 5 months into his grace period (6 months total) before his student loans enter repayment. Consolidation can take anywhere up to 45 days to complete (though usually is less), so logic would dictate that he should start the process soon.

I recommended that he begin his loan consolidation in early-mid May to take advantage of the grace period as long as possible. As soon as the consolidation is completed, the new loan immediately goes into repayment… so if you have time left that you don’t need to be making payments, take advantage of it and make a savings account or use the money elsewhere.

Question 3: Who can consolidate?

At this time, the only entity that is authorized to perform federal loan consolidations is the Department of Education’s Direct Loan Program. In the past, other banks and institutions were allowed to do this, but regulations and reform ended the practice.

As far as lower interest options in the future… who’s to say? My professional opinion is biased toward a yes answer due to the aggressive legislation happening in Congress, but the next question would be “when?”. As the popular adage goes, “Hindsight is 20/20.” My best recommendation is to take advantage of what is available on the market now and create a solid plan for paying down your debt.

Question 4: Consolidate PLUS loans separately?

This really depends on how many of them you have and if your PLUS loan debt is significantly higher than your Stafford/Perkins debt. If yes, then it might be a good idea to keep them separate and therefore not drastically increase the interest that would be paid on your other, lower interest loans. That being said, the point of a consolidation is to cut your bills down to one and make payments more affordable, isn’t it?

Keep in mind that when the interest rate is calculated for your consolidation, it is taken based on a weighted average of your current loan interest rates, not to exceed 8.25%. If the PLUS loans make up the highest debt volume, it might make sense to keep them separate.

How to Get Your Student Loans Forgiven

Imagine waking up tomorrow and discovering you don’t need to pay back your federal Stafford, PLUS and Perkins loans. For many Americans, that dream is a reality, thanks to a number of programs that allow you to have some, if not all, of your loans forgiven.

Aside from applying for a loan discharge, which is available only under extreme circumstances, some career paths and post-graduate options will cover the cost of repaying your student loans. Here is an overview of some of the careers that may take advantage of those options:

Public Service Employees: If you work full time in a public service position, and make 120 payments (approximately ten years) on your loans while employed, you may be eligible to have the remaining balance forgiven. Public service positions include law enforcement officers, early education teachers, public librarians, emergency medical technicians and more.

Volunteers: Many volunteer organizations offer stipends and loan forgiveness options if you provide a certain number of hours of service. For example, AmeriCorps will offer $7400 in stipends on top of $4725 to be used toward your student loans, as well as partial cancellation of your Perkins Loan in exchange for 12 months of service. The PeaceCorps and VISTA also offer similar forgiveness options.

Teachers: Under the National Defense Education Act, full-time teachers in an elementary or secondary school for low-income families may be eligible to have as much as 30% of their Perkins Loan forgiven. Contact your school district’s administration to see which schools are eligible.

Lawyers: Sorry, the ambulance-chasers on TV aren’t eligible. But many law schools will forgive the loans of students who serve as a non-profit or public interest attorney. For more information, contact the National Association for Public Interest Law at 1-202-466-3686. Or, contact your law school’s financial aid office.

Physicians: Physicians who agree to practice for a certain number of years in economically depressed areas may be able to get some of their medical school loans forgiven by the National Health Service Corps. Check with your state agency for similar programs.

There are other options for repaying your student loans, including income-based repayment, forbearance and deferment. For more information on these options, visit our student loan repayment page.

If you are not eligible for any of the aforementioned repayment options, you might consider student loan consolidation, with can turn multiple loans (federal or private) into a low, single monthly payment and possibly lower your interest rate. For more information on student loan consolidation, visit our help page.

Should I Consolidate my Private Student Loans

Federal student loan consolidation is fast, easy, free and highly recommended to lower your monthly payment. Private student loan consolidation is a bit trickier. Here are some notes to remember if you choose to go down this road.
For starters, not everyone who applies for private loan consolidation will be accepted. One only a few lenders, such as Wells Fargo and Chase, will even handle a private loan consolidation.
The aforementioned lenders and almost any bank that will consolidate your private loans will likely require a minimum amount to be consolidated.
If you can get a private student loan consolidation it may lower your monthly payments significantly, but the lifetime interest of the loan will greatly increase. It is highly recommended that once your grace period expires and you begin the process of repayment, that you aim to pay down your private loans as quickly as possible to avoid the spike in interest.

Have questions about private loan consolidation? Visit the Consolidation section of our Financial Aid Forums!

Graduating? Consider student loan consolidation.

It’s that time of the year again folks; the end of finals for the Class of [insert this year here]. If you’re part of the graduating class, you likely have your Commencement soon or have already taken the walk of glory to get your degree. Congratulations!

This post is devoted to you (yes, you!) to make sure that you start off your life as a degree holder right, with as little financial confusion or anxiety as possible. To get started, I recommend you take a second to read my blog post on exit counseling.

Once you have chosen your repayment plan, it is time to consider your current financial picture. Do you have a full-time job lined up already? If not, are you working part-time?

More than likely, you will have some sort of job when you graduate… so the question becomes one of how much can you afford in living expenses per month. Depending on the amount (and type) of loans you took out for school and the repayment plan you selected, the monthly payments may still be out of your reach by the end of your grace period.

Do I have any alternatives if I can’t afford my payments? Absolutely. A student loan consolidation can significantly reduce your monthly payments at the expense of lengthening the repayment term for your loans. For federal loans, if you selected the “extended repayment plan”, this won’t really apply to you. Where consolidation really shines is private student loans.

Depending on your credit (or with the help of a creditworthy co-signer), a private student loan consolidation can net you an excellent variable interest rate with a longer repayment plan. The result: lower monthly payments, but more interest paid overall.

Although this trade-off might leave you wondering which is the lesser of the two evils, I say with certainty (being extremely familiar with the process and how personal finance works) that it is in your best interest to be able to make your monthly payments consistently every month instead of letting any of your loans go delinquent or even drop into default. The latter will do nothing but destroy your credit and leave you in a tough situation for years.

