Consolidation is the process of combining multiple loans into a single loan. While borrowers can technically consolidate multiple loans into a single private loan by refinancing, the term “consolidation” in the context of student loans is almost always used to refer to consolidating multiple federal loans into a single Direct Consolidation Loan. Unlike refinancing, getting a new Direct Consolidation Loan may actually increase a borrower’s interest rate, as the new interest rate will be the average weighted interest of composite loans rounded up to the nearest 1/8 percent.


  • Indicate which loans you would like to consolidate.
  • NOTE: Loans made to students cannot be consolidated with loans made to parents. Therefore, our algorithm will automatically create two Consolidation Loans if loans made to students and parents are checked.


  • Virtually all federal loans, although loans made to parents cannot be consolidated with loans made to students (and vice-versa).
  • Loans must be in grace period or in repayment, and the borrower must have graduated, left school, or be below half-time enrollment.


  • Easier to manage one loan vs. multiple
  • Potential access to additional loan forgiveness programs
  • Potential access to additional repayment plans
  • Potential access to more favorable repayment terms
  • Can help bring loans out of default


  • May forfeit certain benefits associated with existing loans
  • The overall interest rate may go up
  • Qualifying payments for Public Service Loan Forgiveness is reset

Best For

  • Borrowers on older loan programs (e.g. FFEL) who want access to the repayment options and loan forgiveness programs of Direct loans