Joint Consolidation Loans, also known as Spousal Consolidation Loans, allowed two married federal student loan borrowers to get one consolidation loan. The U.S. Department of Education no longer offers these loan types, but they did from 1993 to 2006.
Through a consolidation loan, your old loans were paid off and you were left with one loan and one monthly payment. This can help streamline the repayment process. Instead of separate monthly payments, you have one joint consolidation loan.
A few things to keep in mind if you have one of these loans:
- Joint FFEL Consolidation Loans cannot be re-consolidated into a Direct Consolidation Loan. Unfortunately, if you have a Joint FFEL Consolidation Loan, it is not currently possible to make that loan eligible for Public Service Loan Forgiveness (PSLF) because only Direct loans are eligible for that program. You can read more about this here.
- If you have a Joint Direct Consolidation Loan, it is eligible for PSLF, but there’s a few things to keep in mind:
- Both you and your spouse must have been employed full-time by a qualifying employer at the time each of the 120 payments were made to receive full forgiveness of the loan.
- If only one of you met the employment requirement, only the portion of the remaining balance attributable to the original loans of that individual would be forgiven. For example, if you were employed full-time by a qualifying employer when each of the required 120 payments was made, but your spouse never worked for a qualifying employer or worked for a qualifying employer only when some of the payments were made, the amount forgiven after the 120th qualifying payment would be the remaining balance of the loan attributable to the loans you originally received that were paid off by the joint consolidation loan. Both you and your spouse would remain responsible for repaying the remaining balance of the loan that is attributable to the loans your spouse originally received.
- You can’t receive forgiveness of a joint Direct Consolidation Loan by combining payments made when only you met the employment requirement with payments made while only your spouse met the employment requirement. For example, if only you were working for a qualifying employer when 80 payments were made and only your spouse was working for a qualifying employer when 40 payments were made, the payments cannot be combined to count as 120 qualifying payments that would make the loan eligible for PSLF. This same information can be found here.
As for separating the loans, Savi has not come across any information to suggest this is possible, but there are still steps you can take to attempt it. Our recommendation for you moving forward is to do the following:
- Call your loan servicer, and ask them if it's possible to separate the previous Joint Consolidation.
- Submit the recommended form to the parties that they instruct you to. Either you - or both you and your spouse - will have to fill this out.
- Your Loan Servicer should be in the best position to help with this. However, if they are not, you can try calling the Department of Education Support Center. Their number is 800-557-7394.