What NOT to do when Consolidating your Student Loans

There are a great many benefits to consolidating your student loans, such as the convenience of making one or two monthly payments as opposed to six or seven, as well a lower monthly payment. But to take advantage of the perks of consolidation, there are some things not to do:

1. Consolidate federal and private together. While it’s not possible to involve your private loans in a federal loan consolidation, it is theoretically possible to involve your federal loans in a private consolidation. But that doesn’t mean you should. Such a consolidation would do away with many of the benefits of federal consolidation, including better interest rates and forgiveness options. Always consolidate your federal and private loans separately.

2. Consolidate if you are close to paying off your student loans. If you only have about a year or two worth of student loan payments, you may be better off not consolidating. In that instance, consolidation will simply spread out your federal and private loan payments with the possibility of more interest.

3. Consolidate if you are asked to pay a fee up front. Some private lenders may have consolidation fees, but not for federal. Simply contact the Department of Education’s consolidation department at 1-800-557-7392 or visit Student Loan Consolidator for all of your consolidation needs.

Confused about reform and consolidation

If you’ve heard the word about the reform currently in progress across the country, you probably are aware of the end of the FFEL program and exclusive federal consolidation returning to the Department of Education. If not, read this page on upcoming changes to get acclimated.

One question we get a lot is, “If FFEL is ending, where do we apply for consolidation now?” The answer is Direct Loan Servicing of the US Department of Education. You can apply for consolidation here: Loan Consolidation Center

Make sure to have all your account numbers and payoff balances ready to make the process quick and error-free as possible. Good luck!

Responsible Borrowing

Even with savings, gifts from family, and Scholarships and Grants you may find that you need additional funding to pay for your higher education.

Student loans can make up the difference between what you have and what you need to make your college dream a reality. Unlike scholarships and grants, however, borrowed money must be repaid - most often with interest - regardless of whether you complete your education or not.

How you manage this debt can affect your credit and your ability to borrow later on for a house, a car or anything else. Defaulting on a student loan can damage your credit for up to seven years.

Should you have trouble making your student loan payments, a Deferment will allow you to postpone payments for reasons such as unemployment or disability. A Forbearance is an agreement with your lender to postpone payments when you are having financial difficulties but are not eligible for a deferment.

For more information, see our Deferment & Loan Forbearance information. Otherwise, to combine your student loan payments into one manageable monthly payment, you may want to consider Loan Consolidation.

Borrow only what you need. Our Loan Counseling can explain the federal requirements you must meet to borrow a Stafford Loan, and help you better understand your Repayment Options. The loan counseling process includes an Entrance Interview, for when the student begins college and learns about his/her loans, and the Exit Interview, which take place upon leaving school and explains the repayment options,

Estimate the amount of debt you can afford. Use the Repayment Calculator to figure how much you'll need to make your monthly loan repayments once you graduate.

Understand your borrowing agreement fully - including all interest calculations. Our student loan glossary can help you understand all the terminology you may encounter in the financial aid process. It covers everything from accrued interest to variable interest.

Stay on schedule! Repaying a student loan on time can create and build an excellent credit history.

If you can prepay a student loan, do it! You won't incur any penalties, and you'll save on the total interest due.

Student Loan Consolidation Borrower Benefits

H.R. 2669 contains provisions aimed to increase Pell grants through 2017, gradually cut federal student loan interest rates in half over the next 5 years, and institute several cuts to lenders and guarantors. Other provisions include Title IV loan forgiveness changes, increases for income protection allowances, and Title VIII Partnership Grants.

Borrower benefits will no longer be available due to the lender and guarantor cuts:
Elimination of "Exceptional Performer" status which allowed lenders to receive higher insurance rates on defaulted loans
A reduction in the insurance paid by the federal government for defaulted loans from 98% to 97%
Reduced amount guarantors may keep when collecting on defaulted loans
Reduced special allowance payments to lenders
Increased loan fee lenders must pay to the Department of Education(DOE)
Decreased account maintenance fees paid by the DOE to guarantors

A full summary of all the provisions contained on H.R. 2669 can be reviewed by visiting: http://www.nasfaa.org/publications/2007/G2669Summary091007.html

Again, any federal student loan consolidation that has been completed prior to October 1, 2007 will not be affected by the changes.

Locate Your Student Loans

As a result of recent changes at the Department of Education, you'll need to provide your student loan information with your consolidation application. There are several ways that you can easily locate your student loans. To apply for new Student Loans, visit: Student Loan Network. National Student Loan Data System


This federal database contains a detailed list of your federal student loans, including interest rates and loan amounts. Check out our helpful guide that will assist you through each step of the process.
Get started now >>
Use Your Free Credit Report


You can get a copy of your credit report free of charge. Your report will have a detailed list of all your student loans. We have prepared a helpful tutorial that illustrates each step along the process.
Get started now >>
Monthly Loan Statements

Another option for gathering your loan information is to review your monthly student loan statements. Each statement you receive from your lender(s) will list the total amount due for your student loan(s).

Financial Aid Glossary

Department of Education – The federal agency that establishes financial aid programs and processes financial aid applications.

Academic Year – A one-year period between July 1 and June 30.

Grants – A type of financial aid award that does not have to be repaid. Grants are often made based on an applicant's financial need or EFC

Scholarships – A financial aid award that does not have to be repaid. Scholarships are generally made based on an applicant meeting certain eligibility criteria. You can search for college scholarships for free.

Loans – Financial aid awards that the student (or other party like a parent, for example) borrows from a lender, the school or other third party. Loans must be repaid by the borrower according to the terms of a promissory note, usually with interest.

Work Study – See Federal Work Study

The Free Application for Federal Student Aid (FAFSA) – The official application form for all federal financial aid programs. Complete your FAFSA online.

