Consolidation can be a very beneficial way to reduce student loans. By applying for a student consolidation loan you can reduce the number of loans you are paying, lower your interest rates, and lower your monthly payment. Consolidation is the process of combing all, or some, of your student loans into one loan through one lender.

Using FFELP Consolidation to Reduce Student Loans

To be eligible to consolidate your student loans you must be out of school and repaying your loans or in a grace period. You can obtain a consolidation loan while you are still in school by entering repayment status early. You must have at least $7,500 in combined federal student loan debt to be eligible for federal student loan consolidation.

Married couples can consolidate together to reduce multiple student loans to one more manageable loan. When married couples consolidate together, each spouse is held jointly and separately responsible for the entire loan amount. Each spouse is responsible for the entire debt regardless of the amount of his or her original debt. In the event of a separation or divorce, each spouse would remain responsible for the whole amount. Furthermore, in a joint consolidation, the loan debt cannot be cancelled in the event of death or disability unless both spouses die or are disabled. For these reasons it may be best to consolidate separately.

The FFELP consolidation program offers four different repayment plans to fit your financial needs. You may change your payment plan once per year by contacting your lender. Ask your lender about payment plan options and choose the plan that works best for you.