Us department education consolidating student loans
If you’re using the paper application, you’ll mail the application to the servicer of your choice. You could also choose the Income-Based Repayment Plan, the Pay As You Earn Repayment Plan or Revised Pay As You Earn Repayment Plan as long as your consolidated loan doesn’t include a parent PLUS Loan.With ICR, IBR, PAYE and REPAYE, your monthly payment will be 10 to 20 percent of your annual discretionary income, the difference between your actual income and 100 to 150 percent of the federal poverty guideline for your family size and state.If you extend your loan terms, you will have a lower monthly payment.Federal student loan consolidation doesn’t involve a credit check, you may be able to lower your monthly payment and there could be other benefits, such as being eligible for more repayment plans or forgiveness programs.When you refinance your loan, you can choose a five-, seven-, 10-, 15- or 20-year term.Common Bond will match your federal loan deferment period if you graduated the same year you apply and your loans are currently in grace period deferment.
However, when you refinance federal loans, they’ll become private loans and will no longer be eligible for federal programs, including income-driven repayment plans and forgiveness programs.You have the option of listing loans that you don’t want to consolidate but that you want factored into your total loan balance. You can choose among Great Lakes Higher Education Corporation & Affiliates, Navient, Nelnet or Fed Loan Servicing.Your total loan balance will impact your Direct Consolidation Loan’s repayment period and monthly payment. If you plan to use the Public Service Loan Forgiveness program, you have to choose Fed Loan Servicing, as it manages the program. When you consolidate your loans, you may be able to choose the Standard Repayment Plan, Graduated Repayment Plan, Extended Repayment Plan or Income-Contingent Repayment Plan.By contrast, federal loan consolidation won’t change how much interest accrues, and eligibility doesn’t depend on your creditworthiness. You can consolidate your federal student loans and refinance your private loans, or consolidate some of your federal loans and refinance others.Or, you may research your options and determine you shouldn’t use either.