Federal Work Study (FWS) – Federally funded program that allows colleges and universities to create campus based employment programs for financial aid recipients.

Federal Pell Grant – A need-based financial aid program funded by the federal government. Students with an EFC less than $x are eligible for the Pell Grant. The amount of the award is based on the student's enrollment level (full time, three-quarter time, etc.) and the cost of attendance.

Federal Supplemental Education Opportunity Grant (SEOG) – A need-based financial aid program funded by the federal government. Colleges receive an annual allocation of SEOG and, within certain guidelines, develop an awarding policy for this fund.

Federal Family Education Loan Program (FFELP) – The collective name for the Federal Stafford and PLUS loan programs. FFELP loans are funded by private lenders.

Federal Direct Student Loan Program (FDSLP) – The program name for loans that are both guaranteed and funded by the federal government. If your school is a "Direct Lending School", your Stafford Loan is administered by the Federal Direct Student Loan Program (FDSLP). Funds for Federal Direct Loans are provided by the US government directly to students and their parents through their schools. Applications can be obtained from your school. Banks and guarantee agencies are not involved in the process.

Expected Family Contribution (EFC) – The amount that a student and family can be expected to contribute towards educational expenses over a year's time. The EFC is calculated when the student submits a financial aid application.

Federal Methodology Expected Family Contribution (FM EFC) – The specific EFC calculated by the federal government based on information submitted on the FAFSA. The FM EFC calculation is set each year by the U.S. Department of Education and determines eligibility for federal aid programs.

Institutional Methodology Expected Family Contribution (IM EFC) – a variation of the FM EFC calculated by a college or university. This EFC calculation can incorporate different items than the FM EFC calculation and is used by colleges to allocate institutionally sponsored aid programs.

Financial Need – The difference between a student's Cost of Attendance and Expected Family Contribution. It is the amount of financial aid the student "needs" to afford attendance at a particular college.

Cost of Attendance – the total of all costs a financial aid office estimates students will incur during attendance at the college or university

Direct Costs – Costs that the college or university directly bills to the student. Tuition and fees are direct costs.

Indirect Costs – Costs associated with a student's enrollment that are not billed by or incurred through the College. Transportation and miscellaneous costs are indirect costs.

Award Letter – A notice from a financial aid office to a financial aid applicant that specifies the financial aid programs and dollar amount of a each financial aid award.

Cost Less Aid Amount – The difference between the total cost of education and the financial aid package offered to you by the school, including scholarships, grants, work-study and Stafford Loans. This amount is what you are expected to pay out of pocket or through supplemental loan programs (see PLUS and Alternative Loans)

Federal Stafford Loan – a federally guaranteed loan program that allows students to borrow funds from lenders. Stafford Loans allow the student to defer payments while he/she is in school. The interest rate for new Stafford Loans is variable but will not exceed 8.25%.

Subsidized Stafford Loan – This is a need-based student loan. Interest that accrues on subsidized Stafford Loans while the student is in school (at least half time) is paid by the federal government on the student's behalf.

Unsubsidized Stafford Loan – The unsubsidized Stafford Loan is a non-need based loan program, so students with no financial need can even qualify for this aid program. Interest that accrues on Unsubsidized loans must be paid by the borrower, even while he/she is in school. The borrower may make periodic payments (monthly or quarterly, depending on the lender's policy) or allow the interest to accrue throughout enrollment and have the interest "capitalized" (added to the loan's principle balance). While capitalization eliminates having to make payments while in school but increases the total cost of a loan.

Federal PLUS Loan – A federally guaranteed loan program that allows parents to borrow funds to help pay educational expenses. The program does require the borrower to pass a simple credit check. The loan's interest rate is variable, but new loans have a maximum interest rate of 9%.

Promissory Note – Legal document that specifies the terms and conditions of a loan.

Deferment – A temporary period during which a borrower is not required to make payments. Deferments are more common in Federal loan programs rather than alternative loans.
For Subsidized Stafford Loan borrowers (and Perkins Loan borrowers), many deferments are subsidized, meaning the interest that accrues on the loan during the deferment is paid by the federal government.

Some deferments are unsubsidized, meaning the interest that accrues must be paid by the borrower.

(Resources on the web from the department)

Guarantee Agency (Guarantor) – One of approximately forty companies throughout the country that financially guarantee that loans made by lenders under the FFELP will be repaid. Guarantee agencies typically retain a percentage of each student loan to maintain a fund to cover unpaid loans. A list of existing guarantee agencies is available at the following link (DOE Link)

Guarantee Fee – A type of fee a borrower pays to a lender. Guarantee fees are collected as a financial reserve to protect the loan program in cases of student default. Federal Stafford, PLUS and Federal Direct Student loans guarantee fee is a maximum of 1% of the loan's principal balance.

Origination Fee – A fee the borrower pays to the lender for originating a student loan. Origination fees are most often associated with Federal Stafford, PLUS and Federal Direct Student loans. The maximum origination fee for these federal loans is 3% of the loan's principal balance.

Entrance Counseling – An educational session that first time Stafford borrowers must fulfill before the loan's proceeds can be disbursed. The Entrance Counseling sessions provides these first time borrowers basic information about student loans and the terms and conditions of the Stafford Loan program.

Exit Counseling – An educational session that Stafford Loan borrowers must fulfill around the time of graduate or separation from a college. The Exit Counseling session provides the borrower detailed information about the loans he/she borrows, the company that will collect the payment and the repayment alternatives that are available.

Debt to Income Ratio – The percentage of a loan applicant's (monthly) income that is used to meet debt obligations. Many alternative loan programs use this calculation to determine an applicant's eligibility for a loan program.

Standard Repayment – A repayment alternative in which a borrower pays a set amount monthly over the entire repayment term. Also called "Simple Repayment".

