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In general, we recommend that students strongly consider obtaining a Federal Consolidation Loan unless there is a compelling reason not to.

Federal Direct Consolidation Loans can serve as a useful tool to move your federal student loans from the Federal Family Education Loan (FFEL) Program and/or Perkins Loan Program to the Direct Loan Program, and they can also help to simplify your situation if you should have multiple lenders.

  • Consolidation does not provide a refinancing opportunity, nor does it freeze interest rates for current student loans, as all currently-available federal student loans have fixed interest rates.

  • The interest rate on a Federal Consolidation Loan is the weighted average of all the interest rates on all of the loans to be consolidated, rounded up to the next 1/8%.

  • Consolidation is the only way for students with FFEL Stafford Loans or FFEL PLUS Loans to get those loans to qualify for Public Service Loan Forgiveness.

For further reading, consult the Department of Education's Loan Consolidation page.