Consolidating stafford and perkins loans
With PSLF, you need to make 120 qualifying payments on the loan before you receive forgiveness.
If you consolidate your loans, the qualifying payments you made don’t transfer to the new loan. If you have these loans and consolidate, you’ll no longer qualify for loan cancellation under that program.
Plus, if you are eligible for Public Service Loan Forgiveness (PSLF), which provides tax-free forgiveness after 120 qualifying payments, it’s to your benefit to consolidate so that you’re eligible for income-driven plans.
Even if you’re not eligible for PSLF, the regular forgiveness options under IDR plans shouldn’t be ignored.
Direct Loan Consolidation can help simplify your student loan repayment strategy and may even lower your monthly payments.
These loans include: If you have these types of loans and are struggling to make your payments, you may want to consolidate your student loans in order to qualify.
Income-Driven Repayment (IDR) plans can not only potentially lower your monthly payments, but they also qualify you for forgiveness of the remaining balance at the end of the repayment term.
Depending on your situation, using a Direct Consolidation Loan could be a great strategy to help pay down your debts more quickly: If tracking all your student loan payments is driving you crazy, Direct Loan Consolidation may inject a well-needed dose of sanity into your life and budget.
Check the federal student aid website for a list of the types of loans that qualify.