Income Sensitive Repayment – This repayment alternative is available to some federal loan borrowers (check with your lender or servicer to learn if your loans qualify for this alternative). Income sensitive repayments bases the monthly payment on the borrower's income in relation to total federal loan indebtedness.

Under this option, monthly payments can drop to as low as the amount of interest that accrues on the loan's principal balance. Borrowers must apply for this option annually and must provide documentation of income - usually in the form of a federal tax return.

Extended Repayment – A new option to recent federal loan borrowers. This option allows borrowers with high balances (greater than $25,000 in federal loans) to extend the repayment term from its standard 10 year term to 25 or 30 years.

While extending the repayment term reduces the loan's monthly payment, it also increases the total amount of interest paid on the loan.

Graduated Repayment – This option is available for federal loans, and even some alternative loan providers offer graduated repayment.

Under graduated repayment, payments are low (usually just enough to cover the loan's accruing interest) when the borrower first enters repayment. Periodically, the payments increase to pay off the loan in the standard 10 year repayment term.

The idea of graduated repayment is to have low payments while a borrower is first entering the working world. Then, as income increases, the student loan payments also increase.

Loan Servicer – Once a loan has been approved and disbursed, by the lender or the guarantee agency, it is usually transferred to a servicing company. This is a company that is responsible for managing your account while you are in school and during repayment. You will repay the servicing company until the loan is paid in full. Any questions or repayment issue should be addressed to the servicing company. However, if you are having problems with the servicer, you should contact your lender for additional assistance.

FAFSA Online - Get Financial Aid Application Help!

Do you need help with your FAFSA form? The Federal Financial Aid Application is the most important financial aid form you can complete to pay for college, but many people either avoid it or make costly mistakes when filling it out. Our free, comprehensive Help Guide, Frequently Asked Questions, and Tips and Secrets will help you maximize your financial aid and qualify for scholarships, grants, and student loans.

What financial aid application options do you have?

For more than ten years, the Student Loan Network has helped students and families like you get information and access to the funding you need for higher education. We'll help you get started with our free college scholarships program, ScholarshipPoints.com, and our free college scholarship search site, StudentScholarshipSearch.com.

After you have exhausted all resources searching for scholarships, it's time to apply for federal student loans such as the Stafford loan and PLUS loan. If federal financial aid and scholarships aren't enough, you can investigate private student loans, which are non-need based, credit-based student loans. Graduate students should also investigate graduate student loans.

Deferment and Forbearance Forms

Welcome to the Student Loan Consolidation Forms and Application Center. Here you will find the most common forms you will need in relation to loan consolidation and deferment.

Click here to obtain student loan consolidation forms!
An important fact about deferment and forbearance:

Deferment/forbearance does NOT lock in your interest rates. While your loans are deferred, they continue to have variable rates unless you are deferring a consolidated loan (which has a fixed interest rate). Currently, interest rates are at 39 year lows; if you consolidate now, you can defer after the consolidation is done and have these rates locked in for the life of the loan, and still defer payments for up to 3 years or 36 months. If rates go up and you do not consolidate, your deferred loans will accrue interest at the higher rates.

Click here to consolidate your student loans before deferment! Form Requirements

In School Deferment Enrolled at an eligible school as a full-time student
Enrolled at an eligible school less than full-time but at least half-time (for borrowers who, on the date they signed the promissory note, did not have an outstanding balance on an FFEL Program loan made before July 1, 1987)

Economic hardship deferment Experiencing financial hardship. Borrower is receiving payments under federal or state public assistance; or serving as a Peace Corp volunteer; or borrower is working full-time and monthly income does not meet certain standards; or borrower's payments on all of the borrower's federal education loans exceed a certain percentage of income.

Unemployment deferment Borrower is eligible for unemployment benefits
Borrower is unemployed or working less than 30 hours and diligently seeking full-time employment

Temporary disability deferment Borrower is temporarily totally disabled
Borrower is unable to maintain employment because of caring for a spouse or dependent who is temporarily totally disabled

Education related Deferment Engaged in a full-time course of study in a Graduate Fellowship program
Engaged in a full-time Rehabilitation Training program
Engaged in an Internship/Residency program (for borrowers with an outstanding balance on at least one FFEL program loan that was made before July 1, 1993; PLUS loan borrowers qualify only if the loan was made before August 15, 1993)
Teaching in a designated teacher shortage area (for Stafford or SLS borrowers whose first loans were made on or after July 1, 1987 and before July 1, 1993)

Working parent / parental leave deferment Borrower is pregnant, caring for a newborn child or caring for a newly adopted child and is not working full-time or attending school during the deferment period and was enrolled in school at least half-time within the six-month period preceding this deferment
Borrower entered or reentered the workforce within one year preceding this deferment and is working full-time in a position earning not more than $1 per hour above the federal minimum wage and is the mother of a preschool-age child
(for borrowers with an outstanding balance on at least one FFEL Program loan which was made before July 1, 1993, or borrower had a balance on a loan that was made before July 1, 1993, at the time borrower obtained any loan disbursed on or after July 1, 1993. Parental Leave/Working Mother Deferment)

PLUS Borrower with dependent student Dependent student is enrolled full-time at an eligible school (for PLUS borrowers with an outstanding balance on an FFEL Program loan which was made on or after July 1, 1987, and before July 1, 1993, or the PLUS borrower must have an outstanding balance on a FFEL Program loan made before July 1, 1993, when borrower obtained a loan disbursed on or after July 1, 1993)
Dependent student is engaged full-time in a rehabilitation training program (for PLUS borrowers with an outstanding balance on a FFEL Program loan which was made before July 1, 1993, or for borrowers with an with an outstanding balance on a FFEL Program loan made before July 1, 1993, when borrower obtained a loan disbursed on or after July 1,1993)

Public service deferment Borrower is on active duty in the Armed Forces of the United States
Borrower is serving full-time as an officer in the Commissioned Corps of the Public Health Service
Borrower is serving in the Peace Corp
Borrower is a full-time paid volunteer in the Action Programs
Borrower is a full-time paid volunteer for a Tax-Exempt Organization
Borrower is on active duty in the National Oceanic and Atmospheric Administration (NOAA)
PLUS borrowers or Consolidation borrowers are not eligible for a Public Service Deferment

Personal Finance First-Aid Kit

Does Your Budget Need First-Aid?


