LOAN CONSOLIDATION

WHAT IS LOAN CONSOLIDATION?

• A Direct Consolidation Loan allows you to consolidate (combine) multiple federal education loans into one loan. The result is a single monthly payment instead of multiple payments.

SHOULD I CONSOLIDATE?

• Carefully consider whether loan consolidation is the best option for you. Loan consolidation can greatly simplify loan repayment by centralizing your loans to one bill and can lower monthly payments by giving you up to 30 years to repay your loans.
• However, if you increase the length of your repayment period, you'll also make more payments and pay more in interest. Be sure to compare your current monthly payments to what monthly payments would be if you consolidated your loans.

WHAT LOANS CAN BE CONSOLIDATED?

• Direct Subsidized Loans Direct Unsubsidized Loans Subsidized Federal Stafford Loans Unsubsidized Federal Stafford Loans Direct PLUS Loans PLUS loans from the Federal Family Education Loan (FFEL) Program Supplemental Loans for Students (SLS) Federal Perkins Loans Federal Nursing Loans Health Education Assistance Loans some existing consolidation loans
• As well as any other federal loan

INTEREST RATES?

• A Direct Consolidation Loan has a fixed interest rate for the life of the loan. The fixed rate is based on the weighted average of the interest rates on the loans being consolidated, rounded up to the nearest one-eighth of 1%. There is no cap on the interest rate of a Direct Consolidation Loan.

WHEN DO I REPAY?

• Repayment of a Direct Consolidation Loan can begin 60 days after the loan is disbursed, or sooner. Your loan servicer will let you know when the first payment is due. The repayment term ranges from 10 to 30 years, depending on the amount of your consolidation loan, your other education loan debt, and the repayment plan you select.

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• There are several repayment plans that are designed to meet the different needs of individual borrowers. You will receive more detailed information on your repayment options from your consolidation servicer when you consolidate your loan.