In some cases, you may be required to consolidate your loans into Direct Consolidation Loans in order to be eligible for loan forgiveness.
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What types of loans are not eligible for PSLF (do need to be consolidated)?
- Federal Family Education Loans (FFEL), Direct Parent PLUS Loans and Perkins Loans are not eligible to be forgiven under the PSLF program. Consolidating converts your ineligible loan types to the eligible type.
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What types of loans are eligible for PSLF (do not need to be consolidated)?
- The only loan types eligible for the Public Service Loan Forgiveness program are Direct Unsubsidized/Subsidized Loans, Direct Consolidation Loans and Direct Graduate PLUS Loans.
- You do not want to consolidate any eligible loans you already have (Direct Loans other than Direct Parent PLUS Loans). This is because under the PSLF program, you must make 10 years of payments on an Income Driven Repayment plan. Any previous qualifying forgiveness payments start over if your loans require consolidation which means you would need to pay an additional 10 years after consolidation. If you have Direct Loan that already qualify, consolidation could reset the progress on these loans.
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Where do I consolidate my loans?
- Student loan consolidation must be consolidated through the Federal Student Aid website
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Will consolidating refinance my loans?
- Consolidating your loans will not refinance them
- Consolidation for the purpose of eligibility does not change the balance of the loans and in most cases, will not change the interest rate either. For more information on consolidation and interest rates: https://bysavi.zendesk.com/hc/en-us/articles/115005093994-Will-my-interest-rate-remain-the-same-after-consolidating-my-federal-loans
- For Step by Step detailed instructions on how to consolidate: https://bysavi.zendesk.com/hc/en-us/articles/31885922368147-How-to-complete-a-paper-consolidation-application