Getting established after graduation is no easy task. Between looking for a job, finding a place to live and paying for living expenses, life can be expensive. At Student Loan Consolidator, we know how important this period of life is, so we developed the Personal Finance First-Aid Kit – a self guided easy to use budget tool.
How The First-Aid Kit Can Help

For starters, the First-Aid Kit provides a monthly budget worksheet with simple instructions on how to draw up a budget. It only takes a few minutes, and can really give you a sense of where your money is being spent.

Next we list tips on how to cut corners and save money in all areas of your budget. From negotiating better rates with credit card companies, to finding discounts on gas and air travel, there are hundreds of ways to save extra money each month.

Finally, we'll send you monthly updates with new ideas on how to save extra cash and optimize your budget.

Private Student Loan Consolidation FAQs

A private consolidation loan can help you effectively manage your monthly payments following graduation. By lowering your monthly private student loan payments, you can afford the other expenses associated with starting a career and life after college.
Is a co-signer required?

If you are an undergraduate or recent graduate, yes, a co-signer will likely be required by your lender. This is entirely based on credit history and if the lender has any specific internal requirements for processing consolidation loans; some only look at credit, others want the assurance of a borrower having a cosigner. However, borrowers with strong, established credit can consolidate their loans (both undergraduate and graduate loans) without a co-signer. We recommend that both undergraduate and graduate degree holders apply with a qualified co-signer, as it will greatly increase their chance for approval and could provide a lower interest rate.
Which types of loans are eligible to be consolidated?

Most lenders will accept private student loans disbursed to any nationally-accredited school. Check with your lender for any special internal criteria.
What information will I typically need to complete a consolidation application form?

You will need to have the following information available for you and your co-signer (if applicable):
Name, address and social security number
Names, addresses and telephone numbers of two personal references
Monthly Income and expense information
For Each of the loans to be consolidated:
Loan Account Number
Name, address and telephone number of each loan servicer (on your monthly billing statement)
Outstanding loan balance/expected payoff amount
Get Started Now
How long will it take for my loan to be consolidated?

Generally speaking, you should expect the entire private loan consolidation process to be completed in less than 45 days. This is of course dependent upon your ability to provide the required documentation regarding your income, expenses and underlying private student loans. If the application load of your lender is severe, the process may take longer.
Where do I find out how much I owe on my current private student loans?

By reviewing your most recent monthly statement from the student loans servicer(s) who are currently handling your loan(s). In addition, your servicer is likely to provide on-line access to your account balances. Please check your monthly statements online.
Is there a minimum loan amount?

Yes, most lenders require a combined minimum balance of around $5,000 or higher on all involved loans for consolidation.
Is there a maximum loan amount?

Yes, this figure depends on the policies of your lender. Check the website of your consolidation lender or contact them by phone for more details.
Does my school need to be involved?

No, school participation is not required.

If you are still in school, we would caution you to wait until after graduation or when your current deferment has ended. Of course, if you're in a position to make payments in advance of those two events, we would urge you to begin the process now to simplify repayment and pay down your student loans early.
Do I have to keep making payments on my existing loans while I'm consolidating?

Yes, we recommend that while in the process of applying for the consolidation loan that you continue making your on-time monthly payments. This will assure that your credit remains in good standing.

Private Student Loan Consolidation Rates

Private student loan consolidation interest rates are based on either the LIBOR or Prime index, plus a margin for borrower / cosigner credit. The only way to determine what the interest rate on your private consolidation loan will be is to contact your lender.

Origination fees range between 0% and 8% depending upon your individual credit or the credit of a co-signer. In some cases fees are due at loan closing and are capitalized (added to the loan), which increases the amount borrowed but avoids any out-of-pocket expenses at loan closing.

View interest rate information for graduate private loan consolidation.
Undergraduate Private Consolidation Program Description:Rates LIBOR + 5% - 8.5%
APR1 7.90% - 11.93%
Fees2 1% - 5%
Max Term 25 years
Max Balance $150,000

Based upon a $45,000 principal balance, a 300 month term and a LIBOR rate of 2.8% (as of 7/22/08); the Annual Percentage Rate (APR) would be 7.9% for a borrower with excellent credit who received a rate of LIBOR plus 5% and was assessed a fee of 1% of the loan amount.
Get Started Now

View interest rate example for graduate private loan consolidation.
Benefits of Private Student Loan Consolidation:
Lower Monthly Payments: Most borrowers can reduce their monthly payment by extending the repayment term of their private student loan debt.
Conditional pre-approval decision within minutes online or by phone.
Reduced Interest Rates: Borrowers with improved credit may often lower their interest rate. Existing loan holders will not reduce your interest rate if your credit has improved.
Rate Reductions: Borrowers may apply on their own or with a credit-worthy co-signer. Borrower and Co-signers with superior credit may receive lower APR loans.
Internship/Residency & Military Deferment: A 48 month deferment for medical/dental residents and a 36 month deferment for all active-duty military personnel.
Up to 25 Year Repayment Term: Borrowers may receive up to a 25 year repayment term which offers the lowest possible monthly payment.
No Prepayment Penalties: All payments in excess of scheduled payments go directly to principal.

