Consolidating (or, “combining”) your federal student loans   into one loan  is advantageous in that you will have the  convenience of making a single monthly payment. To qualify for a Federal Consolidation Loan, you must be in your grace period  or have already entered repayment  for   each loan  that is selected for consolidation. Consolidation generally extends the repayment period which results in a lower monthly payment by giving borrowers up to 25 years to repay their loan which may make it easier for you to repay your loans; however, you will pay more interest if you extend your repayment period through consolidation as you will be making payments for a longer period of time. Once made, Federal Consolidation Loans cannot be ‘unmade’ since the loans that were consolidated have been paid off and, therefore, no longer exist. If you do not feel that you will need monthly payment relief, you should   carefully compare the cost  of repaying your unconsolidated loans against the cost of repaying a consolidation loan. But, you MAY consolidate your loans if you are considering one of the loan cancellation options.

Helpful Hints  to remember as you complete the online consolidation application and promissory note: 

-Refer to the Repayment Plan options for a better understanding of the benefits of loan consolidation, particularly the "Income Sensitive" repayment options. 

-Determine the payment plan that works best for you; use the U.S. Department of Education’s    Online Calculator to estimate your monthly payments for the various plans. 

-Refer to Top 10 Student Loan Tips for more information as you transition into repayment/consolidation to help avoid the pitfalls of loan default.

-Before beginning the online consolidation application and promissory note, gather your loan records, account statements and related forms. Information you will want to gather includes:

  • the balance of your outstanding loan(s) which you can obtain on the Student Aid website  and can retrieve all outstanding loans and the servicer(s) who currently maintain your loans ( click on the number  of each individual loan (ie: 1, 2, 3 etc.) to see the   servicer(s) name   which is identified in the ‘Servicer/Lender/Guaranty Agency Information’ section).
  • Or, if you are already in repayment, gather pertinent loan information from your coupon booklet(s).
  • Or, if interested in an income-sensitive repayment option, gather your current income tax return.

 

For more information, visit the  loan consolidation website  or contact the Direct Loan Consolidation Center at 1-800-557-7392 (or, TTY for the hearing-impaired at 1-800-557-7395).

Or feel free to contact the MSU Financial Aid Office at   financial-aid@msutexas.edu or call us at 940-397-4214 if we can be of any assistance.

 

'Log In' to Begin Your Online Loan Consolidation Process (click here)