At Student Loan Movement, our goal is to help educate individuals about all repayment options available that loan servicers do not inform them of.
What are the benefits of consolidating my loan? Back to Top
Consolidating student loans will put all your existing loans into the Federal Direct Loan Program with the Department of Education. You will only have to worry about one payment instead of multiple payments. This makes it easier to manage your debt. Further, within this program, there are options that can help make payments more affordable to certain borrowers and may forgive some portion of the loan balance at the end of the loan term.
Will my payment be reduced? Back to Top
In many cases yes, your payment in the new consolidated loan can be lower than your current payment. There are multiple plans to repay your student loan, one of which is the Income Based Repayment Plan. This allows your payment to be based on your annual income, which often times will allow you to qualify for a very small payment and in some cases even a payment amount of $0.
Is there a minimum or maximum loan amount that qualify? Back to Top
What is Student Loan Forgiveness? Back to Top
If you qualify for and enroll into either the Income Contingent Repayment (ICR), Income Based Repayment (IBR), or Pay As You Earn (PAYE or REPAY) repayment plans, your loan balance could be forgiven at the end of the term if you still have a remaining balance. The term of the loan would be between 20-25 years depending on which repayment plan you choose, and when your loans were originally borrowed. The amount that can be forgiven will determine on your original loan amount, how much you are earning, and how much your earnings fluctuate during your repayment term.
What is the Public Service Loan Forgiveness Program? Back to Top
In 2007, Congress created the Public Service Loan Forgiveness Program to encourage individuals to enter and continue to work full-time in public service jobs. Under this program, borrowers may qualify for forgiveness of the remaining balance due on their eligible federal student loans after they have made 120 payments on those loans under certain repayment plans while employed full time by certain public service employers.
Can I defer my payments? Back to Top
Possibly; once you are consolidated into a qualifying Direct Consolidation Loan you may qualify to renew your deferment options.
Will I retain my subsidy benefits? Back to Top
Borrowers will be able to retain their benefits on subsidized loans when consolidated into the subsidized portion of a consolidation loan.
Am I eligible for a Direct Consolidation Loan? Back to Top
Borrowers must have at least one Direct Loan or Federal Family Education Loan (FFEL) that is in grace, repayment, deferment, or default status to qualify. Loans that are in-school status cannot be included in the Federal Loan Forgiveness Program.If you are in default, you can consolidate under the Income Contingent Repayment Play or Income Based Repayment Plan.If you have already consolidated but have one loan which is not, you can add that one loan into the consolidation.
Is Student Loan Movement part of the US Department of Education? Back to Top
No. Student Loan Movement is not affiliated with the Department of Education or any governmental entity. Student Loan Movement is a private advocacy organization that specializes in document preparation services that will streamline your enrollment into a qualified Direct Consolidation Loan program.
Can consolidate my loans or apply for government programs myself? Back to Top
Yes. You can certainly contact the Department of Education and see what programs you qualify for and apply. We find that many consumers prefer to work with our organization and utilize our expertise and assistance as our streamlined process ensures their Direct Consolidation is approved and our one-on-one consultations assure a full understanding of all program options and benefits.
Can my PLUS Loan be consolidated? Back to Top
Yes, PLUS loans can be consolidated.
Can I consolidate my Perkins Loan? Back to Top
Yes you can consolidate your Perkins Loan into the Direct Consolidation Loan if you include at least one Direct Loan or Federal Family Educational Loan (FFEL). Perkins Loan cannot be included by themselves. There are some disadvantages to consolidating your Perkins Loan so you should consider them prior to consolidating them.
• You will lose your cancelation benefits, such as performing public services.
• Your grace period may be lost.
• Interest Does not accrue when your Perkins Loan is in deferment.
• Perkins Loans generally have lower interest rates but less flexible repayment periods.
Can I consolidate if I am currently enrolled in school? Back to Top
Yes but with certain conditions. Borrowers cannot consolidate loans that are an in-school status, but borrowers can still consolidate loans that are in grace, repayment or deferment.
I have already consolidated, can I consolidate again? Back to Top
Yes, as long as you are including at least one other FFEL or Direct Loan into the new consolidation.
Can I consolidate my loans that are in grace? Back to Top
Yes, you can consolidate loans that are in grace however you will lose any of your remaining grace period.
Can I consolidate my defaulted loan? Back to Top
Yes, as long as you agree to pay under either the Income Contingent or Income Based Repayment Plan, OR make satisfactory repayments with your current loan holder.You cannot consolidate a default loan if a judgment has been issues against a defaulted loan which has not been dismissed.
Click here for more information on defaulted loans
Can I choose the repayment plan options? Back to Top
Borrowers can choose from multiple repayment plans with various term selections to repay their consolidation loan(s), including an Income Contingent Repayment and an Income-Based Repayment Plan. These plans are designed to be flexible to meet the different and changing needs of borrowers. With a Direct Consolidation Loan, borrowers can switch repayment plans at any time.
What are the repayment plans? Back to Top
There are several repayment plans in the Federal Loan Forgiveness Programs:
• Standard Repayment PlanYou will pay a fixed amount each month until your loans are paid in full. Your monthly payment will be at least $50 for up to 10-30 years, based upon your total education indebtedness (loan amounts).
• Graduated Repayment PlanYour minimum payment amount will be at least equal to the amount of interest accrued monthly. Your payments start out low, and then increase every two years for up to 10-30 years and is based on your total education indebtedness (loan amounts).
• Extended Repayment PlanTo be eligible, your Direct Loan balance must be greater than $30,000 and you will have up to 25 years to repay your loans. You have two payment options:
– Fixed Monthly Payment Option: You will pay a fixed amount each month until your loans are paid in full.
– Graduated Monthly Payment Options: Your minimum payment amount will be at least $50 or the amount of interest accrued monthly, whichever is greater.
Your payment start off low and then increase every two years.
• Income Contingent Repayment Plan (ICR)Your monthly payments will be based on annual income, Direct Loan balance, and family size. They are spread over a term of 25 years.
• Income-Based Repayment Plan (IBR)
Your monthly payments will be based on your annual income and family size, and spread over 25 years. You must be experiencing a partial financial hardship to initially select this plan and once you select this plan you cannot change to any other plan except standard.
For more in-depth information on the repayment plans, please see our Repayment Plans page
Can I later on change my repayment plan? Back to Top
Yes, most borrowers can change their repayment plan at any time once consolidated. Borrowers who are in the ICR plan must make at least 3 consecutive payments into the Direct Consolidation Loan account before changing to another plan. There is no limit to how many times you can change. Borrowers in the IBR plan can only change into the Standard Repayment Plan.
Are there tax deductions for interest paid on Federal Direct Consolidation Loans? Back to Top
Yes, if you are making payments on Federal Direct Consolidation Loans, you can deduct as much as $2,500 per year in interest payments. Even if you don't itemize your deductions, the IRS still allows you to subtract up to $2,500 in interest payments from your taxable income.
How long does It take to consolidate? Back to Top
It generally will take 60-90 days to consolidate from when the lender has received your application for consolidation.