Private Student Loan Consolidation

Private student loan consolidation is a great way to significantly lower your monthly loan payments by combining all your private student loans into one manageable loan. Refinancing your private student loans will reduce the stress of multiple payments and allow you to budget more effectively while lowering your interest rate.
Get Started Now

Here's a chart showing your savings with private student loan consolidation: Loan Amount Assumed Current Payment* Initial Monthly Payment** Monthly Savings Annual Savings
$10,000.00 $88.77 $69.41 $19.36 $232.32
$30,000.00 $269.00 $208.22 $60.78 $729.36
$50,000.00 $448.33 $347.20 $101.13 $1,213.51
$75,000.00 $672.49 $520.55 $151.94 $1,823.28
$100,000.00 $896.65 $694.07 $202.58 $2,430.96


*Assuming a 15 year loan term, with an original rate of 6.8%
**Assuming extended term of 25 years at same rate of 6.8%
***Interest rate and the resulting monthly payment(s) contingent upon borrower and/or co-signer credit
Note: Visit our Private Student Loan Interest Rates page for additional details.

View an example of Graduate Private Student Loan Consolidation

Non-Student Loan Debt Consolidation

Do you have more debt outside of student loans? Please request a free debt consultation today. Consolidate your debt into one lower payment, avoid bankruptcy, and be debt free in as little as 12-48 months. Get Started Now!
Other Benefits of Private Student Loan Consolidation:
Lower Monthly Payments: With private student loan consolidation, most borrowers can reduce their monthly payment by extending the repayment term of their private student loan debt.
Reduced Interest Rates: Borrowers with improved credit may often lower their interest rate. Existing loan holders will not reduce your interest rate if your credit has improved.
Rate Reductions: Borrowers may apply on their own or with a credit-worthy co-signer for private student loan consolidation. Borrower and Co-signers with superior credit may receive lower APR loans.
Internship/Residency & Military Deferment: A 48 month deferment for medical/dental residents and a 36 month deferment for all active-duty military personnel.
Repayment Term: Undergraduate borrowers may receive up to a 25 year repayment term which offers the lowest possible monthly payment, and graduate student borrowers may receive up to a 30 year repayment term.
No Prepayment Penalties: All payments in excess of scheduled payments go directly to principal.

Federal Student Loan Consolidation FAQ

Federal school Loan Consolidation is a great tool that allows borrowers to merge all of their federal loans into one new loan.
What are the benefits of federal consolidation loans?
Potentially reduce your monthly payment
Simplified finances - you make only one payment each month
Provides budget friendly repayment options
Saves you money today when you need it most

Student loan consolidation allows borrowers (parents or students) to lock in today's low rates and to combine several federal student loans into one loan, simplifying repayment. Because repayment can be spread over a longer time period, your monthly payment amount will be lower.
What about non-student loan debt, can that be consolidated?

For any other debt you may have, including credit cards and personal loan debt, debt consultation services exist to help making debt repayment easier and more affordable. You can reduce your debt up to 50% and become debt free in as little as 12-48 months. Find out more about debt consultation.

Free Non-Student Loan Debt Consultation

Do you have more debt outside of student loans? Please request a free debt consultation today. Consolidate your debt into one lower payment, avoid bankruptcy, and be debt free in as little as 12-48 months. Get Started Now!

Who is eligible for student loan consolidation?

To be eligible for federal student loan consolidation, borrowers must:
Not be in default
Not be in school more than half time for the loans being consolidation

Here are the things that are not required:
You do not need to be employed to consolidate your loans.
You do not need to have any form of collateral.
You do not need a cosigner of any kind.
Apply Now for Federal Student Loan Consolidation
What is the interest rate?

The rate will be a fixed rate equal to a weighted average of the interest rates on your existing loans rounded up to the nearest one-eighth of one percent.

Federal Consolidation interest rates are based on the weighted average of student loan interest rates. Federal student loans disbursed on or after July 1, 2006 have an interest rate of 6.8%. Federal Parent Plus loans disbursed after July 1, 2006 have an interest rate of 8.5%. Federal student loans disbursed before July 1, 2006 will remain variable interest rate loans. These loans will re-adjust every July 1 based on the results of the 91-day Treasury Bill. Currently, interest rates for these variable loans are:
Stafford Loans in grace: 1.88%
Stafford Loans in repayment: 2.48%
PLUS Loans: 3.48%
Perkins Loans: 5%
HEAL Loans: 4.125%
Previous consolidations: existing consolidation rate
Click here for updated information about consolidation loan interest rates.

Take a look at our Loan Calculator to help you figure out your new rate and monthly payment.

Please note that we cannot guarantee any interest rate due to the time it takes to process an application. We can only provide rough estimates; you should not rely on these estimates for financial planning! Why? Because consolidation takes between 30 - 60 days, and in that time period, you may be making payments, or your loan status may change. Because your interest rate is determined not only on the type of loan you have, but also on how much you owe, we can make no guarantee except to say that your interest rates will never exceed federally specified, published rates.
Apply Now for Federal Student Loan Consolidation
What types of loans may be consolidated?
Stafford Loans - Subsidized and Unsubsidized
Federal Direct Stafford Loans - Subsidized and Unsubsidized
HEAL/HPSL Student Loans
Parent PLUS Loans
Federal Direct Parent PLUS Loans
Federal Consolidation Loans*
Federal Direct Consolidation Loans*
Perkins Loans
Nursing School Loans and more...

* Federal and direct consolidation loans cannot be reconsolidated unless additional loans are included. For example, if you consolidated your federal loans after your undergraduate degree and then wanted to also consolidate your graduate loans, you can combine the new loans with those that were reconsolidated.

Click here for private student loan consolidation.
What about private loan consolidation?

It's not a bad idea to consolidate your private student loans. What is a bad idea is combining federal and private student loans, which results in a consolidated private loan. This is bad for many reasons:
You cannot defer payments on a private loan consolidation if you want to go back to school. You can with federal loan consolidation.
You cannot forbear payments in case of economic hardship on a private loan consolidation.
You cannot claim interest as a tax deduction on a private loan consolidation.
You cannot apply for forgiveness on a private loan consolidation. Certain types of work, such as federal volunteer programs, teaching in economic development zones, and military service, among others, can qualify you to have part or all of your federal loans dismissed by the government.
If you should pass away, private loans are passed to your next of kin. Federal loans are forgiven.
Private loan consolidation very often has variable rates, which means you cannot lock in today's current historic low rates. Those rates may be tied to volatile indexes like the Prime Rate, which can jump as high as 13%.
Apply Now for Federal Student Loan Consolidation
What about credit card consolidation, car loans, etc.?

Unfortunately, you cannot combine non-federal loans of any kind with federal student loans. Why? Because they are different types of loans. Federal student loans are backed by the US Government; if a student doesn't pay their loans, the government pays the lender, and then obtains payment from the student. The lending institutions (typically banks) know that they will always get their money back, which is why they can offer student loans at such low rates compared to other kinds of loans.

Private loans, such as credit cards, car loans, mortgages, etc. are backed by an individual's creditworthiness and collateral. Lending institutions take higher risks in loaning money privately than through the government. The government and the banks will not permit low-risk loans to be combined with high risk loans, and so you cannot consolidate other forms of debt with your federal student loans.

However, consolidate student loans to improve your credit, and you may be able to qualify for better interest rates on your private loans when you refinance them.
What about consolidating with my spouse?

Spousal consolidation is no longer permitted. Sorry.
I consolidated in the past, can I do it again?

It depends. Consolidation is the combination of many loans into one. If you have consolidated in the past with someone other than the US Department of Education, you can't do it again unless:
You have new student loans that were not included in the original consolidation.
Or, you have multiple consolidations from different lenders.
How is the consolidation loan repaid?

The first payment is due no more than 30 days from the date the Consolidation loan is disbursed. Repayment schedule choices include:
Standard payments (fixed monthly payments over a fixed time)
Graduated payments (payments which gradually increase over the years)
Income-Sensitive payments (variable payment amounts based upon annual income) and
Extended payments (more than $30,000 over a 25 year period or more than $60,000 over a 30 year period).
Is there a credit check required to consolidate?

No, there is no credit check, because your federal student loans are guaranteed by the US Government.
Apply Now for Federal Student Loan Consolidation
Are there any early payment/repayment fees or penalties?

No, there are no early repayment penalties for a student loan consolidation. The government wants their money back. To make extra payments, consolidate now, and then when your payment schedule begins, simply specify "Extra payment to principal" on your early payments.

Did you know that early repayments are interest-free? It's true! Every dollar beyond your required monthly payment is paid towards the principal - it's like an interest-free payment!
Do I continue making loan payments while my consolidation application is in process?

Yes! Until you are notified that your loans have been paid off through the consolidation process, you should continue to make your student loan repayments. Since consolidation can take anywhere from 30 - 90 days, it's important that you don't fall behind on payments.
How long does student loan consolidation take?

Consolidation can take anywhere from 30 to 90 days; in rare cases it may take longer. The process to retrieve payoff statements (called LVCs - Loan Verification Certificates) from your lenders takes the longest amount of time.
What do I do if I am not eligible to consolidate?

If you've previously consolidated, have loans with just one lender, loans totaling less than $20,000, or other conditions which prohibit you from consolidating your federal student loans with us, there are a few options you can pursue:
Consider a private loan consolidation.
Consider a personal line of credit from your bank or credit union.
Visit our Student Credit and Debt Help information center.
Apply Now for Federal Student Loan Consolidation
Can I defer or forbear?

Yes! One of the greatest benefits of federal student loan consolidation is that you retain all your federal borrowing privileges, such as:
Deferment of your consolidation payments when you return to school
Forbearance of your consolidation for up to 36 months
Forgiveness of your entire loan if you pass away

How do you defer? Once you consolidate, you will receive paperwork for your payment schedule. At that time, you can request a deferment or forbearance form.

To get forms, click here!
Why do student loan rates change?

See our page on the relationship between student loans and Treasury bills!
Why Consolidate my Student Loans?

The very best time to consolidate your student loans is immediately after graduating, before your grace period ends. Doing so allows you to lock in the lowest possible interest rate on your loans.

Consolidating is a great option whenever you want to increase your monthly cash flow - by consolidating, you extend your repayment term and get additional discounts on your existing rates, which reduces the monthly payment you make.
Repayment Guidelines

Depending on the total amount of your consolidation loan, the government has set the following repayment periods:

Student Loan Consolidation Interest Rates

The interest rates for federal student loan consolidations are based on the weighted average of student loan interest rates. All Federal Stafford loans disbursed between July 1, 2006 and June 30, 2008 have an interest rate of 6.8%*. Subsidized Stafford loans disbursed between July 1, 2008 and July 1, 2009 have a rate of 6.0%, and Subsidized Stafford loans disbursed after July 1, 2009 have a rate of 5.6%. Currently, Unsubsidized Stafford loans remain at 6.8%.

Federal student loans will have different rates depending on type and disbursement dates. For example, rates for Stafford loan disbursed before July 1, 2006 will remain variable until consolidated.

* Currently, the interest rates for Federal loans disbursed before July 1, 2006 are at an all time low:
Stafford Loan (in school/grace period): 1.88%
Stafford Loan (in repayment): 2.48%
Federal PLUS loan: 3.28%

Apply Now for Federal Student Loan Consolidation


If you still have Federal loans at a variable interest rate now is the time to consolidate. When you consolidate Federal loans the interest rate is the weighted average of all your loans rounded up to the nearest 1/8 percent. This would result in final consolidation interest rates of:
Stafford Loan (in school/grace period): 2.0%
Stafford Loan (in repayment): 2.50%
Federal PLUS loan: 3.38%
Private Student Loan Consolidation Rates

Private student loan consolidation interest rates are variable, based on either the LIBOR (London Interbank Offered Rate) or the Prime rate, plus a margin for borrower and/or co-signer credit.

Origination fees can range between 1% and 5% depending upon your individual credit or the credit of a co-signer. Any fees that associated with the loan are capitalized (added to the loan) typically at the time repayment begins, which increases the amount borrowed but avoids any out-of-pocket expenses at loan closing.

Student Loan Consolidation Benefits

How big is your monthly payment?


Let's face it, life after graduation can get very expensive. With all the living expenses tied into post grad life, including housing costs, car payments, and relocation, why worry about a huge school loan payment? Student loan consolidation can reduce your monthly payment, and help you manage your budget.
Take advantage of these benefits:
Reduce your monthly payment
No penalties for early repayment
Simplify your monthly bill-paying paperwork with one payment a month
No credit check, no co-signers needed, and no fees
Consolidation loan interest is Federal Income Tax Deductible
Apply Now for Federal Student Loan Consolidation

Use our student loan consolidation calculator and find your student loan savings!

How Student Loan Consolidation Works

The following step-by-step guide will help you understand how consolidation works and how it will benefit you for years to come.
Step 1: Apply for Consolidation

The first step in consolidating your student loans is applying for a consolidation loan.
Step 2: Locate Your Student Loans

As a result of recent changes at the Department of Education, you'll need to provide your student loan information with your consolidation application. There are several ways that you can locate your student loans and the easiest is to contact the Borrower Tracking office of the Department of Education at (800) 433-3243.
Step 3: Sign and Mail

Once you have reviewed the promissory note, and understand the terms, you will sign and return the application. Either by eSignature online, or by sending the paper application back to the lender you choose to consolidate with.
Apply Now for Federal Student Loan Consolidation

Step 4: Application Processing

After your application is submitted for processing, the "loan retrieval" begins. The consolidating lender will contact your lenders for the exact amount you owe; this information is sent to them on a loan verification certificate, or LVC. This process can take up to 60 days depending on the response time from your lender(s).

Once the check is sent to your lender(s), your loans have officially been consolidated. You will receive a new statement from us detailing when your first payment is due, and when each payment is due thereafter. Your previous lenders can take a week or two to close out your accounts, so do not be alarmed if you get a statement from us, and a statement from your old lender. This is normal.

Your first billing statement from us will include the automatic checking account withdrawal enrollment form. It will also include information on any other discounts you are eligible for. Your previous Stafford loans are paid in full.

Student Loan Consolidation Calculator

Consolidating federal student loans can significantly decrease your monthly loan payment. Use the simple consolidation calculator below to estimate your monthly savings.

You can use estimates for the loan amounts, and you can combine loans with the same or similar interest rates. If you are not sure of your rates, this interest rate chart may help. Enter Loan Amounts:
enter whole number (example 15000) Interest Rates:
enter as a decimal (example: 6.62)
Loan 1: $ .00 %
Loan 2: $ .00 %
Loan 3: $ .00 %
Loan 4: $ .00 %
Loan 5: $ .00 %


Not sure what your rates are? Interest Rate
Stafford Loans in grace period issued before July 1, 2006 1.88%
Stafford Loans in repayment issued before July 1, 2006 2.48%
Stafford Loans issued after July 1, 2006 but before July 1, 2008 6.8%
Subsidized Stafford Loans issued after July 1, 2008 but before July 1, 2009 6.0%
Unsubsidized Stafford Loans issued after July 1, 2008 6.8%
Parent PLUS Loans issued before July 1, 2006 3.48%
Parent PLUS Loans issued after July 1, 2008 8.5%


Previous consolidations have fixed rates set at time of consolidation.
Apply Now for Federal Student Loan Consolidation

Federal Student Loan Consolidation

Federal student loan consolidation is a fixed-rate refinancing program that combines all of your existing federal student loans into one new loan. Consolidation is a great tool for managing your finances - providing immediate payment relief and long term benefits.
Cut your monthly student loan payment
Simplify your finances with one monthly payment
No credit checks, fees, or application charges
Reduce your interest rate 0.6% by consolidating during your grace period
Free Non-Student Loan Debt Consultation

Do you have more debt outside of student loans? Please request a free debt consultation today. Consolidate your debt into one lower payment, avoid bankruptcy, and be debt free in as little as 12-48 months. Get Started Now!
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Federal Student Loan Consolidation Payment Relief

One of the key benefits of consolidating your federal school loans is payment relief. By combining all of your student loans into one consolidated loan, you can lengthen your repayment term from the standard 10 years to up to 30 years, depending on the amount of your education debts. With a lower monthly payment, you'll have more money available to meet other living expenses, including car payments, housing expenses, and career-related necessities. Because there are no penalties for overpayment, you can make larger payments and reduce your repayment term when it becomes affordable. Learn more about how student loan consolidation works in this step-by-step tutorial.
What Qualifies for Federal Student Loan Consolidation?

Federal loan consolidation can include Federal Stafford Loan consolidation, PLUS Loan consolidation, Direct Loan consolidation as well as Perkins Loans, HEAL Loans and all Federal FFELP and Direct Loans taken to pay for your education. Private student loan consolidation is different - You will lose your federal loan benefits if you consolidate your federal loans into a private loan consolidation.
Managing Existing Student Loan Debt Obligations:
If you're having trouble meeting your student loan payments, contact your loan servicer. You may qualify for a deferment, forbearance, or repayment alternative that is more affordable.
Consolidation can help by extending your loan's repayment term beyond the standard ten years. While this will increase the total interest charges, the monthly payments will become more manageable.
Watch your expenses! Just as you need to be cautious when you're in school, you need to be aware of your expenses after you leave school.
Limit credit card usage to absolute necessities. Remember you'll pay more for every charged item because of the credit card's finance charges.
If you must have student credit cards, shop around for low interest rates or call existing credit card providers and ask them for a lower rate.
If you are delinquent or in default, visit our Student Loan Default Assistance page for more help.